Berkeley notes rising demand for new homes as profit drops
Housebuilder Berkeley has stated that it is ‘fully aligned with’ and ‘committed to’ the government’s ambitious housing agenda, despite a decline in annual profit.
The FTSE 250 company told markets this morning that its profit before tax fell 5.1 per cent in the last financial year, from £557.3m to £528.9m.
Its operating margin improved from 19.5 per cent to 20.1 per cent. It delivered 4,300 homes during the year.
Chief executive Rob Perkins said the company had an “excellent operational performance”.
“There is good underlying demand for our homes, with transaction volumes gradually improving over the course of the year.
“However, consumer confidence remains finely balanced and a more meaningful recovery requires both improved sentiment and macroeconomic stability,” Perrins said.
Berkeley said it was “fully committed to the government’s housing-led growth agenda” and was submitting planning applications on all its sites to “accelerate delivery”.
The company noted its commitment to developing brownfield sites, with 92 per cent of the 4,300 homes delivered during the year on regenerated brownfield land.
“Berkeley is the only large UK homebuilder with a business model that prioritises brownfield development and is unique in having the expertise and resources to unlock complex urban sites and their significant economic and social value,” Perrins said.
The company holds £6.7bn in land, with “strong planning momentum” during the year, it said.
Chair Michael Dobson steps down
In addition to its annual results, Berkeley told the market this morning that its chair, Michael Dobson, would step down in September, after three years in the role.
Perrins, who has been Berkeley’s CEO since 2009, will be appointed executive chair, while chief financial officer Richard Stearn will become CEO.
“The board would like to thank Mike for his outstanding leadership over the last three years which has seen a number of important developments for Berkeley during a period of heightened geo-political and macro-economic volatility,” Berkeley said.
The company added that it was “very conscious” of the “complexity of today’s operating market”.
“The current executive team [is key] to maintaining Berkeley’s unique business model and culture to drive long-term value for shareholders, while also recognising the need to formulate and execute a successful succession strategy,” it said.