Advertisement

Berkeley helped by London housing market in first half

House builder Berkeley Group saw revenue and profit surge in the first half, as it declared an interim dividend of 15p per share, compared with nil the year before.

House builder Berkeley Group saw revenue and profit surge in the first half, as it declared an interim dividend of 15p per share, compared with nil the year before.

Revenue jumped 69.4% from £404.9 to £686m in the six months to October 31st, as a result of the sale of residential homes across mix-use developments in London and the South East.

Advertisement - Article continues below

The company sold 1,927 new homes during the period, compared with 1,506 in the first half of last year, with the average selling price jumping from £254,000 to £335,000. This substantial increase in prices was down to the increased proportion of homes in London.

Meanwhile profit before tax increased by 40.7% from £101.1 to £142.2m.

The company said that demand for residential property in good locations remained strong in the first half in spite of an uncertain backdrop and economic contraction in the UK this year.

"These results, delivered in an uncertain market, demonstrate the value created by acquiring land at the right point in the economic cycle," said Chairman A W Pidgley.

"The quality of the land bank, enhanced by the planning consents achieved and further investment in construction, means that Berkeley remains on track to return £568m in cash to shareholders by no later than the first milestone date of September 30th 2015."

Pidgley said that Berkeley's strategy has been to focus on London and the South East, "markets which it knows and understands".

He said: "London in particular is a city which remains a world centre of excellence, culture and business, and is central not just to Berkeley but to a recovery in the wider UK economy, and is where we are proud to operate."

The company's net debt stood at just £5.5m at the end of the period, compared with £57.9m at the start of the financial year, as cash inflows surged.

Advertisement
Advertisement

Recommended

Broker safety – your questions answered
Investment strategy

Broker safety – your questions answered

Cris Sholto Heaton answers more of your questions about the safety of stockbroker accounts
25 Mar 2020
How demographics affects stock valuations
Investment strategy

How demographics affects stock valuations

New research suggests that stock and bond valuations are driven by the age of the population – at least in the US.
24 Feb 2020
Do you own shares in Sirius Minerals? Here’s what you need to do now
Stocks and shares

Do you own shares in Sirius Minerals? Here’s what you need to do now

Mining giant Anglo American has proposed a cash takeover of Yorkshire-based minnow Sirius Minerals. Unhappy shareholders must decide whether to accept…
20 Feb 2020
Why investors should be “cautiously bullish” for 2020
Stockmarkets

Why investors should be “cautiously bullish” for 2020

Analysts have been out in force making rosy predictions for stockmarkets in 2020, but while there is certainly a case for optimism, investors should r…
17 Jan 2020

Most Popular

What gold, bonds and tech stocks have in common
Stockmarkets

What gold, bonds and tech stocks have in common

"Risk off" or "safe haven" assets such as gold and government bonds have been doing well lately. But so have riskier tech stocks. That seems to defy c…
10 Jul 2020
An economics lesson from my barber
Inflation

An economics lesson from my barber

On reopening his shop after lockdown, Dominic Frisby’s barber doubled his prices. It’s all part of the post-Covid inflation process – and we’re going …
8 Jul 2020
Share tips of the week
Share tips

Share tips of the week

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
10 Jul 2020