News blog
Inland
- BY: Andrew Hore |
- POSTED: 01/10/2008 |
Brownfield site developer Inland believes that it could take two years for the property market to start to recover.
Inland reduced its asset values by £4.78m at the end of June 2008. The company believes that this write-down should be enough unless property values fall by a further 8%-10%.
The company’s net asset value was 32.9p a share at the end of June 2008. Following Inland’s full year figures the company’s share price fell 1.25p to 11.5p. That means that the shares are trading at a 65% discount to net asset value.
Inland argues that the underlying net asset value of the business is around 44p a share. That is based on current valuations.
It is no surprise that the property market is weak. Current annual private housing starts are well below the government’s targets but planning permission is more difficult to achieve than ever. On the bright side, building costs have stabilised.
Inland reckons that there will be increasing demand for long-term rented properties.
The brighter parts of the property market include social housing, budget hotels and care homes.
Revenues more than doubled from £5.47m to £11.01m in the year to June 2008. Nearly all of that came from property sales. The property write-downs led to a £4.19m loss.
There is cash of £4.6m in the bank although a £5.5m deferred payment has been paid out on Inland‘s Farnborough site. Inland is increasing its bank facilities from £7m to £15m.
Inland believes that there may be some acquisition opportunities next year.
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