5th Aug 2016 06:39
LONDON (Alliance News) - FTSE 250 housebuilder Bellway PLC on Friday said trading in recent weeks since the UK voted to leave the European Union had been encouraging, and said it expects to post a rise in revenue for its financial year.
Bellway said it expects to report revenue of GBP2.20 billion for the year ended July 31, up 27% from the GBP1.74 billion recorded a year earlier, on the back of a 13% rise in housing completions to 8,721 and a 13% rise in average selling price to GBP252,700.
Bellway said the UK land market remained attractive throughout the year, and Bellway was able to "selectively acquire" sites that met its minimum hurdle rates in respect of gross margin and return on capital employed. Bellway contracted to purchase 9,555 plots across 88 sites during the year, up from 9,128 plots across 88 sites a year earlier.
However, while the housebuilder said trading had been encouraging since the outcome of the EU referendum was announced, it said it was proceeding cautiously with a number of site acquisitions pending the outcome of the autumn selling season.
"If required, the group can moderate the rate of land investment in the short-term to preserve maximum value for shareholders," Bellway said.
Bellway said it was too early to determine the extent to which the EU referendum may have an effect on longer-term consumer confidence, but said underlying demand for new homes remained strong, supported by lenders' willingness to provide ongoing access to affordable mortgage finance.
The company's forward order book at year-end stood at 4,664 homes at a value of GBP1.12 billion, ahead of the 4,568 homes with a value of GBP1.09 billion a year earlier.
By Hannah Boland; [email protected]; @Hannaheboland
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