Watkin Jones sells £82m student portfolio

The AIM-listed stockmarket newcomer used its first trading statement to shareholders to report a successful start to the financial year, confident outlook for 2016 and forward sale of developments in four cities.

The update for the half year ended 31 March 2016 came ahead of the interim results due to be published by the Bangor-based developer of student accommodation in June.

Shares in the company began trading on 23 March at 100p and closed at 108p last night, valuing the business at £282m.

Watkin Jones said: “The board is pleased to report a successful first six months of the financial year with trading in line with its expectations. The group had net cash as at 31 March 2016 in excess of £12.5m.

“During March 2016, four student accommodation developments in Glasgow, Birmingham, Bath and Sheffield, representing 1,175 beds in total were forward sold with a gross development value of £82m. A total of 16 developments, comprising 6,395 beds, have now been forward sold, including all of the developments planned to be completed by September 2016 and seven of the nine planned to be completed by September 2017, and the group is on site to deliver these developments. Watkin Jones has a further three developments totaling over 900 beds, under offer and in legal negotiations and a number of other planning applications have been submitted in respect of the ongoing pipeline.”

The statement continued: “During March 2016, the group’s asset management subsidiary, Fresh Student Living, secured a further 536 bed scheme in Glasgow, which brings the total number of beds expected to be under management for the start of the 2016 academic year to 12,663.

“The group’s progress in delivering the current development pipeline is encouraging and the board remains confident in the outlook for the full year.”

Mark Watkin Jones, chief executive, added: “Our performance over the past six months reinforces the attractiveness of our end-to-end business model to institutional investors. The transition to a public company has gone very smoothly and I am delighted by the positive response to our successful admission to AIM on 23 March.”