Bellway confident of further growth as profits top £560m

Bellway Site workersStrong appetite for newly built homes has helped Bellway deliver a forecast-beating set of final results.

The FTSE 250-listed housebuilder achieved an 11% rise in completions to deliver a record 9,644 homes this year.

This lifted revenue 14% in the year-end to July to £2.56 billion, building a pre-tax profit of £571 million from £498m previously.

Operating margin rose to a record 22.3% with the house builder forecasting further growth next year.

Based on forward orders, Bellway said it was confident it could grow volumes 5% next year, taking the firm through the 10,000 homes ceiling.

It will also open a 20th trading division in the north of England in coming months building on fledgling division openings in Coventry and County Durham last year.

Executive chairman John Watson, who has temporarily taken the position while Ted Ayres is on sick leave, said: “The group has increased its contribution to the supply of much needed new homes while upholding high standards in both customer care and health and safety.

“Bellway has invested significantly in land, maintaining its rigorous and disciplined investment criteria and with a strong balance sheet and focus on operational delivery, I am confident that the group is well positioned to deliver further growth, this year and beyond.”

Jason Honeyman, who joined the board as chief operating officer last month, added: “Whilst there is some reliance upon overseas labour, predominantly in the southeast and London, there is no evidence that this valuable resource has diminished as negotiations to leave the EU progress.”

The total number of new homes sold was 9,644 (2016: £8,721), of which 7,567 were private sales and 2,077 were social housing (2016: 7,325 and 1,376 respectively).

The board expects a further 5% increase in average selling price to £280,000 this year and it also expects to grow volume by at least 5%.

Over the past year, the northern divisions increased output by 11.2% to 4,655 homes (2016: 4,187 homes). Output in the south grew by 10% to 4,989 homes (2016: 4,534 homes).

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