Housebuilder sees profit margins rise and is confident for 2011
Housebuilder Bovis Homes has seen a rise in profit margins and expects sales to increase in 2011.
In an interim management statement published today covering the period from 1 July the company says that it has maintained a solid sales rate despite the challenging market and lack of mortgages.
The group has succeeded in achieving sales prices above its internal target levels and expects the average sales price in 2010 to be around £160,000, 3% ahead of last year’s average.
This has generated improvements in gross and operating profit margins and the firm says it anticipates that its 2010 operating margin will exceed the previous year’s level of 6.2%.
From 1 July to 5 November the group has achieved 1,900 home sales which are anticipated to legally complete during 2010.
In the second half f the year Bovis Homes added 1,381 consented plots to its land bank, of which 92% are located in the south of England.
This brings the total number of consented plots added in 2010 to 3,255 at a cost of £182 million.
Looking forward the company said whilst there remains uncertainty concerning the near term direction of house prices, the fundamental demand and supply drivers of the housing market remain positive which should support volume and prices in the medium term.