Bovis sees profits soar as demand and attractive mortgage rates buoy sales
Bovis Homes has joined a string of housebuilders to overcome uncertainty in the property market after a jump in half-year profits.
The company posted a 41% rise in pre-tax profit to £60.2m in the six months to June 30, while revenue rose by 1% to £432.2m. It now expected full year profit to come in at the top end of expectation.
Strong customer demand, attractive mortgage rates and government initiatives such as Help to Buy are driving sales, Bovis said.
Chief executive Greg Fitzgerald said: “We delivered a strong performance in the half, with a more than 40% increase in profits.
“This reflects the excellent progress made across all business areas over the past 18 months and a step change in the quality of the homes we are building and level of service we are providing our customers.
“We are confident in the outlook for the business and are targeting a record year of profits in 2018, at the top end of the board’s expectations.”
Bovis is the latest housebuilder to post a strong update, following recent figures from Barratt and Berkeley.
It comes in stark contrast to its first-half results in 2017 when it booked a 31% drop in pret-tax profit to £42.7m.
The positive comments come despite reports surfacing over the weekend that Help to Buy will be scrapped in 2021, as well as warnings from rival firms over Brexit.
Bovis, which had been dogged by complaints over unfinished homes with electrical and plumbing faults including on its Round House Park and Queen’s Hill estates in Norwich, also said it has seen a significant improvement in customer satisfaction.
The company put aside £10.5m last year to cover the cost of remedial work and compensation for affected customers.