Bovis Homes Group PLC AGM Trading Statement (8453D)
02 Maggio 2017 - 8:02AM
UK Regulatory
TIDMBVS
RNS Number : 8453D
Bovis Homes Group PLC
02 May 2017
2 May 2017
BOVIS HOMES GROUP PLC
Trading statement for the period covering 1 January 2017 to
date
Bovis Homes Group PLC is holding its Annual General Meeting
("AGM") at 2:00pm today in Tunbridge Wells. This statement comments
on the Group's current trading and outlook for the financial
year.
Greg Fitzgerald, Chief Executive commented:
"I am confident that Bovis will return to being a leading UK
housebuilder and excited by the challenge ahead. The clear focus
for 2017 is on improving our production processes and efficiency
thereby ensuring we deliver quality homes to our customers. By the
end of June I will have visited all our developments and met the
majority of our people; we have already identified improvements to
streamline the business, provide greater focus and be more
agile."
Current trading
Our current trading in the year to date has been in line with
our expectations. We have opened 8 new sites in the period and are
currently operating from 95 active outlets. We expect our average
number of active sites to remain stable for 2017.
As announced in February we have slowed our rate of production
for 2017 and for the full year expect to deliver completion volumes
c. 10% to 15% below the 2016 level before returning to normal
industry production levels. Our build programme for the year to
date is expected to deliver c. 1,500 completions in the first 6
months of 2017.
Customer interest in our homes remains strong with prospects per
active outlet consistently ahead of the prior year level for the
past 8 weeks. The Group's sales rate of 0.48 net private
reservations per site per week for the year to date is in-line with
our 2017 production plans and reflects a controlled sales release
across a number of our developments and our priority focus on
customer service.
As highlighted in February, the Group's first half profitability
will be impacted by increased build costs within our cost base
brought into the year and an increased level of investment across
the business to address issues faced in 2016.
The Group will incur one-off advisory fees of c. GBP2.8m related
to the merger proposals received from Redrow and Galliford Try and
the Group's strategic review announced in February.
Land
We continue to see good opportunities in the land market that
exceed our minimum required returns. We aim to replenish our
landbank in 2017 and thereafter maintain an underlying 4 year
consented landbank. Our strategic landbank remains a valuable
supply of high quality land and we have seen significant early
success in 2017 with the conversion of strategic sites at Bishop's
Stortford, Didcot and West Witney totalling 834 plots. As a result
we are in a strong position for our 2018 delivery with the vast
majority of the land we require already owned with planning
consent.
Leasehold rents
We note the recent commentary around leasehold rents. As a
business it is our standard practice to sell our new houses on a
freehold basis. In the rare circumstances in the past where we have
not sold houses freehold, this has been due to local factors, such
as acquiring sites with existing leasehold arrangements in place.
With any of our homes sold on a leasehold basis including our
apartments, the ground rent is set at market rates and rent
increases are referenced to RPI and at no greater than 5 yearly
intervals.
Dividends
Subject to shareholder approval at today's AGM and given the
Board's confidence in the future prospects of the business a final
dividend of 30.0 pence per share (2015: 26.3 pence per share) will
be paid on 19 May 2017, giving a total dividend for 2016 of 45.0
pence per share (2015: 40 pence per share).
Our strategic review will determine the Group's dividend policy
going forward and for 2017 the Board remains committed to at least
maintaining the total proposed dividend at the declared level for
2016.
Outlook
The demand for new homes remains robust across all regions and
overall we have seen some modest house price inflation in the
period. We have made clear progress in addressing the issues faced
during 2016 and in particular have re-established a 'customer
first' culture across the business. The group is confident it will
deliver on its expectations for 2017.
We are clear in our goal of delivering shareholder value through
maximising returns from the Group's valuable landbank and returning
Bovis to being an industry leading housebuilder. Greg Fitzgerald
will conclude a strategic and structural review of the Group over
the coming months and will provide an update with the half year
results announcement which has been re-scheduled for 7 September
2017.
Certain statements in this press release are forward looking
statements. Forward looking statements involve evaluating a number
of risks, uncertainties or assumptions that could cause actual
results to differ materially from those expressed or implied by
those statements. Forward looking statements regarding past trends,
results or activities should not be taken as a representative on
that such trends, results or activities will continue in the
future. Undue reliance should not be placed on forward looking
statements.
For further information please contact:
Bovis Homes Group PLC 01474 876219
Earl Sibley, Group Finance
Director 07811 988617
Susie Bell, Interim Head
of IR
Maitland
Neil Bennett
James McFarlane 020 7379 5151
This information is provided by RNS
The company news service from the London Stock Exchange
END
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