9th Jun 2020 08:06
(Alliance News) - Residential property developer Bellway PLC on Tuesday said that it has "carefully and gradually" restarted construction and sales activity in England & Wales and its current forward sales position remains substantial which should enable a strong liquidity position in the months ahead.
The Newcastle-based company recommenced construction work on around 230 sites and has opened all remaining sales offices in England on Monday last week, following a trial starting from May 18.
The FTSE 250-listed company, however, noted that current productivity rate remains minimal and work is primarily limited to homes nearing completion. Over the coming weeks, the company expects increase in construction rate with more than one tradesperson working in a home at the same time, albeit on separate floors.
Bellway's current order book stands at 6,038 homes, or GBP1.57 billion, compared with 6,312 homes, or GBP1.64 billion, as at June 2, 2019. In the 10 months to May 31, 2020, the company sold 6,721 homes versus 7,674 homes a year ago, including 708 which completed on or after March 23, the UK lockdown date.
Sales activity, however, has remained restrained since initially closing sales centres, the company noted, with the net reservation rate rapidly declining to an average of 71 homes per week in the 10 weeks to May 31 from 231 per week a year ago.
Bellway expects the reopening of sales centre to result in a gradual pick-up in customer interest.
"Given the ongoing uncertainty, financial guidance remains suspended, however, the resumption of build programmes should enable Bellway to slowly increase the number of completions throughout the late summer and autumn months," the company said.
Bellway had net bank debt of GBP157 million as at May 31. It has committed bank facilities of GBP545 million and is an eligible issuer under the UK government's coronavirus loan scheme for up to GBP300 million.
Shares in Bellway were up 0.7% at 2,978.00 pence in London on Tuesday morning.
By Tapan Panchal; [email protected]
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