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Countryside Properties to meet full-year expectations as second half recovers

Countryside Properties announced Rebecca Worthington would step down as chief operating officer with immediate effect after almost four years at the company.
The private average selling price fell by 4% to £377,000 in the first half

UK housebuilder Countryside Properties PLC (LON:CSP) said it was on course to meet full-year expectations as customer demand improved in the second quarter after a slow start to the year.

In a trading update, the group said total home completions jumped 43% to 2,362 in the first half ended March 31.

READ: Countryside Properties' reservation rate slowed in December

However, the private average selling price fell by 4% to £377,000 due to a higher percentage of regional properties sold.

The net reservation rate met the top end of the group’s target range at 0.86, compared to 0.87 last year.

Countryside ended the period with a total forward order book of £1.04bn, up 49% on the year-ago period.

In March, the group’s modular timber frame factory in Warrington started full production and is set to deliver about 500 homes in the current financial year. It has a production capacity of up to 1,500 homes per year.

On track to meet full-year guidance

The company said completions will be second half weighted but it is on track to meet its full-year guidance on the back of a strong forward order book and further outlet openings.

"Despite the wider political and macroeconomic uncertainty, demand for mixed-tenure homes remains strong and we have enjoyed a robust spring selling season,” said chief executive Ian Sutcliffe.

“With our modular timber frame factory now operational, we continue to be well positioned to deliver on our geographic expansion.

“With excellent visibility of future work, we remain confident of delivering our medium-term growth plans."

Separately, Countryside announced Rebecca Worthington would step down as chief operating officer with immediate effect after almost four years at the company.

Shares gained 5% to 336p in morning trading. 

Peel Hunt sees shares recovering in coming months

"The shares have lagged the sector badly in 2019 with only a 5% rally vs a 25% bounce for the sector due to forecast concerns following the 'softish' Q1," Peel Hunt said, reiterating 'buy' rating. 

"With those concerns now removed we see the shares delivering some catch up over the next 3-6 months. We continue to see the mix of the group with its big exposure to partnership housing as an attractive medium term mix which is capable of delivering strong returns as well as growth.

"Consequently, with an unchanged target price of 375p, we see more short-term upside in Countryside than other housebuilders for now."

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