Sigma shares jumped nearly 10% in early trading on Tuesday as it gave a positive trading update to the stockmarket, forecasting profits would be ahead of expectations this year.
The specialist in developing out council assets, with several private rented residential projects underway in Greater Manchester and Liverpool, said profits were likely to come in above £2.0m for the year to the end of December.
Sigma said in its statement: “The second half of the financial year has progressed very well, with the rate of delivery of PRS units ahead of management’s initial targets. Accordingly, Sigma is expected to deliver profit before tax in excess of £2.0m, which is significantly ahead of current market expectations.
“The company remains very well positioned for 2016 with work in progress ahead of plan as recent announcements have indicated. Our second phase of PRS delivery with Gatehouse Bank plc, for c.900 new rental homes, is now underway across Greater Manchester and Liverpool, and our target for 2016 is to launch similar sized phases in two further regions in the Midlands and the South. This will deliver a run rate of over 3,000 units by the end of 2016, firmly positioning the company as one of the largest housing delivery platforms in the UK and the largest in PRS.”
During the first half of 2016, Sigma said it expects to begin construction with another housebuilding partner, Keepmoat. This will add additional capacity alongside long term partner, Countryside Properties, as well as access to further land opportunities in addition to the current pipeline.
Sigma’s board expects to announce full year results in mid-April when a further update on trading will be provided.
Sigma also granted share options totalling 1.3m shares to four directors, exercisable at 93.5p between three and 10 years from today.
The share price rose 9p to 102p, valuing the company at £90m.