4th Dec 2015 07:38
LONDON (Alliance News) - The Berkeley Group Holdings PLC on Friday said its pretax profit dipped in the first half due to gains it made a year earlier from the sale of ground rent assets, though revenue increased and Berkeley also announced a boost to its dividend programme.
The FTSE 100-listed housebuilder, which almost exclusively focuses on more-expensive developments in London and the South East of England, said its pretax profit fell to GBP293.3 million in the six months to the end of October from GBP304.9 million a year before, primarily due to the one-off gain made a year earlier from the sale of ground rent assets.
Adjusted pretax profit, which strips out the one-off profit from the ground rent sale, rose to GBP242.3 million, up 10% from GBP219.8 million the year earlier, however, as revenue for the group rose to GBP1.14 billion from GBP304.9 billion.
The group said underlying demand in its markets remains robust and the operating environment is still stable and, illustrating its confidence on its outlook, said it would hike it dividend return programme to the tune of GBP500.0 million, with the target of returning GBP16.34 per share in total to shareholders by the end of September 2021. This is increased from GBP13.00 per share previously and means its dividend payout through to September 21, 2016 from now will be 200.00 pence per share, up from 144p.
Berkeley said its forward sales position at the end of September was GBP3.1 billion, up from GBP3.0 billion at the end of April, while its total land bank is valued at GBP5.4 billion, up from GBP5.3 billion, across 38,233 plots.
"I believe that Berkeley continues to operate the right strategy under its unique operating model of developing complex sites which others are not willing or able to take on, recognising the additional operational risk that comes with this strategy whilst maintaining the financial strength that it demands," said Tony Pidgley, Berkeley's chairman.
"The enhanced plan announced today balances both of these factors, enabling Berkeley to continue to invest in the business and manage the operational challenges carefully and intensively whilst creating consistent and sustainable added value returns," Pidgley added.
By Sam Unsted; [email protected]; @SamUAtAlliance
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