Bellway buys up land as building reforms begin
ON THE day the Government announced an overhaul of Britain’s broken housing industry and promised more affordable properties, it was no surprise to see the housebuilders boosted.
Persimmon gained 1pc, or 19p, to 1957p, while Barratt advanced 0.6pc, or 2.8p, to 496.3p.
Bellway’s results for the six months to January 31 proved timely. The firm reported 4,462 completions in the period, up 6.5pc from a year ago, and said the outlook was positive with strong customer demand.
It had also invested £380m in land – up considerably on last year.
Bellway said competitive mortgage rates and the Government’s Help To Buy scheme were keeping new homes affordable – around 166 homes are being reserved every week. The average completion price was down slightly at £256,000 due to a greater proportion of lower value social homes, but it expects the average sale price to rise to £260,000 by the end of its current financial year in July. Shares leapt 2pc, or 51p, to 2567p. And as the builders boomed, the
FTSE 100 was up 0.2pc, or 14 points, to 7186.2. Meanwhile, real estate investor St Modwen Proper
ties is reported to be in exclusive negotiations with French firm Vinci SA to sell a site near the redevelopment of Battersea Power Station in London. The ten-acre Nine Elms site in New Covent Garden Market, which was valued at £621m a year ago, has planning permission for more than 1,800 homes.
On other developments, St Modwen said the latest phase of its overhaul of Longbridge town centre in Birmingham was complete and it was starting work on a housing phase, while at Swansea University it was advancing with plans to increase the number of student rooms at the Bay Campus to 2,000.
Profit for the year was £66.9m, down from £235.2m a year ago. Chief executive Mark Allan, who was appointed last year, said he would review the portfolio and business strategy. The firm said it had been an unsettled period for the market and it was important to be prudent. Shares climbed 1.6pc, or 5.1p, to 327p. Elsewhere in the sector, Capital &
Regional secured tenants for two former BHS units at shopping centres in Walthamstow and Redditch.
The real estate investor has let the spaces, which total 64,000 sq ft, to Lidl and The Range. The Range has taken a ten-year lease at The Kingfisher Centre in Redditch, and the store is expected to open by Easter. Capital & Regional slipped 0.4pc, or 0.25p, to 56.5p.
Mail and logistics firm DX Group plunged as it warned investors that there would be no dividend for the foreseeable future.
In a profit warning, the business said pricing pressure continued and its margins were being eroded. While the logistics arm had been stronger, its courier and freight business were hit by the combination of lower margins and a fixed cost base. DX had integrated five sites into one as part of its OneDX programme but short-term operational issues in doing so had pushed costs up temporarily. DX warned that profit for the year will be significantly below forecasts while net debt will be higher. The firm has started a review to try to drive up revenues and improve financial performance. Shares plummeted 61.4pc, or 11p, to 6.95p.
Marlowe announced its second acquisition in four days. The firm, which buys and develops fire protection, security systems and water treatment businesses, has bought Alpha Peerless Fire Systems for £475,000. Alpha provides fire protection services in Greater London, including installation and maintenance of fire detection systems.
In the year to March 31, 2016, it reported revenue of £2.6m and pretax profit of £ 30,000. Marlowe shares fell 1.9pc, or 7.5p, to 390p.
Fox Marble flew as it secured its first customer in India. The AIMlisted marble company, which is based in Kosovo, secured a threeyear deal worth £1.45m a year with green marble exporter Mahadev Marmo. Shares rocketed 20.3pc, or 1.6p, to 9.6p.