Berkeley Group Holdings (The) PLC Trading Statement (7719L)
September 08 2023 - 2:00AM
UK Regulatory
TIDMBKG
RNS Number : 7719L
Berkeley Group Holdings (The) PLC
08 September 2023
The Berkeley Group Holdings plc
Trading Update
Period from 1 May 2023 to 31 August 2023
8 September 2023
The Berkeley Group Holdings plc ("Berkeley" or the "Company") is
holding its Annual General Meeting ('AGM') today, at which it will
provide the following Trading Update covering the period from 1 May
2023 to 31 August 2023.
"With this trading update, Berkeley re-affirms its earnings
guidance to deliver pre-tax profits of at least GBP1.05 billion
across the current and next financial years; likely to be weighted
slightly to FY24. Supported by a strong opening forward sales
position, we have over 90% of FY24 revenue exchanged and anticipate
cash due on forward sales to be around GBP2 billion at 31 October
2023 (30 April 2023: GBP2.14 billion). We remain on track to be
working capital neutral over the course of this and the next
financial year.
Profits for the current year are expected to be split broadly
evenly between the first and second half. Net cash at 31 October
2023 will be around GBP325 million (30 April 2023: GBP410 million),
reflecting the relative phasing of joint venture and Group delivery
over the course of the year, with the former concentrated in the
first half. The actual net cash position is, as always, subject to
a number of variables including the pace of share buy-backs in the
intervening period.
In terms of the sales market, enquiries have stayed at similar
levels over the last four months, but the value of underlying
private sales reservations is some 35% below last year's rate,
reflecting the elevated macro-economic and political volatility.
Pricing remains resilient and above our business plan levels, due
to the constrained supply of both new-build and second-hand homes
to the market, while cancellation rates are stable.
October will see the transfer of responsibility for building
control sign-off to the new Building Safety Regulator, with whom we
are working closely to minimise any potential disruption from this
transition. Build cost inflation is at negligible levels when
measured across our portfolio and we are working with our supply
chain to ensure delivery programmes are met.
The complexity and protracted nature of the current planning
system and lack of clarity surrounding certain regulatory changes
affecting our sector, at a time of considerable uncertainty for the
UK economy with persistent high inflation and interest rates,
continues to deter investment into brownfield regeneration and the
wider housebuilding sector. Consequently, Berkeley has not acquired
any land in the period and will only invest very selectively in new
opportunities. We remain focused on securing and delivering the
value inherent in the Group's existing land holdings and pipeline
in a disciplined manner that will support a sustained pre-tax
return on equity of 15% through the cycle.
As announced on 10 August 2023, a dividend of GBP63.1 million
(59.30 pence per share), will be paid to shareholders on 8
September 2023 with the remainder of the GBP141.3 million return
for the six months ending 30 September 2023 having already been
satisfied through share buy-backs. Berkeley is on track to deliver
the next annual shareholder return of GBP282.7 million (currently
GBP2.66 per share) by 30 September 2024 through a combination of
dividends and share buy-backs, with at least GBP0.66 per share of
the annual return made via dividends."
END
For further information please contact:
The Berkeley Group Holdings plc Novella Communications
R J Stearn Tim Robertson
T: 01932 868 555 T: 020 3151 7008
LEI: 2138009OQSSLVVHQAL78
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END
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