27 July 2016 – interim results
The group has announced solid results for the six months to 3 July, with revenue up by 9.1% over the previous year at £1.46bn, whilst pre-tax profit before exceptional items was 12% higher at £266.6m. Earnings per share on the same basis were 10.2% higher at 6.5p and the interim dividend was increased by 8.1% to 0.53p. The group ended the period with net cash of £116.7m. These are obviously very pleasing results and the group completed 6,019 homes in the first half, a 3% increase on last year, with the average selling price up by almost 6% at £238,000. As at 24 July, the group had an order book of £2,2bn representing almost 8,700 homes. The group has stated that so far it has not seen any adverse effects from Brexit although it is still clearly early days. Importantly, the group has also stated that it intends to pay a special dividend of 9.2p in July 2017 as it did in July 2016 – this should lead to a total payout in 2017 of 13.8p providing a dividend yield of 9.2%. We maintain our recommendation of BUY.