Bovis Homes expects to post record profit for 2018

Housebuilder Bovis Homes has said it expects to post a record year of profit and cheered “encouraging” early signs for trading in 2019.

The group said it is set to see profits for 2018 that are slightly ahead of market expectations after a “significant step-up” in operating margins.

Bovis also expects to increase the payout for shareholders and intends to post a final dividend of 38p a share, up from 32.5p the previous year.

It said the UK housing market “remains strong with customer demand for new homes supported by attractive mortgage finance and government initiatives”, in particular the Help to Buy scheme.

Bovis said that while it is too early to comment about trading for the new year, early signs are “encouraging”.

It has started the year with forward sales of 2,681 units with a value of £521 million.

In November, the company said uncertainty surrounding Britain’s departure from the EU was driving a slowdown in buyers of larger homes.

But in its latest update, Bovis said that building on its improved relationships with housing associations, it has increased private sales to housing associations.

For 2018, the group delivered 3,759 new homes, a 3% increase compared with the year earlier and the average selling price rose to £273,000 from £272,400 in 2017.

Chief executive Greg Fitzgerald said: “The significant improvement in operational performance across all areas of the business is expected to deliver a record year of profits for the group.

“Customer satisfaction is a key priority and the group’s return to four-star housebuilder status along with another controlled and disciplined period end reflect this.

“We are looking forward to delivering the first homes from our new housing range in 2019 and continuing to make further operational and financial progress.”