Bellway keeps costs under control; see FY in line
Bellway
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16:40 23/04/24
House builder Bellway said full year earnings growth would be in line with expectations, adding that costs were under control, helping to ease gross margin pressures.
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While house prices in general remained firm, “the benefit of house price inflation continues to diminish”, the company said in a trading update.
Costs in the sector have risen due to the Brexit-induced slump in the pound, while consumers have been wary about committing to house purchases as confidence declines.
Bellway said demand was still strong, supported by high levels of employment, low interest rates and the continued availability of the government's Help to Buy scheme.
The weekly reservation rate increased 4.7% to 244 in the five months to June 2, reflecting a strong Spring selling season.
“Customer confidence is resilient and despite the ongoing political uncertainty, the cancellation rate since August 1 has moderated to 12%, a reduction from the 13% reported in March,” Bellway said.
The company's forward order book rose by 2.7% to 6,312 homes, with 68% of plots contracted. Bellway said the value of the book was modestly lower at £1.64bn, compared with £1.7bn last year, reflecting planned growth in lower value social completions this year.