Bellway Delivers Strong First Half Performance
Why we think this is good
Bellway has reported a strong first half performance, with growth in housing completions, average selling price, and operating margin. The company remains on track to meet its full-year volume and pricing targets, indicating a positive outlook. While the company has moved from a net cash to a modest net debt position, this appears to be in line with expectations and not due to any extraordinary uses of cash. Overall, the trading update suggests the company is performing well in challenging market conditions.
Key Points
- 11.9% growth in total housing completions to 4,577 homes
- Average selling price of £310,600, up from £309,278 in the prior year
- Housing revenue increased by 12% to over £1.42 billion
- Private reservation rate per outlet per week increased by 18.6% to 0.51
- Forward order book of 4,726 homes valued at £1,311.5 million
- On track to deliver full year volume output of at least 8,500 homes
- Modest net debt of £8.0 million, down from net cash of £76.6 million
Summary
Bellway has delivered a strong first half performance, with growth in total housing completions, average selling price, and operating margin. The company is on track to deliver full year volume output of at least 8,500 homes and expects the full year average selling price to be around £310,000 and the underlying operating margin to approach 11.0%. The forward order book at 31 January 2025 comprised 4,726 homes, with a value of £1,311.5 million. Bellway has a strong and well-capitalised balance sheet, with modest net debt of £8.0 million.