Hargreaves Services PLC Valuation and Realisation Plan for Renewables (0173H)
2023年7月25日 - 3:00PM
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RNS Number : 0173H
Hargreaves Services PLC
25 July 2023
Hargreaves Services plc
("Hargreaves", the "Company", or the "Group")
Valuation and Realisation Plan for Renewable Energy Land
Assets
Hargreaves Services plc (AIM: HSP), a diversified group
delivering services to the industrial and property sectors,
announces significant progress regarding its renewable energy land
assets.
Strategic Focus
The Group has remained focused on its strategy to create,
deliver and realise value for shareholders. Over recent years
progress has been made on the creation of value opportunities
including identifying opportunities for renewable energy assets to
be constructed on or accessed from some of the Group's land which
has limited alternative development potential. The Board can now
announce that it has identified clear opportunities for value
realisation, as set out below:
Renewable Asset Valuation and Realisation Plan
A key focus over the last few years has been the identification
of several thousand acres of the Group's land which is now under
lease to third parties for the construction of wind farm as well as
other renewable energy assets and the granting of access to third
party wind farm projects. Collectively, these have the potential to
generate over 700MW of clean electricity. The Group has rights to
receive index linked ground rents from these assets, most of which
are linked to the underlying price of the electricity they
generate.
The first wind farm on our land became operational earlier this
year at Dalquhandy. Similar land assets within the renewable land
portfolio have increasing index linked rental income coming on
stream over the next few years resulting in a growing and
meaningful annual return to the Group. Most of these renewable
energy land assets have planning permission and approved dates for
grid connections, significantly de-risking the projected income
profile.
We have recently commissioned the first independent valuation of
these renewable energy assets by Jones Lang LaSalle Limited. This
review has placed a Market Value Today* in the range of between
GBP21.6m and GBP23.1m on these assets as at 30 June 2023 with a
Market Value at Commissioning of Development ("COD")* expectation
in the range of GBP27.2m to GBP28.9m for when the assets commence
generation which is at various points over the period to January
2027. The Board intends to commission this valuation on an annual
basis going forward, but does not intend to revalue its investment
property in its annual statements.
These investment property assets are held on the Balance Sheet
at an historic cost of GBP6.6m, resulting in a substantial gain to
be realised. These assets exclude the Westfield site where an
Energy from Waste ("EfW") plant is being constructed by a third
party.
It is the intention of the Board to realise the value of these
renewable energy land assets, as well as the Westfield EfW, over
the next five years in an orderly manner and to repatriate proceeds
to shareholders. This is a clear demonstration of the Group's
strategy to create, deliver and then realise value for
shareholders.
Commenting on the Valuation and Realisation Plan, Acting Group
Chair Nigel Halkes said: "While originally unsuitable land for
commercial or residential projects, Hargreaves has identified
exciting opportunities for renewable energy projects generating a
long-term index linked rental income stream for the Group. With a
roadmap to delivery of these projects now in sight, our Valuation
and Realisation Plan is a clear demonstration of the Group's
efficient strategic planning and commitment to creating, delivering
and realising value for our shareholders."
* Valuation definitions
Market Value Today - Market Value Today takes the Market Value
at COD and applies an appropriate reduction to reflect the inherent
risk of delivery that would likely arise between a willing buyer
and a willing seller based on the circumstances as they are at 30
June 2023.
Market Value at COD - represents the price at which the
portfolio would change hands between a willing buyer and a willing
seller, neither being under any compulsion to buy or sell and both
having reasonable knowledge of the relevant facts.
For further details:
Hargreaves Services www.hsgplc.co.uk
Gordon Banham, Chief Executive Tel: 0191 373 4485
John Samuel, Group Finance Director
Walbrook PR (Financial PR & Tel: 020 7933 8780 or hargreavesservices@walbrookpr.com
IR) Mob: 07980 541 893 / 07584 391 303 /
Paul McManus / Lianne Applegarth 07747 515 393
/
Louis Ashe-Jepson
Singer Capital Markets (Nomad and Corporate Tel: 020 7496 3000
Broker)
Sandy Fraser / Justin McKeegan
About Hargreaves Services plc ( www.hsgplc.co.uk )
Hargreaves Services plc is a diversified group delivering
services to the industrial and property sectors, supporting key
industries within the UK and South East Asia. The Company's three
business segments are Services, Hargreaves Land and an investment
in a German joint venture, Hargreaves Raw Materials Services GmbH
(HRMS). Services provides critical support to many core industries
including Energy, Environmental, UK Infrastructure and certain
manufacturing industries through the provision of materials
handling, mechanical and electrical contracting services, logistics
and major earthworks. Hargreaves Land is focused on the sustainable
development of brownfield sites for both residential and commercial
purposes. HRMS trades in specialist commodity markets and owns DK
Recycling, a specialist recycler of steel waste material.
Hargreaves is headquartered in County Durham and has operational
centres across the UK, as well as in Hong Kong and a joint venture
in Duisburg, Germany.
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