Interim Results - 6 Months to 31 January 2000
Bellway PLC
12 April 2000
NATIONAL HOUSEBUILDER BELLWAY p.l.c. TODAY (WEDNESDAY 12 APRIL 2000) ANNOUNCE
THEIR INTERIM RESULTS FOR THE HALF YEAR ENDED 31 JANUARY 2000
THE CHAIRMAN SAID 'PROFIT BEFORE TAX LEAPT BY £9.2 MILLION TO £30.4 MILLION
........... AN INCREASE OF 43%'
HIGHLIGHTS
Half Year Half Year
Ended Ended
31 January 2000 31 January 1999
Profit before tax £30.4m £21.2m +43%
Turnover £249m £181m +38%
Homes sold 2,197 2,007 +9%
Average selling price £106,000 £89,100 +19%
Operating margin 13.2% 13.0% +2%
Operating profit £32.9m £23.4m +41%
Dividend per ordinary share 3.6p 3.3p +9%
Ordinary dividend cover 5.2x 3.8x
Basic earnings per ordinary 18.8p 12.6p +49%
share
Net asset value per ordinary 262p 226p +16%
share
CHAIRMAN'S STATEMENT
INTERIM RESULTS AND DIVIDEND
I am pleased to report an excellent set of results for the half year to 31
January 2000. Turnover rose by 38% to £249.4 million from £180.6 million and
profit before tax leapt by £9.2 million to £30.4 million from £21.2 million,
an increase of 43%. Homes sold in the period reached a new high of 2,197
rising from 2,007. Our average sales price broke the £100,000 barrier for the
first time reaching £106,000, 19% above the £89,100 achieved in the
comparable period last year. There was an improvement in the operating margin
to 13.2% and the return on average capital employed was 22.9%.
Basic earnings per share were 18.8p compared to 12.6p and the directors are
pleased to declare an interim dividend of 3.6p per ordinary share, an
increase of 9%. This dividend will be paid on 1 July 2000 to all ordinary
shareholders who are on the Register of Members on 9 June 2000.
TRADING
Since our flotation more than twenty years ago, we have been renowned for our
regional and site specific designs, unlike many of our competitors who are
using stereotyped national house designs. Our policy has been vindicated by
our consistent and enviable record. This is now further underlined by the
Government's recent Planning Policy Guidance Note requiring good design and
layout to make the best use of brownfield land and thus improve the
attractiveness of residential areas. Quality brownfield development is not
achieved by standard design and layouts and we will continue therefore to
retain our flexible approach and add to our reputation as 'the local,
national housebuilder'. Building on our past experience in urban
regeneration, we continue to be innovative in our approach to the procurement
of land, especially in brownfield areas. The Group's skills in this area
should allow us to continue to increase our market share. We are pleased to
say that for the past few years we have achieved the Government's 60% target
for new housing development to be on brownfield land.
Our policy for targeting inner city areas has continued and we have many high
value flatted developments in the inner city areas of London, Cardiff,
Ipswich, Birmingham, Nottingham, Sheffield, Manchester, Glasgow and
Edinburgh.
In last year's report reference was made to planning and other unforeseen
delays hampering the trading of our South East division. We are pleased to
report that these problems have been resolved and the division is now set for
profitable expansion under new management.
We continue to enhance our high quality land bank, particularly in brownfield
locations. At 31 January 2000, the Group had 17,400 plots with planning
permission. In addition we control a larger number of plots that have
realistic prospects of securing planning permission in the future. The
Government has earmarked the Thames Gateway as a major growth area for the
next decade and here we have a large holding of land zoned for housing.
EMPLOYEES
The Group's future prosperity is secured not only by our land bank but
through the outstanding efforts and teamwork of all our employees. I would
like to thank them on behalf of the Board and the shareholders.
OUTLOOK
The Government's recent budget was understandably aimed at calming the
housing market which if successful is in the best interests of the industry.
The increase in stamp duty on homes over £250,000 will affect only a small
percentage of our business. The disappearance of MIRAS has, we believe,
already been anticipated by our purchasers and we have not noticed any
reduction in demand since the budget. Interest rates increased several times
last year and many experts expect further increases. However, in spite of
these fiscal changes, we expect demand to remain strong as our products,
locations and prices remain attractive. Our homes sold are over 500 in
advance of this time last year with a forward order book of over £350
million.
As always, we continue to devote considerable resources to customer care. We
have new bespoke software systems to further improve the level of service we
provide and we are planning the introduction of integrated WAP mobile
telephones for communication purposes with our subcontractors.
Technology advances daily and we must embrace it in the way we operate. Our
web site receives many enquiries daily, not only from this country but from
abroad, with a small but increasing percentage of our homes being sold this
way. The site is being improved continuously and we have now launched new
features such as interactive views of show home interiors and the ability to
take reservation fees on-line by credit card.
Your Board remains, as ever, extremely confident about the Group's future
prospects.
H C Dawe
Chairman
11 April 2000
FOR FURTHER INFORMATION CONTACT:-
ALAN G ROBSON, GROUP FINANCE DIRECTOR, BELLWAY p.l.c. AT THE OFFICES OF
CHARTERHOUSE SECURITIES LIMITED, 1 PATERNOSTER ROW, ST PAUL'S, LONDON EC4M
7DH (telephone 0171 248 4000)
BELLWAY p.l.c.
GROUP PROFIT & LOSS ACCOUNT
Half Year to Half Year to Year Ended
31 January 31 January 31 July
2000 1999 1999
£m £m £m
Turnover 249.4 180.6 504.4
==== ==== ====
Operating profit on ordinary 32.9 23.4 73.3
activities
Share of operating profit in - - 0.4
associated undertakings
_____ _____ _____
Total operating profit 32.9 23.4 73.7
Profit on sale of fixed asset - 0.9 0.9
investment
_____ _____ _____
Profit on ordinary activities 32.9 24.3 74.6
before interest
Net interest payable 2.5 3.1 6.4
_____ _____ _____
Profit on ordinary activities 30.4 21.2 68.2
before taxation
Taxation 9.1 6.6 21.0
_____ _____ _____
Profit on ordinary activities 21.3 14.6 47.2
after taxation
Minority Interest - - 0.1
Dividends on equity and 4.9 4.5 14.2
non-equity shares
_____ _____ _____
Retained profit 16.4 10.1 33.1
==== ==== ====
Dividend per preference share 4.75p 4.75p 9.5p
Dividend per ordinary share 3.6p 3.3p 11.25p
Earnings per ordinary share - 18.8p 12.6p 42.0p
basic
Earnings per ordinary share - 18.7p 12.5p 41.8p
diluted
BELLWAY p.l.c.
GROUP BALANCE SHEET
At At At
31 January 31 January 31 July
2000 1999 1999
£m £m £m £m £m £m
Fixed assets
Tangible 14.0 12.6 13.2
assets
Investments 2.0 1.8 2.1
_____ _____ _____
16.0 14.4 15.3
Current assets
Stocks 544.1 504.4 490.1
Debtors 24.5 21.2 20.0
Cash at bank - 0.4 9.7
and in hand
_____ _____ _____
568.6 526.0 519.8
_____ _____ _____
Creditors due
within one
year:-
Bank 39.0 47.3 -
borrowings
Other 157.7 165.3 165.1
creditors
_____ _____ _____
196.7 212.6 165.1
_____ _____ _____
Net current 371.9 313.4 354.7
assets
_____ _____ _____
Total assets 387.9 327.8 370.0
less current
liabilities
Creditors due after
more than one year:-
Bank 55.0 45.0 55.0
borrowings
Other 27.5 18.0 26.1
creditors
_____ _____ _____
82.5 63.0 81.1
_____ _____ _____
NET ASSETS 305.4 264.8 288.9
===== ===== =====
Capital and
reserves
Called up 33.6 33.6 33.6
share capital
Reserves and 271.8 231.2 255.3
share premium
_____ _____ _____
SHAREHOLDERS' 305.4 264.8 288.9
FUNDS
===== ===== =====
The interim accounts were approved by the Board of Directors on 11 April
2000.
The interim accounts have been prepared on the basis of the accounting
policies to be adopted in the accounts for the year ending 31 July 2000 in
all material respects. These are the same policies as applied in the accounts
for the year ended 31 July 1999.
The taxation charge is calculated by applying the directors' best estimate of
the annual effective tax rate to the profit for the period.
The financial information for the two half year periods is unaudited and does
not constitute statutory accounts within the meaning of the Companies Act
1985. The figures relating to the year ended 31 July 1999 are an extract from
statutory accounts within the meaning of section 240 of the Companies Act
1985 which have been delivered to the Registrar of Companies and on which the
auditors gave an unqualified audit report.
BELLWAY p.l.c.
GROUP CASH FLOW STATEMENT
Half Year Half Year Year
Ended Ended Ended
31 January 31 January 31 July
2000 1999 1999
£m £m £m £m £m £m
Cash 28.7 61.8 (15.8)
outflow /
(inflow) from
operating activities
Net cash outflow / (inflow) from
returns on investments and
servicing of finance
Interest 2.8 3.2 6.3
paid
Interest (0.4) (0.1) (0.3)
received
Dividends 0.9 0.9 1.9
paid -
non-equity
______ _______ _______
3.3 4.0 7.9
Taxation 5.8 1.0 23.8
Net cash outflow / (inflow) from
capital expenditure and financial
investment
Purchase of 2.8 2.8 4.9
tangible fixed
assets
Sale of tangible
fixed assets
- exceptional - (1.3) (1.3)
item
- other (0.5) (0.6) (0.8)
______ _______ _______
2.3 0.9 2.8
Equity 8.7 7.8 11.4
dividends
paid
______ _______ _______
Net cash 48.8 75.5 30.1
outflow
before
financing
Net cash inflow from financing
Issue of
ordinary share
capital on
exercise of
share options (0.1) (0.1) (1.3)
Increase in - - (19.0)
bank loans
______ _______ _______
(0.1) (0.1) (20.3)
______ _______ _______
Decrease in 48.7 75.4 9.8
cash in
period
===== ===== =====
Latest directors dealings
- 14 hours ago Savannah Energy
- 15 hours ago Buccaneer Energy PLC
- 15 hours ago Savannah Energy
- 15 hours ago Carclo
- 15 hours ago Schroder Japan Growth Fund