Bellway p.l.c.
Trading Update
Friday 5 February 2010
Bellway is today issuing an update following the first six months of trading
which ended on 31 January and prior to the announcement of the interim results
on Wednesday 24 March.
The Group completed the sale of 2,247 homes (2009 : 2,014) at an average
selling price of £156,000 (2009 : £156,146), with the operating margin for the
six months being around 6% (2009 : 9.2% before exceptional items). The margin
for the full year is estimated to be at the higher end of the 6% - 7% range. It
is anticipated that there will be no exceptional items included in the interim
results (2009 : £66.3 million).
The order book at 31 January stood at £390 million (2009 : £296 million),
representing 2,506 homes (2009 : 2,173) of which 706 (2009 : 665) are for the
following financial year. The Group has now sold or reserved 92% (2009 : 81%)
of this year's current target and the next six weeks' reservation pattern will
determine whether this target will be increased. Reservations in the first six
months have averaged 85 per week which compares to 65 in the same period last
year and 104 from February to July 2009.
The Group has a strong balance sheet with a net cash position of £61 million
which was helped by a significant reduction in our stock of unsold properties
compared to last year and we are now selectively investing in both work in
progress and land opportunities thereby increasing the capacity for future
growth. Since the beginning of the financial year, Bellway has spent around £76
million on land, predominantly in the south and has terms agreed on a further £
123 million. As new planning permissions are granted, our divisions are
gradually opening up more sites and this should result in an increase in the
number of sales outlets to around 190 by the year end compared to an average of
175 in the first six months.
Historically there is always an uplift in weekly home reservations as the
traditional spring selling season unfolds. However, with mortgage providers
continuing to require a high level of deposit, particularly for first time
buyers, we expect trading conditions during the first half of 2010 to be
subdued relative to historic levels.
Nevertheless, the Board considers that the Group is currently well positioned
and is trading profitably with a high level of targeted output already secured
and no borrowings. This should enable Bellway to take advantage of
opportunities as and when they arise.
Certain statements in this announcement are forward-looking statements which
are based on Bellway plc's expectations, intentions and projections regarding
its future performance, anticipated events or trends and other matters that are
not historical facts. Such forward-looking statements can be identified by the
fact that they do not relate only to historical or current facts.
Forward-looking statements sometimes use words such as "aim", "anticipate",
"target", "expect", "estimate", "intend", "plan", "goal", "believe", or other
words of similar meaning. These statements are not guarantees of future
performance and are subject to known and unknown risks, uncertainties and other
factors that could cause actual results to differ materially from those
expressed or implied by such forward-looking statements. Given these risks and
uncertainties, prospective investors are cautioned not to place undue reliance
on forward-looking statements. Forward-looking statements speak only as of the
date of such statements and, except as required by applicable law, Bellway plc
undertakes no obligation to update or revise publicly any forward-looking
statements, whether as a result of new information, future events or otherwise.
FOR FURTHER INFORMATION PLEASE CONTACT:
JOHN WATSON, CHIEF EXECUTIVE & ALISTAIR LEITCH, GROUP FINANCE DIRECTOR FROM
8.00 AM ONWARDS ON 0191 217 0717