MJ Gleeson’s chief executive has blamed his company’s exposure to the flagging north-west England market for its poor results in the second half of 2007.
The housing and regeneration group, which offloaded its building arm in July 2005 with debts of about £50m as part of a management buyout, posted a pre-tax loss of £315,000, compared with a £275,000 loss in 2006. Turnover fell from £78.9m to £48.9m.
Paul Wallwork said: “With a national spread the results would have been better. The areas where we operate are proving very difficult.”
He added that the company’s exposure to schemes where the tenants were at the lower end of the social scale had also hit figures.
“These first-time buyers are more dependent on banks. The banks have taken a decision to rein in mortgages, but they have to get back to a more realistic position soon.”
Turnover was stagnant, owing to the weak property market, but Wallwork said he was “ready to pounce” over the next two years when the right deal came along. “We have cash in the bank and our debt facilities are unused. It’s a fantastic position to be in but buying land at the moment is too risky.”