News Column

MJ Gleeson Says Profit To Beat Hopes On Land Sales, Strong Trading

July 3, 2014

Steve McGrath

LONDON (Alliance News) - MJ Gleeson Group PLC Thursday said it expects to report profits for the financial year just ended that are significantly above expectations, after accounting for land sales towards the end of the year and a strong performance by its house building business.

The urban regeneration company has said back in April that it expects it profit for the year to end-June to be in line with or possibly better than market expectations.

However, since then it said it took advantage of strong demand from major housebuilders for green field residential land in the south of England to sell two land interests just before the end of the financial year. That meant it sold seven interests during the year as a whole, more than it expected.

It said it now has four sites with planning permission and two more sites with resolutions to grant planning permission subject to legal agreements. A further 16 sites are the subject of either submitted planning applications or lodged planning appeals. It strategic portfolio consists of 64 sites totalling 3,800 gross acres, which have the potential to deliver 21,000 plots.

On top of the land sales, its Gleeson Homes business sold 561 homes during the year, up 38% from 406 a year earlier.

"The proportion of units sold on recently acquired, higher margin sites continued to improve with 84% of the units sold from the higher margin sites compared to last year's 75%. The increase in sales from these sites, along with the increase in the volume of sales, substantially improved the profitability of the business unit for the year," the company said in a statement.

It said Gleeson Homes remained an active land buyer during the year. Its landbank of owned and conditionally purchased plots at June 30 was 31% more than a year earlier, totalling 5,065 plots of which 1,815 plots have been bought subject to planning permission. There are a further 1,600 plots which are in the pipeline to be acquired, it said.

The unit's forward order book on July 1 totalled GBP44.2 million representing 356 homes, up 70% on last year's total of GBP26.0 million.

MJ Gleeson shares were up 5.6% at 401.15 pence Thursday morning.

For more stories on investments and markets, please see HispanicBusiness' Finance Channel

Source: Alliance News

Story Tools Facebook Linkedin Twitter RSS Feed Email Alerts & Newsletters