Housebuilder Bovis’s customer rating improves as profits reach all-time high

Bovis Homes showed its best profits ever today as it recovered from a scandal in the quality of its building.

The figures

Revenue stood at £1.06bn in 2018, a 3.2 per cent increase on the year before, Bovis told shareholders this morning.

Meanwhile pre-tax profits grew an impressive 47 per cent to £168m, ahead of market expectations, the company said.

However, regardless, its net cash position has fallen nearly 13 per cent to £127m.

Why it’s interesting

Shareholders were given a boost this morning as the board agreed to hike dividends by 20 per cent to 57p for the 2018 financial year.

It comes after Bovis faced a difficult time with the quality of its building.

The company was awarded a four-star housebuilder certificate last year by the Home Builders Federation, up from just two stars in 2017.

The system asks customers whether they would recommend their builder to a friend. In 2018 between 80 and 90 per cent of customers said they would recommend Bovis, up from just 60 to 70 per cent the year before.

However, despite seemingly good news shares were largely unaffected, as investors seemed unsurprised by the news.

The company had already given markets a heads-up that it was expecting record profits ahead of market consensus in January.

Bovis said it has already secured business which would supply 48 per cent of its market consensus 2019 revenues.

What Bovis said

Chief executive Greg Fitzgerald said: “Customer satisfaction has been at the core of all we have done during 2018 and we expect to achieve our target of a four-star HBF customer satisfaction rating for 2018, a significant improvement from our two-star HBF customer satisfaction rating in 2017.

“This shift in quality is reflected across all of our housing delivery and in the feedback we receive from our private customers and housing association partners.”

He added: “Looking ahead, we are implementing many initiatives which will continue to build a better Bovis Homes including our new Phoenix housing range with its first completions this Spring, and the development of our new partnership housing division. We have a strong sales position and excellent land visibility and expect to make further operational and financial progress in 2019.”