Announcing a pre-tax profit rise of 26% to £67.1m in the year to 31 May 1999, chief executive Andrew MacKenzie described the market as “sensible but buoyant”. He said: “The shortage of new housing, while not desirable, is keeping demand high and providing a stimulus for sales price increases.” House prices for the company’s southern division rose 16% to £151 000, whereas the average price in its three northern regional companies rose just 3% to £123 000. Average prices, including the rest of England and Scotland, were up 8% to £134 700 overall.
Most of Bryant’s work in the South is outside the M25; MacKenzie said the group had no plans to move into the rapidly overheating central London market. “It is more risky and entails higher capital,” he said.
One analyst said the City would be reassured by Bryant’s return to form in the South because the region accounted for more than one-third of its completions and would provide its main profit in the short term.
“They had lost their way here in recent years by making prices too expensive and putting too much into fittings that customers simply didn’t want. But they seem to have calmed the niggling doubts,” he said.
Bryant has also increased its strategic landbank to 3880 ha. Half of this land is in the South, which MacKenzie says will help counter the land supply shortages in the South-east.
The shortage of new housing is keeping demand high
Andrew Mackenzie, Bryant
Operating margins for the group’s homes division were also up to 13.7% from 12.1% in the previous 12 months. However, MacKenzie warned that the firm would not achieve the 18% margins it saw in the late 1980s. “The current climate of low inflation makes us a more sustainable proposition than 10 years ago,” he said.
Completions edged up to 3904 from 3895, and the group predicted a 5% rise to 4200 for the next year.
Bryant’s small construction operation continued to do badly, with operating profit down from £1.7m to £1.5m over the year. MacKenzie said the division’s management had been reorganised, adding that future work would be focused on the Midlands.
MacKenzie insisted that there were no plans to sell the construction arm and flatly denied rumours that the company was in talks with Newcastle-based developer and housebuilder Cussins.