HOUSING group Cala set out ambitious plans yesterday to double in size over the next four years by snapping up land in the south of England and increasing its presence in its Scottish heartland.
The firm, which develops upmarket properties in Scotland, the Midlands and south east England, was taken over in March by Legal & General and private equity firm Patron Capital in a £210m deal.
Chief executive Alan Brown said its new owners have agreed to inject further cash into the business to fund its expansion following signs of improvement in the market.
“The market has stabilised, the National Planning Policy Framework (NPPF) is bringing a lot more land supply, and Patron expressed their wish to invest more money if we could find ways to use that investment,” Brown told City A.M.
As part of this cash infusion, Cala will also push ahead with the development of 2,000 homes near Winchester after winning a prolonged battle with the government over the controversial site last year.
Brown’s comments came as the company posted a 37 per cent jump in pre-tax profits to £12.5m in the year to 30 June compared with the previous year.
Cala said the record performance was driven by a four per cent rise in private completions to 694 homes and an increase in sales gross margins – from 16.4 per cent to 18.8 per cent.
Total group revenues fell five per cent to £240.8m, which Brown attributed to lower turnover from land sales and selling the last of its commercial property assets in 2012 .
“With the backing of new and supportive partners Cala now has greater balance sheet capacity, putting the Group in a strong position from which to continue the positive momentum generated in recent years,” the group said in a statement.