Strong house price growth and demand offsets inflation
Gleeson has reported a 2% increase in annual pre-tax profit after its bottom line was hit by having to put aside 拢12.9m for the fire safety developer pledge.
The housebuilder, in its results for the year to 30 June, reported pre-tax profit of 拢42.6m up slightly from 拢41.7m last year.
Underlying pre-tax profit, without the fire safety cost, would have increased 33.1% to 拢55.5m.
The firm鈥檚 provision for meeting costs of the fire safety developer pledge was made after a 鈥渄etailed assessment鈥� of buildings, it said.
Gleeson signed the pledge committing to fixing serious fire safety issues in blocks over 11 m in height without using government funds.
It said: 鈥淭his is management鈥檚 best estimate of the life-critical fire-safety remediation costs for these buildings based on reviews and surveys completed to date. We are in the process of undertaking a programme of intrusive inspections and fire risk assessments, where permitted by the building owners.鈥�
Gleeson increased its overall turnover 29.4% to 拢373.4m, while boosting its home sales by 10.4% to 2,000 hitting its five-year target to double sales.
It said a 14.7% increase in average selling price to 拢167,300 had 鈥渕ore than offset significant material and labour cost increases鈥�, pushing its gross profit margin on home sales up from 28.5% to 29%.
Gleeson Land reported profit of 拢13.8m, compared to 拢13.7m the previous year. It said: 鈥淭he supply of consented land has been adversely impacted by planning delays which are affecting both developers and land promoters alike.
鈥淭he planning process has been slowed by staff shortages in local councils and local authorities holding back on reviewing their Local Plans whilst potential changes in planning policy are uncertain. Natural England鈥檚 guidance on nutrient neutrality, together with phosphate and nitrate mitigation requirements, has also caused further delays across the industry.鈥�
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