Bellway house building completions up 7%

Aaron Morby 13 years ago
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House builder Bellway stepped up house building rates this year to complete 4,922 homes, 7.1% up on the previous period.

The house builder, which traditionally had a stronger focus on the north, said operating margin is set to rise from 6.7% to between 8% and 9% for the full year.

Its margin in the second quarter finally returned to double digit territory of 10%, marking a return to better times on average selling prices ahead 7.2% at £175,000, mainly derived from changes in product mix.

As a result the house builder said in a trading update to the Stock Exchange that profit before tax would be ahead of current market consensus of £62m.

The builder said reservation rates throughout the summer months, traditionally a slower selling period, were ahead of the last year.

Bellway’s order book has edged up £6m to £427m, representing 2,497 homes, of which 2,334 should legally complete in the next twelve months.

Bellway has net cash of just £3m with combined bank facilities of £290m, after spending £250m on land and land creditors during the year.

In addition, some 4,500 plots valued at £230m currently have terms agreed.

Bellway’s continuing aims for 2011/2012 are to deliver incremental volume
growth, repair operating margins and, through changes in product mix, improve
average selling prices, all of which are largely dependent on the level of
consumer confidence and the availability of mortgage finance.

The firm also said that Alistair Leitch, group finance director, has decided to retire from the board on 31 January 2012. He will be replaced by the current group chief accountant Keith Adey.

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