Bricklayers, chippies, your country needs you! A shortage in skilled labour is one reason cited by management at Bovis Homes (BVS) for its costs spiking by 10 per cent to £117,300 per unit in the first half even as materials costs remained relatively flat. Still, the group upped the number of completed homes it sold from 1,487 to a record 1,525.
Where Bovis has lagged behind its competitors is the level of return on capital employed. This was up from 13.4 per cent at the halfway stage last year to 15.6 per cent, but compared with the 16.2 per cent achieved across 2014 it was underwhelming. Yet chief executive David Ritchie remains confident Bovis can hit 20 per cent on this metric by 2016, and that growing its land bank as it did here - it added 2,687 consented plots in the first half - means more value will be unlocked for shareholders in future.
Average sales prices were 6 per cent ahead, at £222,300. This was slower growth than in the comparative period last year due to a greater number of social housing completions, which sell for less. Private completions were selling at 10 per cent higher prices.
Analysts at Peel Hunt expect full-year adjusted pre-tax profits of £168m, giving EPS of 99p, up from £134m and 78p in 2014.
| BOVIS HOMES (BVS) | ||||
|---|---|---|---|---|
| ORD PRICE: | 1,148p | MARKET VALUE: | £1.5bn | |
| TOUCH: | 1,147-1,150p | 12-MONTH HIGH: | 1,206p | LOW: 723p |
| DIVIDEND YIELD: | 3.2% | PE RATIO: | 14 | |
| NET ASSET VALUE: | 666p | NET DEBT: | 7% | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2014 | 322 | 49.4 | 28.8 | 12.0 |
| 2015 | 351 | 53.8 | 32.1 | 13.7 |
| % change | +9 | +9 | +11 | +14 |
Ex-div: 24 Sep Payment: 20 Nov | ||||
