Land writedowns drag pre-tax profit down to last year's level despite 30% rise in turnover
Galliford Try has reported flat profit of just over £60m for the past year after being forced to make writedowns on its land values and taking a hit on redundancy costs.
The UK housing and construction firm, which reported a post-exceptional pre-tax profit of £60.3m for the year to 30 June 2008, compared with £60.2m the previous year, was hit by costs of £11.5m including £9.1m of land writedowns and abortive costs of site acquisitions and redundancy costs of £1.9m.
As previously announced, the group has restructured its housing division, where margins were trimmed from 14.5% to 11.1% as a result of market conditions, to make estimated savings of £12m a year.
However, the firm's construction and affordable housing businesses boosted its results, reporting record profit of £25.7m and £13.8m respectively. Overall, group turnover rose 30% to £1.8bn.
Chief executive Greg Fitzgerald said: “Our construction businesses have delivered a record performance, with increased profits and excellent cash generation. Whilst housebuilding has been affected by the severe downturn in the housing market, its effect has been mitigated by our early adoption of a policy of aggressive selling, our strengths in affordable housing and our concentration on managing our debt.”