Bellway
p.l.c.
Trading
Update
Tuesday 11 February
2025
Bellway p.l.c. ('Bellway' or the 'Group') is
today issuing a trading update for the six months ended 31 January
2025 (the 'period') ahead of its Interim Results announcement on
Tuesday 25 March 2025.
Highlights
§ Growth in total
housing completions of 11.9% to 4,577 homes (2024 - 4,092) at an
average selling price of £310,600 (2024 - £309,278).
§ The private
reservation rate per outlet per week increased by 18.6% to 0.51
(2024 - 0.43), including a contribution from bulk sales of 0.06
(2024 - 0.03).
§ The Group has a
high-quality land bank and operated from an average of 248 outlets
in the period (2024 - 243).
§ The forward order
book at 31 January 2025 comprised 4,726 homes (2024 - 3,970 homes),
with a value of £1,311.5 million3 (2024 - £1,012.5
million).
§ In line with previous
guidance, the Group is on track to deliver full year volume output
of at least 8,500 homes (31 July 2024 - 7,654 homes) with output
weighted towards the first half.
§ Bellway has a strong
and well-capitalised balance sheet, with modest net debt of £8.0
million4 (2024 - net cash of £76.6 million), in line
with the Board's expectations.
Jason
Honeyman, Group Chief Executive, commented:
"Bellway has delivered a strong first half
performance in challenging market conditions. While mortgage
interest rates have increased modestly since the autumn, customer
demand has remained robust, and the Group has a healthy order book
to support our targeted growth in volume output for the full
year.
The Group has a strong balance sheet and land
bank, and we remain very well-positioned to capitalise on future
growth opportunities while continuing to play an important role in
meeting the growing need for new homes across the
country."
Results and
trading
The Group entered the current financial year
with a strengthened forward order book which supported an 11.9%
increase in volume output to 4,577 homes (2024 - 4,092). In
line with our expectations, the average selling price was slightly
ahead of the prior year period at £310,600 (2024 - £309,278) and
housing revenue increased by 12% to over £1.42 billion (2024 -
£1,265.6 million).
The private reservation rate was strongly ahead
of the prior year period at 127 per week (2024 - 105), with this
set against a weak comparator when mortgage rates were more
elevated. The private reservation rate per outlet per week
increased by 18.6% to 0.51 (2024 - 0.43), including a contribution
of 0.06 from bulk sales (2024 - 0.03). While we did not experience
a typical seasonal step-up in reservations during the autumn,
trading was stable throughout the first half and pricing has
remained firm across our regions. The overall reservation rate rose
by 14.3% to 160 per week (2024 - 140) and the cancellation rate
reduced to a normalised level of 14% (2024 - 16%).
The Group traded from an average of 248 outlets
during the period (2024 - 243) and was operating from 245 outlets
as at 31 January 2025. We remain on track to open over 30 new
outlets in the second half of the financial year and continue to
expect to operate from an average of around 245 outlets for the
full financial year (31 July 2024 - 245).
The forward order book at 31 January 2025
comprised 4,726 homes (2024 - 3,970 homes), with a value of
£1,311.5 million3 (2024 - £1,012.5
million).
Land
investment
Bellway has a high-quality land bank, and our
experienced teams have continued with a disciplined and targeted
approach to land acquisition. The Group contracted to purchase
5,246 owned and controlled plots (2024 - 1,237 plots) across 32
sites (2024 - 9 sites) during the period with a total contract
value of £378.2 million (2024 - £103.4 million). In addition, our
strategic land bank has been further strengthened to support our
long-term growth ambitions, with the Group entering into option
agreements to buy 11 sites (2024 - 10 sites).
Financial
position
The Group has a strong and well-capitalised
balance sheet, and we remain focused on maintaining financial
resilience through the cycle. Net debt at 31 January 2025 was
modest and in line with expectations at £8.0 million4
(2024 - net cash of £76.6 million) and our adjusted
gearing5, inclusive of land creditors, remains low (2024
- 4.7%).
Outlook
Supported by our healthy order book, the Group
remains on track to deliver full year volume output of at least
8,500 homes (31 July 2024 - 7,654 homes) with output weighted
towards the first half. We continue to expect the full year average
selling price to be around £310,000 (31 July 2024 - £307,909) and
the underlying operating margin to approach 11.0%6 (31
July 2024 - 10.0%).
While we have been encouraged by a seasonal
pick-up in customer enquiries and reservation rates in the early
weeks of the current spring selling season, we remain mindful of
the sensitivity of customer demand to mortgage affordability and
the evolving economic backdrop.
The long-term fundamentals of the UK
housebuilding industry remain positive, and we welcome the
Government's reforms to the planning system to drive a marked
increase in the supply of new homes across the country. We remain
confident that, given the Group's operational strengths and land
bank depth, Bellway remains very well-placed to deliver volume
growth in the years ahead to support ongoing value creation for
shareholders.
Notes:
1 All figures
relating to completions, order book, reservations, cancellations,
and average selling price exclude the Group's share of its joint
ventures unless otherwise stated.
2 Comparatives are
for the half-year ended 31 January 2024 or as at 31 January 2024
('2024') unless otherwise stated.
3 Order book is
the total expected sales value of reservations that have not
legally completed.
4 Net (debt)/cash
is cash plus cash equivalents, less debt financing.
5 Adjusted gearing
is the total of net (debt)/cash and land creditors divided by total
equity.
6 Underlying operating
margin is operating profit before net legacy building safety
expense and exceptional items divided by total revenue.
For further
information, please contact:
Bellway
p.l.c.
Shane Doherty, Chief Financial
Officer
Gavin Jago, Group Investor Relations
Director
0191 217 0717
Media
enquiries
Paul Lawler, Group Head of
Communications
paul.lawler@bellway.co.uk
07813 392 669
Sodali &
Co (Financial PR)
Justin Griffiths
Victoria Heslop
bellway@sodali.com
0207 250 1446
Certain statements in this announcement are forward-looking
statements which are based on Bellway p.l.c.'s expectations,
intentions and projections regarding its future performance,
anticipated events or trends and other matters that are not
historical facts. Such forward-looking statements can be
identified by the fact that they do not relate only to historical
or current facts. Forward-looking statements sometimes use
words such as 'aim', 'anticipate', 'target', 'expect', 'estimate',
'intend', 'plan', 'goal', 'believe', or other words of similar
meaning. These statements are not guarantees of future
performance and are subject to known and unknown risks,
uncertainties and other factors that could cause actual results to
differ materially from those expressed or implied by such
forward-looking statements. Given these risks and
uncertainties, prospective investors are cautioned not to place
undue reliance on forward-looking statements. Forward-looking
statements speak only as of the date of such statements and, except
as required by applicable law, Bellway p.l.c. undertakes no
obligation to update or revise publicly any forward-looking
statements, whether as a result of new information, future events
or otherwise.
