Bellway rings up 50% sales increase

Bellway, the housebuilder, beat City forecasts with its full-year figures yesterday and it said that current forward sales were running at almost 50 per cent higher than last year.

The company, which for the first time built more than 6,000 homes in a year, ending 31 July, said it was looking for a 10 per cent rise in its average selling price this year to £132,000.

The last financial year saw a 24 per cent jump in pre-tax profit, to £125.3m, despite only seeing a "slight" increase in average selling price, as Bellway's sales mix changed. The operating margin improved from 15.4 per cent to 17.2 per cent, which the company said was sustainable

Howard Dawe, the chairman, said: "I am delighted to report that we have had our most successful year ever. We ended the financial year with our strongest forward sales position ever. I am extremely optimistic about the future."

Bellway said that since 1 August, demand across all divisions has remained strong and the forward sales position, at £325m, is 47 per cent ahead of last year. In the first 11 weeks of the financial year, Bellway has sold houses representing more than half its annual sales target. John Watson, the chief executive, said: "Despite the total home production in the UK falling to its lowest level in 54 years, Bellway has, since 1992, trebled the number of homes sold and quadrupled its market share with all of this growth having been achieved organically."

Bellway's shares closed up 12.5p at 477p as it said analysts should raise forecasts for the current year. "I would imagine we would be able to beat market forecasts. In fact, I would be disappointed if the market does not upgrade us to a number in the 130s [£m]," said Alistair Leitch, finance director.