Increase in housing completions and margins set to boost results
Contractor Galliford Try has said it expects its half year pre-tax profit to exceed board expectations.
In a statement to the City the firm said its housebuilding division would see an increase in revenue this year because of record numbers of completions in the last six months and an increased average selling price.
During the six months to 31 December 2012 the firm recorded 1,364 completions up from the year before. It’s average selling price also rose to £248,000, up from £239,000 in the same period last year.
The firm said it expected its operating margin for housebuilding to increase.
It said the housing market in the south of England, one of its key markets, continued to be stable. It added: “Mortgage availability continues to be an issue but is improving.”
The firm also reported it had already secured 99% of its projected annual revenue for its construction division by the end of 2012, six months into its 2012-13 financial year.
It said it had seen a greater proportion of its construction orders coming from the private sector making up 18% of its £1.6bn order book, up from 14% in 2011.
Chief executive Greg Fitzgerald said: “We are encouraged by the performance of both housebuilding and construction in the first half of the financial year with profits ahead of board expectations.
“Housebuilding continues to deliver good results in a stable market with construction performing well against a backdrop of a difficult market. We continue to manage cash with group net debt improving on last year.”