Berkeley bullish about market bounce back

Grant Prior 5 years ago
Share

Berkeley is confident of regularly hitting annual pre-tax profits of £500m as the house builder predicts a strong bounce back from the Covid-19 pandemic.

The firm unveiled latest results for the year to April 30 today showing pre-tax profits of £503.7m from turnover of £1,920.4m.

Berkeley had predicted profits of £550m before revising that target down to £475m when lockdown hit.

It said: “Berkeley therefore surpassed its initial expectation in this regard, in spite of the challenges of maintaining production on site and for customers in securing mortgages and achieving legal completions in this period.”

Berkeley sites are currently working at around 80% of full capacity.

Chief executive Rob Perrins said: “Looking forward, this response to the initial impact of Covid-19 means that the Company is still targeting a cumulative pre-tax ROE of 15% for the six year period ending on 30 April 2025, which broadly equates to average annual pre-tax profit of £500 million.

“We now anticipate profit delivery in the coming year to be weighted towards the second half of the year in an approximate one third to two thirds ratio.

“This does assume no further significant disruption from a second wave of Covid-19 or a disorderly end to the Brexit transition period.”

Berkeley currently has £1,138.9m of cash in the bank and estimated gross profit in its land holdings of £6.4 billion.

Perrins said: “Over the last two years construction has begun on over 20 new sites giving Berkeley a firm foundation for delivering, prior to Covid-19, an anticipated 50% increase in production over the next five years, underpinned by a strong opening forward sales position. 

“While Covid-19 has caused short term delays and volatility, it does not change the fundamental strength of the business, which is set up in appreciation of the risks of a cyclical market.

“Berkeley’s financial strength means that it can continue to meet its purpose by investing in its unique operating model to deliver large, complex regeneration sites and help the country rebound from the impact of the pandemic and to continue supporting approximately 32,000 UK jobs, directly and indirectly, in its business and supply chain for the foreseeable future.”

Latest news

Balfour Beatty terminates Danny Sullivan labour deals

Around 500 workers on HS2 will be moved to alternative agencies or be taken on direct
2 days ago

Trio face prosecution after Hinkley site death

Main contractors and client to face charges over death of site supervisor
2 days ago

Buyers see recovery in house building sector

But civil and commercial work still in the doldrums
3 days ago

Apprentice saws-off thumb on hotel refurb site

Court hears how digit was reattached and teenager continued training with another firm
3 days ago

Laing O’Rourke tops June contracts league

£919m animal super lab dominates new orders
3 days ago

TSL turnover smashes £500m as profit almost trebles

Data centre and logistics contractor rises high on surging demand
3 days ago

Gleeson Homes chief exec leaves business after restructure

Management revamp after "challenging" year
3 days ago

Green light for 1,600-home Oldham town centre overhaul

Plans for over 1,600 homes across six regeneration sites approved
3 days ago

DSM wins Norwich city centre clearance job

Anglia Square shopping centre clearance for £300m scheme
3 days ago

13-year-old becomes UK’s youngest qualified digger driver

Grandson of Gallagher Group chairman sets industry record
3 days ago

Cubby reborn in £12m Svella-backed takeover

£50m revenue target set as 14 firms combine under new Cubby Group banner
4 days ago

North East NHS trusts plot £3bn health estate overhaul

Market engagement begins for major construction push across four trusts
4 days ago

HG goes green on cranes in £1.2m switch to battery power

Diesel-free crane drive cuts fuel bills by 94%
4 days ago

Developer fined £165,000 for fire safety failings

Firm ignored fire safety orders on apartment job in Preston
4 days ago

Bidding to start for £1.8bn North West framework

Contractors invited to bid for latest Procure Partnerships deal
4 days ago

Hill hits record £90m profit as homes pipeline swells

Build-to-rent push and £4.8bn contracting book to fuel next growth phase
4 days ago

Rayner unveils £39bn plan to build 300,000 social homes

Council building revival and rent reform feature in social and affordable homes plan
5 days ago

Keltbray bounces back with £3.2m profit

Tighter controls and smarter project selection fuel strong turnaround
5 days ago

VINCI JV wins 500-home twin town centre revamps

Chester Northgate phase 2 and Northwich Weaver Square schemes move to delivery stage
5 days ago

80 energy projects unlocked as Ofgem backs grid expansion

£24bn energy networks deal gets green light from regulator
6 days ago

How to see your stories on the Enquirer

Join our Suppliers and Buyers directory to get your news published
5 days ago

Henley lands Midland Mill revamp on Leeds tower scheme

Restoration of 18th-century mill kicks off on South Bank regeneration project
5 days ago

New boss at Eric Wright Civil Engineering

Gavin Hulme takes top job as Diane Bourne moves to group role
5 days ago

Pinewood submits £1bn data centre plan

Studio giant adds green and learning spaces to tech hub blueprint
6 days ago

Record results after TClarke goes private

Britain's biggest M&E contractor flourishes after de-listing
6 days ago

Dalkia lands £200m nuclear maintenance deal

1,000 nuclear FM staff to join M&E contractor
6 days ago

Construction comeback to outpace wider economy

Arcadis forecast fueled by spending review optimism
7 days ago

First steel goes up on giant car battery site

Severfield gets to work on McAlpine Somerset site
6 days ago

Permasteelisa wins cladding deal on Bovis city tower

Facade specialist lands package at 60 Gracechurch Street
6 days ago

Fox buys recycled asphalt specialist Fisher

Acquisition adds major recycled asphalt capacity in north west
6 days ago