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Countryside Properties reports record results but shares wobble as CEO announces retirement

Ian Sutcliffe, who has served as head of the FTSE 250 housebuilder since 2015, will step down on 1 January, although he will remain with the company until the end of March

Countryside Properties - Countryside Properties reports record results but shares wobble as CEO announces retirement
The rise in incomes was boosted by a 33% increase in completions during the year to 5,733 homes

Countryside Properties PLC (LON:CSP) has reported record results for its latest full-year, however, the shares wobbled on Thursday after the firm’s chief executive announced his retirement.

Ian Sutcliffe, who has served as CEO of the FTSE 250 housebuilder since 2015, will step down from the position on 1 January 2020, although he will remain with the company until the end of March.

READ: Deutsche Bank upbeat on housebuilders, thinks Help to Buy could be extended beyond 2023

He will be succeeded by Iain McPherson, Countryside’s head of group partnerships south, who joined the company in 2014.

Profits rise 11%

The announcement came alongside the group’s figures for the year ended 30 September, which saw an adjusted operating profit of £234.4mln, 11% higher than the prior year, while revenues climbed 16% to £1.4bn.

The rise in incomes was boosted by a 33% increase in completions during the year to 5,733 homes, which was attributed to “strong organic growth” supplemented by the integration of homebuilder Westleigh, which Countryside acquired in April last year.

The group also unveiled a final dividend of 10.3p per share, which when combined with its interim payout resulted in a total dividend for the year of 16.3p, 51% higher than 2018.

Looking forward, the firm said it has started its current year with a “record order book and robust current trading” across its divisions, with net reservation rates for the first seven weeks ahead of the same period last year.

The group added that barring “potential economic and political uncertainty”, it was confident of delivering further earnings growth in 2020.

"We have continued our excellent growth trajectory during the past year and have exceeded our expectations in operating margins, return on capital employed and cash generation”, Sutcliffe said of the results.

“With strong demand from first-time buyers and ongoing political support, the Board looks forward to delivering continued growth from both of our operating divisions", he added.

However, investors seemed unsure in the face of the CEO's impending departure, with the shares down 1% at 372p in early deals.

Analysts at Peel Hunt were more upbeat, raising their target price for the firm to 410p from 375p and retaining their ‘buy’ rating on the back of the full-year numbers.

Quick facts: Countryside Properties

Price: 345.2 GBX

LSE:CSP
Market: LSE
Market Cap: £1.81 billion
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