- Housebuilder posts 28% rise in underlying profit before tax to £289 million
- Plans £150 million share buyback and a 30% dividend increase
- Forecasts growth to 9,200 homes next year despite softening demand
Bellway PLC (LSE:BWY) shares rose 5% in early trading after the UK housebuilder reported a strong rise in annual profit and unveiled plans for a £150 million share buyback.
The Newcastle-based group said underlying pre-tax profit climbed nearly 28% to £289 million for the year to July, while completions jumped 14% to 8,749 homes.
Revenue grew to £2.78 billion from £2.38 billion, helped by steady pricing and improved build efficiency.
The company lifted its total dividend by almost 30% to 70p a share, citing healthy cash flow and a net cash position of £41.8 million compared with net debt a year earlier.
Underlying operating margin improved to 10.9%, and return on capital employed rose to 8.7%.
Chief executive Jason Honeyman said Bellway’s focus on efficiency and capital discipline was supporting stronger returns.
“We have a high-quality land bank, a robust balance sheet and the capacity to capitalise on positive long-term housing fundamentals,” he said.
Bellway said near-term demand had softened due to affordability pressures and uncertainty ahead of the November Budget, but it still expects to increase completions to about 9,200 homes in the current year.
The group’s land bank of nearly 96,000 plots gives visibility on growth to 10,000 homes by 2028.
The builder also urged the government to accelerate planning reform and support first-time buyers to boost supply in a market still constrained by affordability and regulation.
Both Peel Hunt and Panmure Liberum said there were zero surprises in the results, which were largely foreshadowed in the builder's trading statement.
Bellway's shares rose 116p to 2,594p.