FTSE 250 property developer St Modwen boosted profit in the first half of 2019 driven by its expansion in the warehouse and logistics sector.
Profit for the six months to the end of May was £23.1m, up from £20.8m compared to the first half of 2018.
Basic earnings per share increased from 9.4p to 10.5p.
The company hiked its interim dividend per share by 16.1 per cent to 3.6p “reflecting solid growth in earnings”.
Why it’s interesting
Changes to the way people shop has increased the need for well located logistics space, the company said.
The firm’s industrial and logistics business now makes up 39 per cent of St Modwen’s assets.
The FTSE 250 company has increased its pipeline from 1.5 sq ft to 1.6 sq ft due to increasing customer interest in its warehouses. It hopes to benefit from rising demand for last mile delivery and warehouse space near cities.
St. Modwen’s house building business continued to perform well in the six month period. St. Modwen Homes, which makes up 25 per cent of the company’s property assets, sold 411 units up 36 per cent from the first half of 2018.
What St Modwen said
St. Modwen chief executive Mark Allan said: “We have had a positive first half of 2019 and our expectations for the full year remain unchanged.
“Following our significant portfolio repositioning last year through the sale of retail and other non-core assets, our focus has now shifted to growth, building on the substantial opportunities we have in our existing portfolio.
“This is reflected in a further increase in house building volumes and industrial and logistics development activity, where the structural growth drivers remain positive despite the ongoing economic uncertainty.
“We continue to expect the delivery of this strategy to drive a meaningful improvement in return on capital and earnings over time.”