Sigma quadruples profit on new completions, strong rents

The London-listed residential developer reported a pre-tax profit of £4.1m for the six months to 31 March, up from £1m in the year-earlier period.

Sigma Capital Group portfolio of private rented homes across the North West and beyond and is the parent company of London-listed PRS Reit, which has 34 sites in the region as of last March.

Strong performance by PRS Reit in particular boosted the company’s H1 2021 results, according to a stock exchange filing today. Housing delivery for the reit reached near pre-pandemic levels in the six-month period with a further 956 homes completed, taking the total to 3,590 units.

As of last March, Sigma PRS REIT had 34 sites in the North West, of which 21 were in Greater Manchester including Baytree Lane in Middleton; 10 were in Merseyside including Prescot Park in Prescot, and three were in Cheshire, including Woodford Grange in Winsford.

Meanwhile, first-half group revenue was up 32% to £6.6m and cash flow from operating activities rose to £4.3m from a £1.6m loss in the year-earlier period. The group has five self-funded PRS developments underway, which when complete will provide a further 321 homes, and rental collection has remained healthy throughout the pandemic, the statement said.

A joint venture with fund manager EQT Real Estate, launched last September, expects to acquire two sites developed by Sigma by the end of the financial year, totalling 157 homes, while a further two development sites have been acquired and are underway, totalling 142 homes, the statement said.

Earlier this month, Sigma’s directors voted unanimously in favour of a group takeover by Six Bidco, a portfolio of funds managed by European private equity investor PineBridge Benson Elliot, as part of a wider growth strategy. The £188.4m deal would see Six Bidco, acquire 61% of shares in Sigma, but remains subject to final shareholder approval.

Sigma chief executive Graham Barnet said: “These results reflect Sigma’s continuing good progress. The recent offer for Sigma by PineBridge Benson Elliot was unanimously recommended by Sigma’s independent directors as in the best interests of staff, partners and shareholders as a whole, and is now following due process.”

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