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(Sharecast News) - Floorcoverings distributor Headlam Group announced progress in its ongoing transformation plan on Friday, with property sales generating 53.9m in cash proceeds.
The London-listed firm said the sales, which included properties in Ipswich, Gildersome, Leeds and Uddingston, represented a 64% premium to book value and a 14% premium to the most recent market valuation of 47.1m.
It said the transactions had moved the company to a net cash position, and would contribute a substantial non-underlying profit.
The Ipswich property, deemed surplus following operational improvements, would be vacated by early 2025 after the group completed its relocation to a new distribution centre in Rayleigh.
Headlam said the Gildersome and Leeds properties were sold with a leaseback arrangement to support ongoing operations.
Additionally, the Uddingston property was sold for 3.1m, exceeding its valuation of 2.3m.
Despite the sales, Headlam said it retained a substantial property portfolio valued at 95m.
"These property transactions, on highly attractive terms, have been enabled by the progress we are making in optimising our operations, whilst also unlocking cash from our business, and further strengthening our balance sheet to re-invest in the Headlam proposition as the UK's leading floorcoverings distributor," said chief executive officer Chris Payne.
In a separate announcement, Headlam confirmed an upcoming leadership transition, with chair Keith Edelman, who had served on the board for six years, to step down in May following the annual general meeting.
He would be succeeded by Stephen Bird, who the board said would bring experience in driving customer-focussed growth strategies.
Bird previously served as group chief executive of Videndum, and had held senior roles at a number of major companies, including Weir Oil & Gas and Black & Decker.
"On behalf of the board I would like to thank Keith for the extensive contribution he has made to the company over the past six years, chairing the board whilst we have made significant progress against our strategy and overseen our transformation plans," Chris Payne said.
"I'm pleased Stephen has agreed to be our next chair and look forward to continuing to work with Stephen and the board as we implement our transformation plan over the next two years."
At 0944 GMT, shares in Headlam Group were up 6.84% at 140.5p.
Reporting by Josh White for Sharecast.com.