Housebuilder Bellway has kept its shareholders happy. The company said it was on track to deliver a significant rise in sales and earnings for the first half building more homes and selling them at record prices.
The family-owned company, which builds homes across the country, completed 4,188 homes in the first half of the year to 31 January, up 11.6 per cent compared with 3,754 the same time last year.
Homes were sold at an average price of £257,000 – 17 per cent higher than the same time last year – mainly due to the completion of a number of high-end London flats together with a smaller proportion of lower value social housing completions.
Thanks to the strong trading performance, Bellway said it now expects housing revenue to jump by over 30 per cent and exceed £1bn for the first half the year. Shares have risen by 2.7 per cent to 2,550p on the back of the announcement.
Ted Ayres, chief executive, said:
We have achieved a strong performance for the half year to 31 January 2016, delivering a further increase in both volume and average selling price, which should result in a substantial rise in earnings. We have made a significant investment in land at attractive rates of return to secure future growth and this, together with the positive market conditions and government support for new housing, should lead to further value creation for our shareholders.
Bellway said it has been investing in higher value locations across the country in a bid to boost its average selling price and returns. It entered into contracts to buy 5,445 plots across 45 sites in the last six months, compared with 3,824 the same time last year.
Its current projects in London include a high end 510-home scheme in Nine Elms called The Residence, which will complete next year, and a collection of 50 apartments in Bentley Place which sits within the Brook Green conservation area in Hammersmith.
The company's order book stood at 4,434 homes at the end of the period worth £1.027bn, a rise of 5.3 per cent on the same time last year.