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The Markets
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Real Estate

Berkeley backs vote to stay in EU as jitters hit demand

Housebuilder said uncertainty over the referendum was hitting business

Housebuilder Berkeley Group Holdings PLC (LON:BKG) posted higher annual profits and said it was backing a vote to stay in the EU in next week’s UK referendum.

Berkeley said adjusted pre-tax profit in the year to April 30 rose 5.6% to £479.9mln on a 3.4% fall in revenue to £2.05bn.

The group said underlying demand was robust but uncertainty over the referendum was hitting deal levels.

Reservations in the five months to May dropped a fifth on reduced new launches in the run-up to the vote on June 23.

Chairman Tony Pidgeley said: “The outcome of next week's referendum on Britain's membership of the EU is significant for the UK's housebuilding and property sector.

“Berkeley supports a vote to remain in the EU. London's status as the world's best big city is underpinned by labour mobility, cultural diversity and a constant influx of talent and investment from around the world.

“The UK economy in turn is powered by the success of our capital city.”

Berkeley increased forward sales to £3.25bn from £2.95bn a year ago and its land bank rose to £6.1bn of estimated future gross margin versus £5.3bn a year ago.

Net asset value per share increased 9.6% to 1314p following the payment of a £259.5mln, or 190p per share, dividend.

But pre-tax profits fell 1.6% to £531mln due to reduced ground rent sales after the company sold its ground rent portfolio for a profit of £51mln.

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