Britain’s fourth biggest housebuilder reveals plans as it posts 15% rise in interim profit to £101m

Bellway Homes is launching divisions in the Thames Valley and South Yorkshire as part of an expansion drive.

Alistair Leitch, Bellway’s finance director, told Building that the company intended to move quickly to establish permanent offices in the regions.

He said: “We already have someone looking for sites in the Thames Valley, and have someone in place to organise the division.”

The expansion may be part of an attempt to forestall a takeover of the company.

There has been increasing speculation that Bellway, which is the UK’s fourth largest housebuilder, may be the next victim of the housebuilding sector’s continuing consolidation drive. Leitch said this week that it would take a “big argument and an even bigger chequebook” for anyone to buy the company.

He added that Bellway would consider making an acquisition itself if a firm’s share price represented “proper value”.

The expansion is also likely to raise the firm’s margins. Bellway specialises in low-cost housing and is strong in northern England, where house prices tend to be less than the national average. This would be offset by developments in the more highly priced Thames Valley area.

Bellway’s results for the six months to 31 January, announced this week, showed that its margins fell slightly to 19% from 18.7% in the same period the previous year.

Its pre-tax profit was £101m, a rise of 15% on the £88m it recorded in the corresponding period in 2005/06. Turnover rose 14% to £577m and sales increased 10% to 3,264.

The firm, which has its headquarters in Newcastle upon Tyne, has 18 divisions in England, Scotland and Wales.