Bovis to restore dividend as housing market improves
Saturday 10 July 2010
Bovis cheered investors with plans to reinstate its dividend next year, as it became the latest housebuilder to report rising property prices and sales.
The company stopped paying dividends 18 months ago as the recession forced it to slash its workforce by 40 per cent, restructure its debt and focus more on social housing.
But Bovis said it intended to resume the payments at the end of this financial year, "assuming the continuation of current market conditions in the new homes market". It said this change of heart was prompted by confidence about its medium-term prospects, its net cash position of £79m and its investments in land. Over the six months to 30 June, Bovis completed 803 home sales – 6 per cent more than in the same period a year ago.
For private properties, the group's average sale price for the half-year was £163,500, compared to £160,400 last year. Bovis said it had been delivering "solid" private weekly sales rates and achieving prices ahead of its own expectations. However, when the greater proportion of social housing was taken into account, the builder's average selling price slipped slightly, from £159,700 to £158,500. The cautious optimism voiced by Bovis followed a half-year update earlier this week from its rival Persimmon, which also said it was selling more homes and at higher average prices.
Bovis said it had added to its land bank about 1,900 plots with planning consent this year and had agreed terms on a further 2,500. The builder has been using the £60m raised through a shares placing last September to take advantage of cheap land prices.
Nevertheless, Bovis warned that the market for new homes remained "subdued", blaming the "ongoing liquidity" issues faced by first-time buyers, which is limiting transaction volumes and keeping sale prices low. According to the Halifax, property prices dropped by 0.6 per cent last month following a similar decline in May.
- 1 Apple has installed security backdoors on 600m iPhones and iPads, claims security researcher
- 2 UK pirates will get four warning letters a year
- 4 Is Gideon Levy the most hated man in Israel or just the most heroic?
- 5 Israel-Gaza conflict: Deadly flechette shells 'used by Israeli military in Gaza Strip’
Hacking Trial: Rebekah Brooks, Raisa and a new twist in the saga of a horse fit for a Prime Minister
Israel-Gaza conflict: Palestinian death toll now exceeds 500 – but Israel fights on
Income tax league: Revealed - the UK towns where people pay the most and least tax
Israel-Gaza conflict: Deadly flechette shells 'used by Israeli military in Gaza Strip’
Malaysia Airlines MH17 crash: Blogger captures footage ‘showing BUK missile launcher that shot down jet’ now back in Russia
Malaysia Airlines flight MH17 crash: 'Nine Britons, 23 Americans and 80 children' feared dead after Boeing passenger jet is 'shot down' near Ukraine-Russia border
Malaysia Airlines MH17 crash: Vladimir Putin is given 'one last chance' to end hostilities in Ukraine
The 'scroungers’ fight back: The welfare claimants battling to alter stereotypes
The truth about conspiracy theories is that some require considering
Malaysia Airlines MH17 crash: Ukrainian military jet was flying close to passenger plane before it was shot down, says Russian officer
Malaysia Airlines MH17 crash: victims’ bodies bundled in black bags and loaded onto trains
iJobs Money & Business
£850 - £950 per day: Orgtel: Programme Director - Conduct Risk - Banking - £85...
£45000 - £50000 Per Annum + excellent benefits: Clearwater People Solutions Lt...
£250 - £300 per day + competitive: Orgtel: Finance Manager - Accountant - Bank...
£100000 - £120000 per annum + BONUS + BENEFITS: Harrington Starr: A leading fi...