Jason Honeyman, group CEO at Bellway

Bellway upgrades price guidance, warns of election hit

Bellway has upgraded its price guidance for new units amid a resurgence in selling activity over recent months.

However, in a trading update for 1st February to 2nd June, the housebuilder warned the general election could impact business.

Over this period, Bellway’s private reservation rate per outlet per week of 0.62 increased by 6.9% compared to the same period in 2023.

Off the back of this, the company’s forward order book has increased from 4,411 homes at the start of the financial year to 5,346 as of 2nd June.

A year before, on 4th June, this had been 6,172 homes.

Bellway has re-evaluated its pricing guidance and the overall average selling price is now anticipated to be £305,000 up from £295,000.

This is nearer the £310,306 average price estimated in July 2023.

However, this has not led to an updating of Bellway’s financial guidance — the housebuilder still expects a 6% contraction to its operating margin for the year, and the interim dividend remains reduced at 16p (down from 42p).

The group also had net debt of £57m as of 2nd June, up from net cash of £42m in 2023.

Bellway remains on track to deliver 7,500 homes by the end of its financial year — down from the 10,945 delivered by July 2023.

Citing a “strong and well-capitalised balance sheet”, Bellway’s management are confident but warned about the impacts of the UK’s general election.

In the commentary accompanying the update, Bellway warned of a “temporary impact to trading as political campaigning continues” but highlighted positive long-term fundamentals.

“We have been encouraged by ongoing healthy levels of customer interest and combined with the strength of our outlet opening programme, we continue to expect a year-on-year increase in the forward order book at 31 July 2024,” said Jason Honeyman, group CEO at Bellway (pictured above).

“As a result, Bellway remains in a strong position to return to growth in [the] financial year 2025. We reiterate our confidence that the group’s robust balance sheet and operational strength, combined with the depth of our land bank, will enable Bellway to successfully capitalise on future growth opportunities.”

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