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The chairman of Segro has increased his ownership in the FTSE 100 warehouse landlord by more than 20% following the company’s loss in its interim results. Andy Harrison, who became chairman in April 2022, purchased £795,000 worth of shares on July 31. Despite remaining 50% lower than their peak in 2021, the shares have stabilized throughout the year.
Harrison’s purchase, made at a 17% discount to Segro’s net asset value per share, raises his total stake in the company to £4.17 million, which accounts for 0.05% of the company’s issued share capital. He has accumulated these holdings through several significant transactions since his appointment as chairman.
This news comes after Segro reported a pre-tax loss of £33 million for the first six months of the year, compared to a £1.4 billion profit in the previous year. The loss was attributed to higher interest rates negatively affecting the value of the company’s assets. However, Segro remains optimistic about the future, citing a 10.3% increase in net rental income.
Other warehouse landlords, including Tritax Big Box, are also confident about the sector’s prospects after a challenging period. Tritax Big Box’s CEO, Colin Godfrey, stated, “it looks like the market has bottomed out” after the company experienced an increase in its portfolio value. Similar to Segro, Tritax Big Box faced valuation challenges due to a rise in implied interest rates last year.
JLL, an agency specializing in real estate and investment management, reported a decrease in tenant demand for warehouses in the first half of the year compared to the previous year. However, prime warehouse rents increased by 9.5% year on year, and the current stock available for lease is less than two years of supply based on recent demand.
Coats directors buy in
Coats, an industrial thread and footwear components business, is implementing cost-cutting measures to increase market share and protect margins. The company’s latest results for the first half of the year show a decrease in revenue and pre-tax profits, primarily due to industry destocking.
Coats aims to achieve project savings of $70 million (£55 million) by 2024, with $21 million already booked in the first half of 2023. The company anticipates improved market demand in the second half of the year, but expects full-year trading to be at the lower end of analysts’ forecasts. Chair David Gosnell and non-executive director Stephen Murray have displayed confidence in the share price by purchasing shares in early August.
Consensus analyst positions on data provider FactSet indicate a forward price/earnings rating of 10 times, which is a discounted valuation compared to the five-year average of 13 times. While Coats’ growth may not be exceptional, the company holds a strong position in the market and is considered reasonably priced.
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