The Investment Column: Bryant looks a good building bet
Wednesday 04 February 1998
On the face of it the group's 38 per cent rise in profits to pounds 21.3m in the six months to November certainly adds weight to his argument, and the sector rose more than 3 per cent yesterday. Bryant's growth comes from a 10 per cent rise in average selling prices, which helped operating margins recover from 7.7 per cent to 11 per cent, much nearer to the industry average.
But Bryant is an perfect example of the industry's past follies. It is still paying the price for over-expanding a few years ago when it misread the market, which meant profits almost halved to pounds 24.6m in 1996. Even now it has not finished restructuring the business and first-half completions fell 5 per cent to 1,752.
There are also growing fears that builders are at risk from rising labour costs. And Bryant would be more exposed than most if the Government introduces taxes on greenfield sites.
However, there are several reasons why Bryant looks a better bet than most in the sector. Its costs rose 5 per cent last year but are now moderating, as are land prices. And after gearing up its land bank, the group is still on target to sell 4,000 houses by the end of the current year and 4,500 next.
Bryant's shares jumped 9p to 122p on the buoyant results. Analysts have upped forecasts for the current year from pounds 49m to pounds 50m, rising to pounds 60m in the year to May 1999, putting the shares on a prospective p/e ratio of 10, then just 8. The shares look a buy, but as with any house-builder, investors should watch closely for any signs of a cyclical downturn.
- 1 PlayStation and Xbox hacked by Lizard Squad
- 3 The Grace Dent Christmas Questionnaire
- 4 The 'Black Museum': After 150 years, public set to see exhibits from police’s grisly crime museum
PlayStation and Xbox hacked by Lizard Squad
Antonio Martin shooting: Black teenager may have tried to ambush patrolman, says police officer's lawyer
Katie Hopkins speaks out on childhood obesity: 'Parents of fat children should be prosecuted for child cruelty'
Boxing Day snowfall set to push even more bargain-hunters online for sales
The 'Black Museum': After 150 years, public set to see exhibits from police’s grisly crime museum
British actor Idris Elba cannot star as James Bond because he is black, says shock jock Rush Limbaugh
Rozanne Duncan: Ukip expels councillor for 'jaw-dropping' comments made in BBC TV interview
Germany anti-Islam protests: 17,000 march on Dresden against 'Islamification of the West'
Ukip member gets into Christmas spirit with Union Flag plea to Santa 'for our country back'
BBC director Danny Cohen: Rising UK antisemitism makes me feel more uncomfortable than ever
Alex Salmond has 'broken his word to the Scottish people' says Scottish Lib Dem leader
iJobs Money & Business
Highly Competitive: Selby Jennings: Our client, a leading European Oil trading...
£43500 per annum + pension + holidays: The Jenrick Group: Night Shift Operatio...
£20000 - £25000 per annum + OTE £40,000 + Car + Pension: SThree: SThree are a ...
£20000 - £25000 per annum + OTE £35K: SThree: We consistently strive to be the...