Bellway posts drop in FY profit, sees lower completions

17th Oct 2023 07:59

(Sharecast News) - Housebuilder Bellway reported an 18.1% fall in full-year underlying pre-tax profit on Tuesday amid a "challenging" market, with demand dented by rising mortgage rates, and warned it will build fewer homes in 2024.

In its preliminary results for the year to the end of July, the company said underlying pre-tax profit declined to £532.6m from £650.4m a year earlier.

Housing completions dipped 2.3% to 10,945 and revenue was 3.7% lower at £3.4bn.

Bellway also said that based on the average private reservation rate per site per week of 0.46 achieved in 2023, it is now targeting far few completions for 2024, at around 7,500 homes.

The company said that since the start of the new financial year, demand continues to be hit by mortgage affordability constraints, with reservations below the comparative rates in the prior year. In the nine weeks since 1 August, overall weekly reservations were 133 per week, down from 191, while the private reservation rate was 99 per week, down from 136.