Bellway profit up 57%

Housebuilder Bellway has reported a 57% increase in pre-tax profit over the last year driven by growth in the south of England and London.

In the year to 31 July 2012 the firm reported a profit of £105m, up from £67m in 2011.

The housebuilder also saw a rise in turnover from £886m in 2011 to £1bn in 2012.

Howard Dawe, chair of Bellway, said: “Consumer demand for new homes has shown continued resilience and this … has enabled Bellway to deliver its third successive year of growth in volume, average selling price and operating margin.”

He added that strong performance in the south, which accounted for 63% of house sales in 2012, and an increase in private completions were key to the group’s financial performance.

John Watson, chief executive of Bellway, added: “You never see all markets responding at the same time. It’s like a pendulum, this year it might swing back to the north.” He added that the current housing market was “stable” and “robust”.

Dawe said the outlook was good given a rise in reservations driven by the government’s NewBuy scheme, which provides high loan to value mortgage products.

Watson added: “The main risk is the unemployment level. When you’ve got the threat of losing your job the last thing you are thinking about is moving house.”

He said the firm was not actively looking for other house builders to acquire and would continue to pursue a strategy of organic growth, though it would consider aquisitions of businesses with attractive land banks if the opportunity arose.

Watson added the other big challenge for the firm over the next year was to maintain its presence in the London boroughs, where Bellway has 25 outlets.

Bellway completed 5,226 sales in 2012, up from 4,922 in 2011. Plus, the average selling price of Bellway’s homes rose to £186,648 in 2012, up from £175,613 in 2011.