Cala slumps into red after being hit with £20m fire safety bill

Housebuilder Cala Group slumped into the red last year after being hit with more than £20m of building safety costs.

The Edinburgh-based, private-equity owned firm said it racked up a pre-tax loss of £16m from a £20m profit last time after exceptional items totalled nearly £26m during the year.

It said £20.5m of these costs were for fire safety remediation work while a further £3.5m was spent on restructuring costs “following a strategic review of the business”.

Pre-tax profit before exceptional items dropped from £78m to £9m, the firm’s accounts added.

The group said overall turnover fell 9% to £1.1bn, with completions down from 2,861 homes to 2,516 homes. Cala said it started work on 22 new sites in the year, which will deliver 1,735 homes.

In the accounts, which were signed off last month, chief executive Tom Nicholson said average weekly reservation rates in the first half of 2026 had been “disappointing”.

He added: “In the first 26 weeks we have traded at a rate of 0.51 weekly sales per development, with 897 net private reservations taken.

“This rate is behind the equivalent period in 2025 (0.73) albeit sales pricing over the first 26 weeks is broadly in line with budget expectations.” He said he expected the subdued market conditions to continue throughout the remainder of the year.

But he added: “We are encouraged by the level of interest in our developments in 2026 so far, reflected in both enquiries and website activity and with increased political stability we are confident that we can capitalise on this interest.”

Previously owned by L&G, Cala was bought by Sixth Street Partners and Patron Capital Advisors two years ago.