The private house building and partnership homes business revealed plans to create a strong modular business as it delivered strong growth in the first half of the year with pre-tax profit up 22% to £74m on revenue ahead 14% at £400m.
The group’s mixed tenure partnership homes division is now bigger than traditional house building, and will expand further following the acquisition of the Midlands- based Westleigh housing group for £135m in April.
This acquisition also included the Westframe timber frame factory based in Leicester, where Countryside plans to make further investment.
Today Countryside also revealled plans to invest £6m in a new closed panel timber frame factory of around 130,000 sq ft in Warrington. Equipment is due to be delivered in the second half of the year.
Once operational the new factory will service our northern and West Midlands regions with a total capacity of 1,500 units per annum helping to secure our supply chain for the longer-term.
Across the group Countryside raised completions by 15% to 1,655 homes in the first half of the year to March 2018.
Private unit completions increased by 23% to 773 homes. Private average selling price selling prices dropped 11%to £392,000 driven by an increase in private completions from its Partnerships business, particularly the regional businesses outside London where average selling prices are lower.
Underlying house price inflation was 3% in the half year, while underlying build cost inflation was around 3-4%.
Ian Sutcliffe, Group Chief Executive, said: “We continue to deliver our strong organic growth trajectory with robust trading in all regions. We enter the second half in great shape and our acquisition of Westleigh will further increase our momentum by expanding our geographic reach and mixed tenure delivery.
“With continued strong growth in Partnerships and improved efficiency and returns in the Housebuilding division we remain confident of maintaining our sector leading growth over the medium-term.”
Partnerships is now the main profit driver delivering a 19% margin compared to 17% at the house building arm.
This business is now driving longer-term growth plans. It secured secured 3,409 new plots in the first half including 1,300 plots at Ebbsfleet, Kent and a total of 913 plots across five sites in the West Midlands region.
Partnerships now has 21,698 plots under its control, representing nine years’ supply at current volumes.
Countryside Property trading divisions
- Completions: 1,172 homes , up 19%
- Operating profit: £47m, up 22%
- Operating margin: 19.0%, up 180bps
- Land bank plus preferred bidder: 21,698 plots, up 24%
- Completions: 483 homes, up 7%
- Operating profit: £37m, up 8%
- Operating margin: 16.9%, up 60bps
- Land bank: 19,741 plots (HY 2017: 20,472 plots)