Bellway hikes dividend as revenues jump despite Brexit knock on confidence
Bellway posted a double-digit rise in revenues this morning, shrugging off fears of Brexit uncertainty as cheap borrowing, high employment and the government’s Help to Buy scheme all provided a boon for the housebuilder over the last six months.
In its interim results for the half-year to to 31 January 2019, the FTSE 250 developer posted a rise in both revenue and pre-tax profits, with its boss saying that "conditions in the new build UK housing market remain positive".
Michael Van Dulken, head of research at Accendo Markets, summed up the results as "mixed", highlighting the Brexit threat to material supply but also the firm’s efforts to mitigate such problems.
Revenues in the six months to the end of January 2019 hit £1.49bn, rising 12.4 per cent from the same period in the previous year.
Meanwhile, pre-tax profits climbed 8.3 per cent to £313.9m and gross profit rose 9.6 per cent to £377.5m.
However, the Newcastle-based firm's cancellation rate rose from 11 per cent to 13 per cent, with Bellway pointing the finger at a "slight moderation in customer confidence" in the wake of Britain's imminent departure from the EU.
The group also issued a five per cent rise in the interim dividend to 50.4p per share.
Home completions hit 5,007, marking a 5.6 per cent jump from the second half of 2018.
What the group said
Chairman Paul Hampden Smith said: "Bellway retains significant capacity for further growth, both from its existing divisional structure and through the continued investment in new sites and divisions, where land opportunities meet or exceed the group's minimum return requirements. Accordingly, whilst Bellway can be flexible with regards to dividend payments, for the full financial year the board expects to maintain a dividend cover of around three times earnings."