Countryside Properties Plc Another year of strong growth with returns ahead of expectation

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Countryside Properties Plc (LON:CSP), a leading UK home builder and regeneration partner, today announces its results for the year ended 30 September 2018.

Results highlights

	2018	2017	Change
Completions	4,295	3,389	+27%
Adjusted revenue¹	£1,229.5m	£1,028.8m	+20%
Adjusted operating profit^{2, 6}	£211.4m	£165.3m	+28%
Adjusted operating margin^{3, 6}	17.2%	16.1%	+110bps
Adjusted basic earnings per share^{4, 6}	36.0p	27.7p	+30%
Return on capital employed^{5, 6}	37.1%	30.6%	+650bps
Dividend per share	10.8p	8.4p	+29%
Reported revenue	£1,018.6m	£845.8m	+20%
Reported operating profit	£149.3m	£128.9m	+16%
Basic earnings per share⁶	33.1p	27.2p	+22%

Group highlights
· Sector-leading growth with 27% increase in completions and 28% growth in adjusted operating profit
· Operating margin, return on capital employed and cash all ahead of expectations

· Net reservation rate of 0.80 (2017: 0.84) from 60 sales outlets (2017: 47 sales outlets)
· Private Average Selling Price (“ASP”) of £402,000 (2017: £430,000) reflecting geographical mix, with underlying house price inflation of 2%

· Westleigh integration underway with new regional structure in place for future growth
· Group forward order book up 40% to £900m (2017: £644m) of which private forward order book £215m (2017: £242m)

Partnerships highlights
· Completions: 3,019 homes (2017: 2,192) up 38%, 465 homes from Westleigh
· Adjusted operating profit: £110.6m (2017: £79.4m) up 39%
· Adjusted operating margin: 17.4% (2017: 16.7%) up 70 bps
· Land bank plus preferred bidder: 29,878 plots (2017: 19,223) up 55%

Housebuilding highlights
· Completions: 1,276 homes (2017: 1,197) up 7%
· Adjusted operating profit: £109.6m (2017: £91.5m) up 20%
· Adjusted operating margin: 18.4% (2017: 16.6%) up 180bps
· Land bank: 19,778 plots (2017: 19,826) of which 85% has been strategically sourced

Outlook and current trading
Net reservation rates for the first seven weeks of the year are in line with the same period last year and towards the top of our expected range. Our guidance for the medium term remains on track, including 10% to 15% completions growth. In 2019, we expect completions growth in excess of 30%, in part due to the acquisition of Westleigh. This growth will be largely PRS and affordable, reducing our exposure to private for sale homes to around 35% of total completions in the coming year. With our forward order book up 40% to £900m, we remain well positioned to deliver current year expectations.

Commenting on the results, Ian Sutcliffe, Countryside Properties Group Chief Executive, said:
“We have continued our strong growth trajectory during the past year and have exceeded our expectations in operating margins, return on capital employed and cash generation. Our differentiated Partnerships division continues to go from strength to strength, while our Housebuilding division is benefitting from operational efficiency and continued capital discipline to deliver improved returns. With strong demand from first-time buyers and ongoing political support, the Board looks forward to delivering continued growth from both of our operating divisions.”

There will be an analyst and investor meeting at 9.00am GMT today at Chartered Accountants Hall, One Moorgate Place, London, EC2R 6EA hosted by Group Chief Executive, Ian Sutcliffe. The presentation will also be available via a live webcast through the Countryside corporate website http://investors.countrysideproperties.com/