Annual Report 2015

Our Year in Numbers

Profit before tax (£m)

+14%

£32.4m

Net debt (£m)

+7%

£38.9m

Net asset value per ordinary share (p)

+10%

168p

Dividends per ordinary share (p)

+9%

6.10p

Earnings per ordinary share (p)

+8%

17.5p

Operating profit (£m)

+13%

£31.7m

Our Year in Numbers Continued

Profit before tax (£m)

Net debt (£m)

Net asset value per ordinary share (p)

Dividends per ordinary share (p)

Earnings per ordinary share (p)

Operating profit (£m)

Business Segment Performance

The strength of our business and our consistent growth is achieved through our diverse business segments. This business model allows us to invest prudently in appropriate market opportunities throughout the business cycle, delivering long-term shareholder value growth.

Land Development

Land Development

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Hallam Land Management Limited

The strategic land and planning promotion arm of the Henry Boot Group. Our experienced land and planning teams promote opportunities through the complexities of the UK planning system and sell schemes to the UK house builders. The company has been acquiring, promoting, developing and trading in land since 1990.

Total revenue (£m)

+20%

£46.7m

Profit before tax (£m)

+46%

£19.1m

Property Investment

Property Investment and Development

Property Investment-and Development Icon

Henry Boot Developments Limited

A major established leading force in the UK property development market. The company has also built up an  investment portfolio of over £100m in recent years.

Stonebridge Projects Limited

A jointly owned company in the north of England which develops family homes that combine care, consideration and attention to detail. The company also provides high specification fully serviced office space to small business occupiers.

Total revenue (£m)

+93%

£50.3m

Profit/(loss) before tax (£m)

-24%

£3.5m

Construction

Construction

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Henry Boot Construction Limited

Specialising in serving both public and private clients in all construction and civil engineering sectors.

Banner Plant Limited

Offering a wide range of construction equipment and services for sale and hire.

Road Link (A69) Limited

Road Link has a 30-year contract (ten years remaining) with Highways England to operate and maintain the A69 trunk road between Carlisle and Newcastle upon Tyne.

Total revenue (£m)

+3%

£90.6 m

Profit before tax (£m)

-2%

£9.9m

Chairman's Overview

Year of transition and strong progress

In a year of many changes, our belief in our founder’s values, our purpose and our strategy, as well as careful succession planning, gave us the confidence that we could continue to deliver consistently to our stakeholders. Our cohesive approach has allowed us to make strong progress.

Jamie Boot

Chairman

Highlights of the year

  • Circa £500m of commercial activity expected to commence in 2016 concluding over the next four years. Mostly pre-sold and almost all pre-let.
  • Almost 150 strategic land schemes throughout the country with over 12,000 permissioned units to sell over the next 3-5 years.
  • Sales of 1,763 plots in the year compared to 1,107 in 2014.
  • Within Construction, major contract at Stocksbridge concluding in 2016, a new similar sized three-year contract to follow on, underpinning activity up to 2019.
  • Succession planning Board changes implemented seamlessly during 2015. New team takes business on in great shape.
  • Record dividend of 6.10p, a 9% increase.
  • Gearing levels stable despite significant growth in activity.

Progressing our Strategy

As we progress and evolve our key objective remains consistent . . . to maximise shareholder value

John Sutcliffe

Chief Executive Officer

How do you see the business progressing and developing over the next five years?

Our business segments are all operating in relatively stable markets. Pricing and activity are at reasonably good levels and I see little evidence of the excessive pricing or leverage that typified the end of the last property cycle.

Therefore, with land and commercial development portfolios that are larger and more advanced than at any stage in my ten-year experience at Henry Boot, the marketing, sale and completion of those opportunities is our key focus, whilst economic conditions remain supportive.

Over the last five years our teams have created a very valuable portfolio of schemes. We aim to realise this potential for shareholders over the next five years.

Case Studies

Our achievements in 2015

Henry Boot continues to create consistent value through our three business segments, supported by our framework of Responsible Practices. These key achievements demonstrate the progress made in 2015.

Land Development

Land Development

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Lubbesthorpe, Leicestershire

Hallam is in partnership with two other developers on this 970 acre site.

A minded to grant resolution was secured for 4,250 homes, our share being 1,593 properties, in 2013. The scheme also consists of a 50 acre business park, a district centre, two local centres, a secondary school and two primary schools. In late 2013 we negotiated a highly complex Section 106 agreement which has recently been signed, confirming our largest single permission.

Preparatory infrastructure works are now under way on the M1 near Leicester Forest East to install the new M1 Bridge which will create one access point to the site. Works have also commenced for the southern access point to the development.

The new bridge is expected to open by late 2016 and the housing development will commence thereafter.

Property Investment

Property Investment and Development

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The chocolate works, york

The 27 acre Grade 2 listed former Terry’s Chocolate Factory, with its iconic clock tower, was purchased by Henry Boot Developments in 2013 after having been empty for many years due to difficult planning and viability issues.

We immediately sold 13 acres to Barratt Developments PLC with permission for 270 residential properties. In 2015, after extensive planning negotiations, an unconditional development agreement was exchanged with listed building conversion specialist P J Livesey to undertake the conversion of the main 170,000 sq ft multistorey factory building to provide 150 luxury apartments, the first phase of which will be completed before the middle of 2016. The first new purchasers of apartments within this historic property are expected to take up occupancy during 2016.

A sale of the listed HQ office building was also completed in 2015 following receipt of planning permission to convert it to a care home.

Construction

Construction

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Saint helena’s school, chesterfield

Henry Boot Construction has commenced on site at St Helena’s School in Chesterfield to refurbish a Grade 2 listed building dating back to 1892 for the University of Derby.

The works include the complete renovation of the existing building together with a new feature entrance and external soft and hard landscaping.

The purpose of this project is to create a primary site for delivering a step change in higher-level vocational skills (including apprenticeships) to support the economic growth and resilience of businesses and workforce in Chesterfield and North East Derbyshire, achieved by providing new, local routes to vocational higher-level skills.

The 48 week project will be completed in September 2016.

Responsible Practices

Responsible Practices

Corporate Responsibility

Our activities have enabled us to develop a sustainable and responsible business.

Acting ethically​,​ developing positive relationships, and taking responsibility for our impact on the environment during 2015 has ​been ​further enhanced ​and evidenced in the case studies ​shown ​in our Corporate Responsibility Report.