Housebuilder says it remains on course to meet full-year expectations

Gleeson has said interim pre-tax profit halved but expects margins to improve in the second half of the year.

The housebuilder, in results for the six months to 31 December, reported pre-tax profit of 拢3.6m, down from 拢7.2m for the same period last year.

The drop is despite a 4.2% increase in turnover to 拢157.9m and a rise in the number of homes sold from 769 to 801.

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Gleeson said profit margins were hit by increases in building costs

Gleeson鈥檚 gross homes sales margin fell from 24.5% to 20.6% with the firm saying the lower margin 鈥渞eflects build cost inflation which was not offset by selling price increases on open-market sales鈥� as well as 鈥渃ost increases on older sites nearing completion鈥�.

Gleeson鈥檚 land division did not make any sales in the half-year, posting just 拢1.3m in revenue due to accounting for a collaborative land swap with a joint venture partner, compared to revenue of 拢9.2m in the same period last year. But it said it has five sites being marketed or in a sales process.

The firm said it was confident of meeting market expectations of around 1,868 completions and 拢28m pre-tax profit in the full-year.

Gleeson also said it expects its new partnerships business, launched last June, to 鈥済ain momentum鈥�, pending a new affordable housing grant funding settlement from the government. The company has signed deals with Home Group and Lloyds-owned Citra Living.

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