Sutton Harbour Interim Results Show Narrowed Loss Amid Development Pause and Debt Focus

Sutton Harbour H1 2025: narrowed loss, lower gearing, and a cautious pause on development

Sutton Harbour Group’s interim results for the six months to 30 September 2025 show a business keeping the lights on through disposals and tight cost control, while battening down the hatches on new development. The loss before tax narrowed to £0.474m from £0.825m, net debt edged lower, and the company is actively working on refinancing and further debt reduction.

The trade-off is clear: selling assets pays down borrowing, but it also trims recurring rental income. With demand for new schemes weak and funding tight, management has pressed pause on development spend and is prioritising non-income producing disposals and interim uses of vacant assets.

Key numbers investors should know

Metric	H1 2025	Comparative
Revenue	£6.603m	£4.345m (H1 2024)
Gross profit	£1.259m	£1.328m (H1 2024)
Loss before tax	£0.474m	£0.825m loss (H1 2024)
Exceptional items	£0.217m net income	£0.230m net cost (H1 2024)
Net financing costs	£1.127m	£1.070m (H1 2024)
Net assets	£34.630m	£35.104m (31 Mar 2025)
NAV per share	24.2p	24.6p (31 Mar 2025)
Net debt	£26.061m	£26.809m (31 Mar 2025)
Gearing (net debt / net assets)	75.3%	76.4% (31 Mar 2025)
Cash at period end	£263k	£1.034m (31 Mar 2025)
Basic EPS	(0.33p)	(0.58p) (H1 2024)

What drove the numbers in H1 2025

Gross profit dipped to £1.259m, with real estate income lower after selling five properties between September 2024 and June 2025 and one-off write-offs of accrued income. Despite that, total revenue rose to £6.603m because the period includes £2.675m of disposal proceeds, which sit in the segmental revenue line for “Real Estate Disposals”. That boosts the headline but does not repeat every half year.

Operating profit was £0.653m helped by £0.217m of net exceptional income. Finance costs remain the main drag at £1.127m, reflecting the debt load and interest accruing on related party loans, even as bank interest has eased after repayments and lower base rates.

Operations: marinas steady, car parks better, fisheries still muted

• Marinas and car parks traded slightly ahead of last year through summer and early autumn. The team worked the Southampton International Boat Show and launched the 2026/27 selling campaign in November, with about half of current berth-holders already paying in full for next season starting 1 April 2026 – a helpful signal for future cash flow.
• Fisheries activity has stabilised at a lower level since the May 2024 closure of the third-party auction. More fish is now landed directly to other ports, and fuel sales have softened in recent months. Demand for storage and processing space remains robust.
• Two investment properties were sold in the period.

Debt reduction, refinancing and the development pause

Management continues to navigate a careful path between deleveraging and maintaining income. A £2.190m bank loan repayment was made in H1, bringing current bank debt to £18.065m. Related party loans increased by £0.692m to £8.046m, made up of a £0.315m drawdown for working capital and £0.377m of accrued interest. Net debt fell to £26.061m, trimming gearing to 75.3%.

The plan now emphasises selling non-income producing assets, including development land, to reduce debt without eroding the rent roll further. The bank facility requires a further £6.5m repayment by 31 March 2026 and expires in December 2026. The company says it is working with its bank and advisers on the merits and timing of each sale in the context of refinancing.

Given weak national and local demand, funding constraints and viability concerns, pre-planning and planning submissions for new schemes are paused. The focus is on interim uses of available assets to support stable returns while keeping the Sutton Harbour location attractive.

Exceptional items and ongoing legal matters

Exceptional items were a net income of £0.217m, comprising:

• £0.411m net income related to the maintenance of Sutton Lock, reflecting ongoing legal costs offset by recovery of some past costs.
• £0.194m of costs relating to the claim by Plymouth City Council on the lease of the former airport site.

Both matters remain active, but the company says legal restrictions limit further disclosure for now.

Balance sheet quality and cash position

Net assets slipped to £34.630m, or 24.2p per share, mainly reflecting the period loss. Property, plant and equipment and investment property stood at £31.440m and £12.609m respectively. There were no impairment or fair value adjustments booked in H1 2025, following the significant adjustments recorded in the last financial year.

Cash ended the period at £263k. Operating cash outflow was £0.739m, interest paid £0.751m, and disposals generated £2.675m of proceeds. The modest cash cushion underlines the importance of timely asset sales and the marina prepayments already being secured for the next season.

Jargon buster

• NAV per share – net asset value divided by the number of shares. It is a snapshot of balance sheet value per share.
• Gearing – net debt as a percentage of net assets. Higher gearing means more financial risk.
• Exceptional items – material, non-recurring items kept separate from underlying trading to help readers understand performance.
• Related party loan – borrowing from a party connected to the company, with interest accruing even if not currently paid.

My take: the good, the bad, and what matters next

Positives worth noting

• Loss before tax narrowed to £0.474m and administrative expenses fell slightly.
• Gearing eased to 75.3% and net debt decreased to £26.061m, helped by disposals and repayments.
• Marinas and car parks traded slightly ahead of last year, and early berth renewals for 2026/27 support near-term cash flow.
• Exceptional items swung to a small net income, rather than a cost.

Headwinds to keep front of mind

• Revenue quality is flattered by £2.675m of disposal proceeds – a helpful but non-recurring boost.
• Cash at period end was £263k and operating cash flow was negative, highlighting the importance of ongoing sales and refinancing.
• Interest remains a heavy burden at £1.127m in six months, with related party loan interest accruing.
• The fisheries business is subdued post-auction closure, and property income is lower after disposals.
• A £6.5m bank repayment is due by 31 March 2026 and the current facility expires in December 2026.

Outlook: steady trading plus disciplined deleveraging

This update is about preservation, not expansion. Sutton Harbour is leaning into what works – the marinas, car parks and core property assets – while selling selectively to manage debt. In an environment that “does not favour new development”, pausing schemes and pursuing interim uses looks sensible.

For investors, the near-term story hinges on three things: continued progress on non-income producing disposals, maintaining occupancy and pricing in marinas and car parks, and landing a refinancing that fits the business. Deliver those, and the group can ride out the cycle with the Sutton Harbour location intact for when development economics improve.