Housebuilder Crest Nicholson has boosted sales targets on the back of “robust” demand for new homes, raising the stakes for a newly configured board that includes a new chief executive.
The company said pre-tax profit rose 6% to £207 million for the year to October 31, as sales including joint ventures jumped 7% to just shy of £1.07 billion, compared with £1 billion a year earlier.
Statutory revenue grew 5% to £1.04 billion over the period, as it delivered 2,935 new homes – an uptick of 2.3% – with an average selling price of £388,000.
Crest Nicholson said it was continuing to “strengthen” and future-proof the business with an increase in outlets, including a new division in the Midlands.
It has also reduced its exposure to Central London where sales have slowed, and instead focused on land in “more affordable outer zones”, adding that the Government’s Help to Buy scheme is still an “important driver” of new home sales.
Crest Nicholson today announces its full year results. Please find the full statement here: https://t.co/5x2MRtZDTz— Crest Nicholson (@CrestNicholson) January 24, 2018
Despite the “challenges of affordability” and the impact of stamp duty changes that it suspects suppressed the sale of more expensive homes, Crest Nicholson said the “outlook for the UK housing market is strong”.
The housebuilder is now targeting £1.4 billion in sales by next year.
Chief executive Stephen Stone said: “We have had another year of growth, with increases in sales and the number of new homes built.
“Our new business divisions are continuing to grow, driving increases in sales outlets and underpinning our ambitious sales target of £1.4 billion in 2019.
“The new-build housing market continues to be robust, sustained by strong demand for new homes, a benign land market and Government policies to improve access to housing.
“Against this backdrop, Crest Nicholson is confident in its ability to continue delivering great homes for customers and strong returns for shareholders.”
Mr Stone is one of a raft of board members being appointed to new roles this spring, according to an announcement issued alongside the annual results.
Crest Nicholson said on Wednesday that it was promoting its chief operating officer Patrick Bergin to chief executive officer.
He will take over this spring from Mr Stone, who will step in as an executive chairman from March 22 until April next year when he will become the company’s non-executive chairman.
Current chairman William Rucker – who has served in the role since September 2011 – will not seek re-election at the annual general meeting in March.
The company said the decisions followed “an extensive consultation with major shareholders”.
The company has also appointed former United Biscuits and Rexam chief executive Leslie Van de Walle as deputy chairman and senior independent director, while Louise Hardy will join the board as a non-executive director having been part of the technical committee since mid-2017.
Interim chairwoman of the nomination committee Octavia Morley said: “Under the leadership of Stephen and Patrick, Crest Nicholson has been a very strong performer since its initial public offering in February 2013, achieving significant increases in total shareholder return, profitability and number of homes built.
“The board believes their combined leadership as CEO and chairman will continue to be a winning formula for shareholders in the future.”
Crest Nicholson shares were lower in morning trading, down 2% to around 513p.