Bovis Homes Group PLC (LON:BVS) is holding its Annual General Meeting at 12:00pm today in Tunbridge Wells. This statement comments on the Group’s current trading and outlook for the financial year.
Greg Fitzgerald, Chief Executive commented:
“We have seen a strong period of trading including a step up in our sales rate. I am delighted to see the transformation in the way we operate reflected in our high build quality and continued strong improvements in customer satisfaction. We are on track to deliver another controlled and disciplined period end and make further operational and financial progress in this financial year.”
Current trading
We have seen good demand in the year to date with an average private sales rate per site per week of 0.61 (2018: 0.52), a 17% increase on the prior year.
We were pleased to be awarded 4 stars by the HBF in its latest annual customer satisfaction survey results and are delighted to report that we are currently trending ahead of this level in the current HBF year. Delivering high quality homes and excellent customer service remains a key priority for the Group and this will be further enhanced following the recent launch of our new Customer Relationship Management system.
We have opened 7 new developments in the year to date and are operating from an average of 87 active sites. We expect to open a further 16 new sites this year, and our average active sites for 2019 to be at a similar level to the prior year (2018: 87).
We have made excellent progress with the roll-out of our new Phoenix housing range with further sites replanned and show homes opened. We are now looking forward to the first legal completions from the new range in the coming weeks and remain confident the new house types will deliver an enhanced sales proposition for our customers, improved build efficiency and a reduction in costs.
Our overall improved cost control continues and alongside our margin initiatives, this is offsetting the impact of limited sales price inflation and build cost inflation running at c. 3 to 4%.
We continue to have excellent visibility on land with 98% of our land for our 2020 completions secured and 68% secured for 2021 (excluding strategic land contributions). We are seeing good opportunities in the land market that at least meet our minimum hurdle rates.
At the time of our full year results in February we highlighted the creation of our Partnerships Housing division. As previously announced, the completion in April of our joint venture at Stanton Cross, Wellingborough with Riverside, one of the UK’s leading registered providers of social housing, is a great example of our land led strategy and working in partnership.
Dividends
Subject to shareholder approval at today’s AGM a final dividend in respect of the 2018 financial year of 38.0p per share (2017: 32.5p per share) will be paid on 24 May 2019, giving a total dividend for 2018 of 57.0p per share (2017: 47.5p per share). Including the special dividend of 45p per share paid in November 2018, dividends paid in the 12 months total 102p per share.
Outlook
The current market fundamentals remain strong and we continue to see good levels of demand for new homes across all of our operating regions. We have a strong forward sales position and are confident of delivering completions in line with our expectations for the year.
The Group set out its medium term targets to be achieved by 2020 to return Bovis Homes to being a leading UK housebuilder and significantly improving returns to our shareholders. We continue to make good progress against these targets with several already achieved. We expect to make further progress on the Group’s operational and financial performance in the current year.
