Strong construction activity contributes to 55% increase in group revenue but property devaluations hit pre-tax profit

Henry Boot, the property development and construction plant hire firm, has announced a 59% fall in profit in its end-of-year results.

Pre-tax profit fell to £19.3m from £46.5m in 2007, although trading profits increased 53% to £44m, compared with £28.8m in 2007. Revaluations took £19.6m off pre-tax profit, £14.9m of this from the revaluation of a shopping centre at Ayr.

Revenue for the group rose 55% to £193.7m from £124.8m in 2007, as a result of large land transactions and strong activity in the construction division.

Gearing reduced by one-third to 26%, with net debt of £49.3m at the year end. This compares with gearing of 39% and net debt of £70.9m a year earlier.

John Reis
Reis: "solid results, with the exception of our investment property portfolio"

Chairman John Reis said he was pleased with the results given the difficult market conditions, but noted the firm's investment property portfolio had seen falling values throughout the year because of the downturn.

He said: “Given the very difficult market conditions that have arisen in the UK property market during 2008, I am pleased to report a further set of solid results, with the exception of our investment property portfolio where we have seen falling values throughout the year.”

“Our broad mix of businesses and prudently geared balance sheet, allied to a cautious strategy, gives the board confidence that we will manage the next phase of the cycle successfully and deliver growing value to shareholders once again.”