12th Mar 2021 08:02
(Alliance News) - Berkeley Group Holdings PLC on Friday said it has continued to trade "robustly" since November and remains on track to deliver, in line with guidance, a "similar" profit to last year.
Shares in the housebuuilder were down 6.5% at 4,273.00 pence in London early Friday, making the stock the worst performer in the FTSE 100 in opening trade.
The FTSE 100-listed property developer said it expects profit for the year to the end of April to be around GBP504 million, broadly flat year-on-year, and forward sales are anticipated to be above GBP1.7 billion at the year-end.
Berkeley noted that the market fundamentals remain strong, with low interest rates. Sales reservations have been "robust" where the company has had availability of stock.
The Cobham, England-based company, however, noted that it has decided to postpone the launch of new developments and phases into the market until the economy opens up post-lockdown, despite enquiry levels remaining "consistently strong". Berkeley said it anticipates the value of reservations for the current financial year to be around 20% lower than last year.
Pricing has been stable over the financial year and cancellation rates at "normal" levels, Berkeley said.
"The current operating environment remains volatile with the period under review including both the second and third national lockdowns and the ending of the Brexit transition period," the company said in its statement Friday.
"Nevertheless, Berkeley has continued to invest in its large, complex, long-term regeneration sites. Onsite labour numbers remain above pre-pandemic levels and, while we are experiencing some materials delays and price increases in specific areas, the overall impact on build costs has been neutral."
Going forward, Berkeley said it is on track to deliver a similar level of profitability in its next financial year and to achieve its long-term 15% pretax return on equity guidance.
"This underpins Berkeley's ongoing commitment to return GBP280 million per annum to shareholders through either dividends or share buy-backs; a level it has delivered consistently since 2016, including over the last 12 months," the company noted.
By Evelina Grecenko; [email protected]
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