MJ Gleeson braced for turnover to drop by more than £100m

Grant Prior 1 year ago
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MJ Gleeson is expecting turnover to fall by 42% for the financial year to June 30 2020 due to the impact of Covid-19.

A trading update by the house builder this morning said group revenue for the latest financial year will be around £145m compared to £249.9m last time.

Gleeson has re-opened 62 of its 67 sites with construction restarting on 43 while “customer demand is recovering strongly.”

The firm said: “Plot build activity is recommencing in a phased and controlled manner. By the end of this month plot build activity will have recommenced on the majority of sites.

Current safe-working protocols are, as expected, having an impact on productivity and build rate.

“However, we believe there is scope to improve productivity and build rate by the introduction of new working practices within the Covid-19 Secure protocols.”

Reservation levels originally fell to 25% of pre-Covid rates but have increased significantly in the last two weeks with reservations now at 70% of pre-Covid levels.

Gleeson completed 43 sales during April and May bringing year to date sales to 1,037 homes by 31 May 2020. Completions are expected to continue at a similar pace during June.

The company has brought back 275 of the 456 staff furloughed in April.

Currently 30% of staff remain furloughed but Gleeson said all of them will have returned to work by the end of next month.

The forward order book for sales in the next financial year currently stands at £135.2m on 940 plots (30 June 2019: £87.6m on 677 plots).

Pre Covid-19, the Company had planned to open 17 new sites during the final quarter of this financial year.

hree new sites have been opened and a further site is expected to open in the next two weeks bringing the total number of build sites to 71 by 30 June 2020 (30 June 2019: 69 build sites).

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