Group sees contracted, reserved or completed sales up 43% on 2011

Housebuilding and construction group Galliford Try has issued an interim management statement reporting reserved, contracted or completed sales of 拢774m, up from 拢540m in 2011 - a rise of 43%.

It said sales had been strong through its Linden Homes brand since the start of 2012, with 0.6 sales-per-site-per-week, compared with 0.45 for the first half of the company鈥檚 financial year, which runs from July 1.

The statement said there was 鈥渟ome evidence of improving mortgage availability鈥� and that recent government initiatives to further help the market were encouraging.

Galliford said its construction order book remained stable at 拢1.6bn - the same figure as for 2011, with 鈥渟ignificant project wins鈥�, including the 拢347 million Gateshead Regeneration programme; 拢117 million of projects for Anglian Water, Scottish Water and Yorkshire Water; 拢56 million of Partnerships development contracts; and 拢49 million in the commercial building sector.

Chief executive Greg Fitzgerald said that the business鈥� southern-focused housebuilding division continued to perform strongly and that a its important contract wins had been achieved the face of a 鈥渄ifficult鈥� construction market.

鈥淭he group is confident of delivering its housebuilding expansion plan as set out three years ago and we remain on track to meet our expectations for the financial year,鈥� he said.

鈥淭he strong financial performance in the period means the group is expected to be cash positive at financial year end. Our disciplined growth plans and focus on margin improvement should continue to create shareholder value and support our progressive dividend policy.鈥�

Alastair Stewart, building and construction analyst at Canaccord Genuity, said the investment bank believed Galliford had been able to 鈥渄ifferentiate鈥� itself from mainstream peers and raised its share target price for the firm.

鈥淭he hybrid developer-contractor is our favourite pick against a backdrop of our underweight stance on the housebuilders,鈥� he said.

Stewart added that Galliford鈥檚 鈥渃ash-positive鈥� prediction for its year-end figures were an improvement on estimates of a 拢50m net debt.

 

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