Construction: Record first half for house builder Bovis
13:13 18 August 2014
House builder Bovis Homes today reported a record number of completions in the first six months of the year as it took advantage of a buoyant property market.
The company said legal completions jumped 54% to 1,487 homes in the half year to June 30, as it saw pre-tax profit more than double, rising 166% to £49.4million.
The group, which concentrates on family housing in the South East, said the average selling price for private housing during the period was £239,500, 20% up on the same period a year ago.
Bovis said: “In the first half of 2014, the UK housing market has continued to be robust, with a solid level of mortgage availability and positive home buyer confidence.”
It said consumer confidence had been buoyed by the Government’s Help to Buy scheme. However there had been a “moderation of sales activity” late in the second quarter and into the early part of the current trading period which was “a return to more normal seasonal patterns”.
Bovis, which currently has more than a dozen developments in the eastern region, including sites in Colchester, Takeley and Elsenham, said it had almost fully sold its 3,650-home target for the year, adding that average selling prices for private and social housing would range between £210,000 and £215,000 overall for 2014.
The business said that due to strong trading it planned to boost its dividend and almost double the amount of houses it built to between 5,000 and 6,000 “over the next few years.”
Bovis said it will lift its dividend to 35p a share this year, including a half-year pay-out tripling to 12p. It added that it intends to pay at least 35p a share as a dividend next year.
Chief executive David Ritchie said: “The group is delivering on its growth strategy and combined with housing market improvements is producing fast improving returns.”
Brokers at Panmure Gordon welcomed the update from Bovis and said the firm was its “key housebuilding pick.”