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Bovis upbeat about recovery progress
House builder Bovis was upbeat about its recovery from its December 2016 profit warning in a trading update issued for last year.
The builder continued to restructure its balance sheet and ended 2017 with a £145m net cash balance, exceeding the £100m expectation Bovis set itself when making plans for a recovery.
It remained tight-lipped, however, on profit levels, saying they were “in line with management expectations”.
Bovis completed 3,645 homes in the year, compared to 3,977 in 2016. Of these, 1,072 (29%) were affordable, a similar figure to 2016’s 1,074 affordable homes, which represented 27% of the total.
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Its update said it had “significantly reduced” its levels of stock and invested in changes to the way the company is run, but its sales rate of 0.48 average net private reservations per active outlet per week was well below the 2016 figure of 0.58.
The builder said it expected “to trend towards a more normal sales rate” in early 2018.
Its restructuring process has continued, with Bovis disposing of its entire shared equity portfolio to generate £27.6m. It has also reduced its level of part exchange properties by £30m and its stock properties by £10m.
Greg Fitzgerald, chief executive of Bovis, said: “There has been a step change in the quality of our homes delivered on completion and I’m pleased to see this reflected in our level of customer satisfaction which continues to improve.
“We’ve made excellent progress with our balance sheet restructuring, resulting in a year-end cash position significantly ahead of expectations. Our forward order position is strong, and with robust industry fundamentals, we expect the group to deliver a significant improvement in profitability in 2018.”
