Housebuilder Abbey shares fall 5% despite rise in revenue

Housebuilder Abbey shares fall 5% despite rise in revenue

Shares in the Housebuilder Abbey fell this morning after the group warned of rising costs and “uncertain external conditions”.

The group issued a trading update on Friday, revealing a rise in pre-tax profit from €23.42 million last year to €23.93 million.

Abbey’s year-on-year revenue rose 22% in its first half-year results from €90.4 million to €110.7 million.

Charles Gallagher, the group’s chairman, said: “Whilst our UK forward sales position gives confidence that a reasonable result for the year will be achieved the continuing uncertain external conditions are cause for concern.”

“The group will continue to progress all its activities but intends to be cautious about new investments in the months ahead,” he added.

In a statement, the group said: “Trading in the UK has held up well over the six months. Margins, as previously guided, have reduced in line with our expectations. Forward sales continue to be encouraging. In particular our projects aimed directly at first-time buyers are selling well. Production continues to be impacted by tight labour and materials markets and some delays have been experienced.”

Shares in Abbey (LON: ABBY) are trading 5.43% lower (1112GMT). 

In other property news, housebuilder Berkeley Group (LON: BKG) announced on Friday that it will raise its profit guidance for the year by over 5%.

This is despite pre-tax profit for the first of the year falling from £539.9 million a year ago to £401.2 million.