Amid the closure of sales and construction sites, cash conservation is the top priority for housebuilder Bellway (BWY) as it braces for the disruption of Covid-19. The half-year dividend has been suspended and new site purchases have also been halted, with expenditure to be focused on plots that are in the later stage of the production cycle. During the first-half, the group increased investment in its landbank, purchasing plots at a rate almost a fifth higher than the prior year.
While sales completions rose 6 per cent during the first-half, that rate looks set to inevitably slow throughout the rest of the year, and the group may have to battle a further reduction in average sales prices. Private homes in the south of England sold for 8 per cent less than the same time the year before, weighing on the group’s operating margin, which declined to 19.3 per cent from 21.5 per cent.
| BELLWAY (BWY) | ||||
| ORD PRICE: | 2,011p | MARKET VALUE: | £2.48bn | |
| TOUCH: | 2,009-2,017p | 12-MONTH HIGH: | 4,336p | LOW: 1,736p |
| DIVIDEND YIELD: | 5% | PE RATIO: | 5 | |
| NET ASSET VALUE: | 2,464p | NET CASH: | £4.6m | |
| Half-year to 31 Jan | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2019 | 1.49 | 314 | 208 | 50.4 |
| 2020 | 1.54 | 292 | 194 | 0.0 |
| % change | +3 | -7 | -7 | -100 |
| Ex-div: | na | |||
| Payment: | na |
