For the six months to 30 June, the FTSE 250-listed firm saw its pre-tax profit jump by 41% to £60.2mln, up from £42.7mln a year earlier, reflecting a 280 basis point increase in gross margin while group revenue rose by 1% to £432.2mln.
The housebuilder saw its total completions increase by 4% to 1,580 homes, up from 1,512 a year earlier, with the private average selling price holding steady at £334,700.
The firm further strengthened its balance sheet with a move to an average net cash position in the period of £6mln, a turnaround from an average net debt of £96m a year earlier.
Its net cash position as at June 30 was £42.8mln, against net debt of £32.4mln a year earlier.
Greg Fitzgerald, Bovis’ chief executive commented: “This reflects the excellent progress made across all business areas over the past 18 months and a step change in the quality of the homes we are building and level of service we are providing our customers.
“We are confident in the outlook for the business and are targeting a record year of profits in 2018, at the top end of the Board's expectations."
Bovis raised its interim dividend by 27% to 19p per share, up from 15p last year, and will pay a first special dividend of 45p pence per share with the interim in November.
Focus on margins
Nicholas Hyett, equity analyst at Hargreaves Lansdown commented: “A focus on margins has seen profits leap this year, and he (Fitzgerald) intends to deliver a similar margin boost before the end of 2020.
“That’s particularly impressive given the problems with build cost inflation that have plagued Bovis in the past. Streamlining the group’s land bank should also boost returns on capital.”
In late morning trading, Bovis Homes shares were 3.6% higher at 1,172p.
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