Pre-Close Trading Update

Bellway p.l.c. Pre-Close Trading Update Thursday 8 August 2013 Bellway p.l.c. is today issuing a pre-close trading update for the financialyear ended 31 July 2013. Market and Trading The new homes market has benefitted from improving consumer confidencethroughout the year, having been supported by government schemes in the form ofNewBuy and Help to Buy. Visitor numbers have risen and reservations have exceeded expectations,averaging 128 per week (2012 - 101), an increase of 27% compared with theprevious year. The sales rate has improved since the introduction of Help toBuy, with this scheme having been used in 830 reservations since its launch. All geographic regions have seen improved performance with the Group continuingto benefit from its presence in the London market, where 19% of reservationshave been taken during the year. Results The Group has legally completed the sale of 5,652 homes (2012 - 5,226), anincrease of 8.2% compared with the previous year. The average selling price ofhomes sold has increased by 3% to around £193,000 (2012 - £186,648) with theresult that housing revenue is expected to be around £1,090m (2012 - £975m), anincrease of around 12%. There is some evidence that house prices on more recent land acquisitions,especially in the south of England, are modestly ahead of initial acquisitionassumptions. This has not, however, had any measurable effect on the growth inthe Group's average selling price which has largely been achieved throughcontinuing changes in product mix. The operating margin continues to improve, driven by a growing proportion ofcompletions from higher margin land, acquired since the downturn. Whilst thereare some indications of minor cost pressures at a local level, these have nothad a significant effect on the Group's operating margin which will exceed the11.4% achieved last year by around 200 basis points. Land The Group has continued its disciplined approach to land acquisition, havingexpended £300m on land and land creditors, on sites that meet the Group'sminimum acquisition criteria with respect to gross margin and return on capitalemployed. In addition, the Group has heads of terms agreed on a further 4,100plots. As at 31 July 2013, Bellway had thirteen operating divisions. Since 1 August,the Group has opened two new divisions, with these being located in Manchesterand the Thames Valley. The Group therefore has significant operational capacityfor future volume growth. This should be achieved through ongoing investment inland, provided that opportunities continue to be identified that meet or exceedthe Group's acquisition criteria. The Group ended the year with net bank debt of only £6m and this, combined withlimited exposure to historic shared equity schemes, a relatively insignificantpension deficit and a discerning use of land creditors, ensures that the Groupretains its balance sheet strength to continue its expansion, should existingmarket conditions prevail. Outlook The resilience in consumer demand has allowed the Group to build a strong orderbook comprising 3,525 plots (2012 - 2,533) with a value of £679.5m (2012 - £441.2m), representing an increase in value of 54% on the previous year. Thestrength of the order book provides the Board with reason for optimism forfuture volume growth. Further growth in volume and margin, together with a continuing focus on returnon capital employed, combined with a progressive dividend policy, should enablethe Group to deliver further enhancements in shareholder value. The preliminary results for the year ended 31 July 2013 will be announced onTuesday 15 October. FOR FURTHER INFORMATION PLEASE CONTACT: TED AYRES, CHIEF EXECUTIVE AND KEITH ADEY, FINANCE DIRECTOR FROM 7:30 AMONWARDS ON 0191 217 0717. Certain statements in this announcement are forward-looking statements whichare based on Bellway p.l.c.'s expectations, intentions and projectionsregarding its future performance, anticipated events or trends and othermatters that are not historical facts. Such forward-looking statements can beidentified by the fact that they do not relate only to historical or currentfacts. Forward-looking statements sometimes use words such as `aim',`anticipate', `target', `expect', `estimate', `intend', `plan', `goal',`believe', or other words of similar meaning. These statements are notguarantees of future performance and are subject to known and unknown risks,uncertainties and other factors that could cause actual results to differmaterially from those expressed or implied by such forward-looking statements.Given these risks and uncertainties, prospective investors are cautioned not toplace undue reliance on forward-looking statements. Forward-looking statementsspeak only as of the date of such statements and, except as required byapplicable law, Bellway p.l.c. undertakes no obligation to update or revisepublicly any forward-looking statements, whether as a result of newinformation, future events or otherwise.