Business is booming at Bellway (BWY), according to an interim management statement from the housebuilder covering the 18 weeks to 30 November. In that time the number of active sales outlets grew by 5 per cent to 224, while net reservations rose to 144 a week - up 43 per cent from a year ago.
Demand has been boosted by an increasing take-up of the government's Help to Buy scheme, which now accounts for nearly a third of all reservations made. And while competition for building land is growing, notably in the South East, the group managed to meet or exceed its minimum criteria on both gross margins and return on capital employed when spending £121m on land and land creditors, as well as agreeing heads of terms on a further 4,000 plots with a value of £220m.
The group continues to be highly cash-generative, holding net cash of £74m, thanks to a higher number of legal completions in the first 18 weeks of the financial year. And a £25m rolling credit facility has been renewed, thus maintaining facilities of £300m.
Accordingly, analysts at Numis Securities have upgraded their full-year forecasts by 9 per cent to pre-tax profits of £202m and EPS of 129.2p.
