Housebuilder Berkeley Group announced a rise in pre tax profits
Last Friday 8th December 2017 The Berkeley Group Holdings plc announced its unaudited interim results for the six months ended 31 October 2017. The company posted a 36% rise in their pre-tax profits to £533.3m in the six months to 31 October, also revenue grew 14% to £1.6bn.
The housebuilder upgraded its long-term forecast off the back of strong demand in the South East, however the firm warns of political uncertainty hanging over the property market.
Berkeley highlighted that 2,117 homes delivered – includes more than 10% of London’s new private and affordable homes.
In the outlook section of the announcement Rob Perrins Chief Executive mentioned the following:
Berkeley’s unique operating model, which reflects the cyclical nature of the housing market and always prioritises quality and financial strength, means that we are well positioned at this time of macro uncertainty. While trading has been sufficiently robust to support an increase in our earnings guidance, we are appropriately cautious in our investment strategy at present. We remain prepared to take on operational risk for the right opportunities, but this will be balanced by reduced overall financial risk while the uncertainty prevails and until we have sufficient visibility to invest more decisively.
This means that Berkeley anticipates being broadly working capital neutral as this reduced level of new investment is supplemented by the costs associated with bringing forward the 12,895 conditional plots in the land bank and residual payments on existing owned land holdings.
The fundamentals of the market in London and the South East remain strong and Berkeley remains committed to continuing its prominent position in delivering new homes of all tenures to Londoners. The focus at present is working hard with our partners and stakeholders to ensure we have the right planning consents to deliver the best outcome to address London’s housing challenge, reflecting the risks in today’s market.
Read the announcement 8th December 2017 unaudited interim results in full click here.