Bloomberg News

Bellway Says Its First-Half Profit Rose as Prices Increased

March 27, 2012

Bellway Plc (BWY), the U.K.’s fourth- largest homebuilder by volume, said its first-half profit rose after the company sold properties at higher average prices.

Net income climbed to 30.4 million pounds ($49 million) in the six months through January from 18.5 million pounds a year earlier, the Newcastle, England-based company said today in a statement. The operating margin gained 320 basis points to 10.1 percent after Bellway built on cheaper land acquired during the recession.

“There remains an underlying demand for our homes,” Chairman Howard Dawe said in the statement. “The group therefore intends to continue its three pronged strategy of delivering volume, selling price and operating margin growth.”

Homebuilders are widening their profit margins by focusing more on houses and developing land bought after prices fell in the recession that ended in 2009. The U.K. government is trying to spur construction after homebuilding in England and Wales fell in 2010 to the lowest during peacetime since 1924.

Revenue increased 12 percent to 459 million pounds as the average selling price gained 8.5 percent to 182,753 pounds. Bellway said it will pay a dividend of 6 pence per share, up from 3.7 pence a year earlier.

To contact the reporter on this story: Chris Spillane in London at cspillane3@bloomberg.net.

To contact the editor responsible for this story: Andrew Blackman at ablackman@bloomberg.net.


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