The Press and Journal (Aberdeen and Aberdeenshire)
Profits soar as Springfield builds on flotation success
But CEO Smith warns firms may miss affordable homes targets
The pace of housebuildingacross Scotland needs to ramp up if national targets for affordable homes are to be met, a leading firm in the sector said yesterday.
Elgin-based Springfield Properties said it built 310 lower cost homes during the year to May 31, up from 183 in the previous 12 months, and was looking to do more.
The firm is also open to expansion into the Aberdeen housebuilding market once it “settles down” after the recent economic downturn, bosses said.
Chief executive Innes Smith said there was a gap between the Scottish industry’s current rate of building affordable flats and houses – about 17,000 annually – and the 24,000 units a year that are required to meet Holyrood’s target of 50,000 new homes before 2021.
He was speaking after Springfield posted its first full-year results since its AIM flotation raised £25 million last October.
Adjusted pre-tax profits rocketed by 46% during the year to May 31, to £9.8m, while revenue soared by 27% to £140.7m as the firm benefited from unmet market demand and low mortgage rates.
The company built a total of 770 homes during the latest period, up from 620 the year before.
Its private homes division completed 460 units, up from 437 previously, at an average selling price of £221,500.
The average price of the firm’s affordable homes fell by nearly £7,000 to £120,200, which Springfield said was due to a “difference in sales mix”.
Revenue from this market segment increased by 60.3% to £37.3m and with the company having secured land for 12 new affordable-only housing developments and planning consent for 981 “affordable” plots, taking its land bank for these type of homes to 3,719 plots on 43 sites, numbers are forecast to grow.
Springfield, whose total land bank was worth £2.4 billion at the year end, expects to build 360 affordable homes and 900 in total during 2018-19. Activity levels and a recent acquisition have seen the workforce grow to 620.