18/01/13

Kent-based Bovis Homes Group builds profits and sales

by business editor Trevor Sturgess

A Kent-based housebuilder achieved higher sales and profits in a difficult market last year.

Bovis Homes Group, which has its head office in New Ash Green, said in a trading update that growth had been driven by a 15% rise in legal completions to 2,355 (2011: 2,045), of which 1,854 were private and 501 social.

Operating profit margin increased to 13.5% (2011: 10%), while the average price of a Bovis home edged up 5% to £170,700 (2011: £162,400).

During the year, Bovis bought 3,500 plots of land with planning consent on 24 sites, and sold three sites for a combined price of £18m.

It entered 2013 with forward sales of 778 homes, up 37% on the same time a year ago.  Bovis said this reflected stronger private reservations and an improved level of social housing reservations.

It started 2013 with 90 sales outlets, up 13% on the 80 at the start of 2012, and plans to add more.

Bovis said if the market remains stable, the increase would continue to drive growth in 2013.

Bovis ended the year with net cash of £19million after starting it with £51million, the fall largely attributed to its land investment.

Chief executive David Ritchie said: "2012 was a successful year for Bovis Homes. We delivered significant growth in profits and returns as a result of our continued strategy for growth through investment in high quality consented and strategic land.

"This strategy will be further progressed in 2013, which, subject to stable market conditions, should deliver strong improvements in the Group’s returns in 2013 and beyond."

The full results for the year ending December 31 will be published on February 25.