Housebuilder reports 14% drop in interim pre-tax profit, as Wilson family considers options
Wilson Bowden was at the centre of takeover speculation as it posted a disappointing set of interim results with pre-tax profit falling 14%.
Earlier this week, HBOS was rumoured to be considering putting in an offer for the housebuilder.
Ian Robertson, housebuilder’s chief executive, said he could not comment on the story but said the Wilson family were continuing to review their holding in the company.
Robertson remained upbeat despite the results, saying: “The figures are in line with what we expected and what we were telling the market. We knew there were not going to be as many site openings in the first half.”
He added that the results had been affected by the cost of integrating its latest acquisition, Roland Bardsley Homes, which Wilson Bowden bought for £50m at the end of April. The accounts showed that this process had cost £1.2m.
Pre-tax profit dropped 14% to £85m for the first six months to 30 June 2006 and turnover fell 5.4% to £525m.
The company’s share price fell two percentage points to 1717p in the first hour of trading.
Robertson said Wilson Bowden could still deliver good final year results. He said: “We have a good order book for the second half and there will be increased site openings and that’s how we are going to deliver growth in the second half.”
Analysts are predicting that Wilson Bowden’s full year profit before tax will be about the same level as last year. For the year ending March 2006 the housebuilder posted a pre-tax profit of £223m, which was a 14% fall on the previous year.
The forward order book has 2266 reservations with a sales value of £387m, up from 1488 reservations with a value of £270m.
Meanwhile operating profit at subsidiary David Wilson Homes fell 18% to £74m and completions also dropped to 2135 from 2190.
David Wilson, the chairman of Wilson Bowden, said improving sentiment in the housing market put the firm in a strong position for the second half of the year.