Bovis Homes posts 9% rise in first-half profit, confident on outlook

17th Aug 2015 07:27

(ShareCast News) - Bovis Homes posted a 9% rise in first-half pre-tax profit as it reported a record number of legal completions and said it's on track to deliver its expected volume of new homes for 2015.Pre-tax profit for the six months ended 30 June came in at £53.8m from £49.4m in the first half of last year, on revenue of £350.7m, up 9% from £322.1m.Although pre-tax profit beat analysts' expectations of £49.8m, the shares slid.Atif Latif, director of trading at Guardian Stockbrokers, said: "The market was pleased to see a strong set of 1H numbers. The full-year outlook remains positive and given the strong run we have seen in the price some natural profit taking is taking place."Bovis shares are up a whopping 36% year to date."Looking forward, the investment case for Bovis remains intact and we remain of the view that margin growth will continue with progressive dividend yields risk skewed to the upside," he added.The interim dividend was lifted 14% to 13.7p and the company said it will increase its full-year dividend to 40p from 35p in 2014.The housebuilder reported a record number of legal completions at 1,525, up from 1,487 the previous year, while the average sales price came in at £264,200, which was 10% higher than the same period last year, driven by mix and improvements in market house prices.The company said cumulative sales to 14 August for 2015 delivery totalled 3,768 homes, with the group on track to achieve expected volume for the full year.Chief executive David Ritchie said: "We have delivered a strong first half performance in 2015 with a record number of legal completions and a further improvement in return on capital employed. Our long term land investment in high quality locations, including delivery from strategic land, is providing a consented land bank which supports growth in active sales outlets leading to increased volumes. "I am pleased to report that significant land opportunities continue to be available at higher returns meaning disciplined investment in consented land should underpin future growth in shareholder returns."At 1038 BST, Bovis shares were down 4.4% at 1,148p.