Bellway shares fall amid Covid disruption

bellway

Bellway has released its preliminary results for the year ended 31 July 2020.

The housebuilder saw sales and profits down amid Covid-19 disruption, however, trading has picked up since restrictions eased.

The number of housing completions fell by 30.9% from 10,892 to 7,522.

The group posted a fall in pre-exceptional operating profit fell to £321.7m from £674.9m a year previously. Bellway said that there was an exceptional Covid related expense of £25.8m spent on site-based costs as well as a £9.9m cost from aborted land deals.

After exceptional costs, pre-tax profits plunged 64.3% to £236.7m.

Trading in the first nine weeks of the new financial year has been strong thanks to a boom in the housing market. The average week reservations increased by 30.6% and the forward order book increased from £1.3bn to £1.9bn.

“Pent-up demand arising from the prolonged period of lockdown inactivity, together with Government support through the stamp duty holiday and provision of Help to Buy, have contributed to this reassuringly strong performance,” said Jason Honeyman, the chief executive.

“As the country emerges from the initial extended national ‘lockdown’ and adapts to ongoing restrictions at both a national and local level, there is substantial economic damage and an ongoing threat of a more widespread resurgence in the virus.”

“In addition, we are yet to see the extent to which unemployment will rise as the unprecedented support offered by the Government’s CJRS ends and is replaced with the Job Support Scheme,” he added.

Bellway shares fell 3.88% on Tuesday.