Housebuilder increases land purchases and says completions are ‘significantly ahead’
Bellway has reported a 76% increase in the value of its forward-order book for homes, and revealed that it has increased its spending on land by 48% over the past 12 months on the back of “robust demand”.
In an interim management statement today, the housebuilder said homes due for completion by the end of July were valued at £670m, up from 2013’s figure of £380m.
It said it had spent £400m on land and land creditors since the beginning of August last year, up from £270m for the period before.
Bellway said growing consumer confidence and a “strong supply of mortgage finance” were important factors, and that the government’s Help to Buy shared-equity scheme had been an “important selling incentive” that had accounted for 879 reservations since the beginning of February.
Chief executive Ted Ayres said the company was looking at a “significant opportunity for volume growth” based on the strong UK housing market and Bellway’s “disciplined approach” to land investment.
“The group has a substantial balance sheet and operational capacity for further expansion,” he said.
“Land with detailed planning permission is already in place to achieve next year’s volume growth aspirations.
“This strong position, together with a focus on improving return on capital employed, ensures that Bellway remains well placed to deliver further enhancement to shareholder value.”
Bellway added that it had reduced its bank net debt from £95m to £45m over the past 12 months.
Earier this year, the firm reported a 41 per cent increase in revenue for the six months to the end of January, rising to £690m from £486.7m for the same period in 2012/13.