Bellway has outlined its hopes for greater clarity and support from the next government on UK housing delivery – as the developer positions itself for a return to growth in the new financial year.
The housebuilder is currently on track to deliver around 7,500 homes for the year, down from 10,945 at 31 July 2023, as well as a reduction in its underlying operating margin.
It said while cost pressures are less than last year, high inflation costs in earlier periods carried over into work-in-progress will impact group income in the months ahead.
The company is looking to political leaders vying for power in the general election to guide and steer the sector through future challenges.
“We remain alert to future potential risks to customer demand and cost inflation, and in the coming weeks there may be a temporary impact to trading as political campaigning continues,” said group finance director, Keith Adey.
“Notwithstanding this, the outlook is improving and there is cross-party political support for increasing the supply of housing across the country.
“The long-term housing market fundamentals remain positive, and we are hopeful these will be bolstered by greater clarity over planning and housing policy beyond the upcoming General Election.”
Bellway said it had seen stronger trading through the Spring compared to the first half of the current financial year, adding there are good levels of material and subcontractor availability across the business.
The group’s forward order book at 2 June was 5,346 homes, down from 6,172 at the same time last year, with a value of £1.4 billion (FY2023: £1.7 billion).
In a trading update to 2 June, the group declared net debt of £57 million (FY2023: £42 million net cash).
A word from the top
“Bellway has delivered a solid trading performance supported by improved affordability and a seasonal uplift through the spring, and we remain on track to deliver full year volume output of around 7,500 homes,” said group chief executive, Jason Honeyman.
“We have been encouraged by ongoing healthy levels of customer interest and combined with the strength of our outlet opening programme, we continue to expect a year-on-year increase in the forward order book at 31 July 2024. As a result, Bellway remains in a strong position to return to growth in financial year 2025.
“We reiterate our confidence that the group’s robust balance sheet and operational strength, combined with the depth of our land bank, will enable Bellway to successfully capitalise on future growth opportunities.”
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