Land owner in good shape
Uplift in profits sets up Buccleuch for ‘exciting period of change’
Benny Higgins: positive year (pic: Terry Murden)
Buccleuch Estates, the land and property owner, has announced that pre-tax profits at parent company MDS Estates came in at £31.75 million in a year which produced record levels of activity.
The figure for the 12 months to the end of October last year marks a sharp rise on taxable profit of £4.8m in 2017. After taxes and minority interests, the company reported a bottom line figure of £23.23m (2017: £5.17m).
The rise accounts for losses in the previous period, a revaluation of assets, higher income from fixed assets and lower interest charges. Turnover came in at £65.9m against £60.1m in the previous year.
Benny Higgins, executive chairman of MDS Estates, the parent company of Buccleuch, said: “We find ourselves on the cusp of an exciting period of change for Buccleuch.
“Within the commercial property sector, the commercial and residential markets have had a positive year, with record levels of investment and sustained growth in rental and capital values which were better than predicted. Against this background, Buccleuch Property had a positive year, delivering profitability against target and delivering to forecast on disposal and reinvestment commitments, setting us up in a strong position for the coming year.
“Diversification and an increasing shift to working within joint ventures in agriculture have and will continue to help the business maintain a positive position overall. While within forestry, the attainment of better than expected timber prices in the South of Scotland, combined with other works undertaken by the forestry team led to a substantial increase in revenue over the year, which looks set to be maintained.
“Brexit continues to cause uncertainty across all the sectors in which Buccleuch operate, although the true impact will not be known for a few years.
“We will continue to plan our various land uses, from forestry and farming, to hospitality and renewable energy, with a clear focus on economic, environmental and community considerations. In doing so, we will continue to review and shrink the footprint of Buccleuch, which, together with new projects and other investments will allow the business to maintain a surer footing.”
He said a significant part of the profit arises from property revaluations and from profits on the sale of assets, rather than underlying operational performance, although that too has improved year on year.
“This strong financial position will improve job security for colleagues and provides the means to invest in other areas of the business,” he said.
Buccleuch actively farms 159,000 acres across its four estates and, over the year, the forestry team have continued their work planting and maintaining 24,250 acres of commercial and heritage woodlands. Alongside these more traditional rural industries, Buccleuch’s commercial property interests had a positive year and further investment was made into Dalkeith Country Park to improve the customer experience.
- Group turnover of £54,234,000 across commercial property and rural business operations.
- Overall profit after taxation of £23,230,000 due mainly to property revaluations and sales.
- Sales of land and property reflect commitment to reducing geographical footprint.
- The Duke of Buccleuch stood down as chairman of the company to be succeeded by Benny Higgins as executive chairman.
- The Earl of Dalkeith, Lord Walter Scott, elected vice-chairman.