Springfield Properties report strong full year results
Springfield Properties has reported strong growth, with delivery on all targets after the release of its full-year results.
The housebuilder, who deliver both private and affordable housing, has announced its rate of completion of new homes increased by 23.6% to 952, from a previous 770. They have also reported strong revenue and gross margin growth across both private and affordable housing.
The company’s revenue has increased by 36%, from £140.7 million in 2017/18 to £190.8m this year.
The results have also revealed that Springfield expanded its 16-year land bank to 15,938 plots from a previous 12,476, 28.4% of which have planning permission, and Gross Development Value (GDV) of the land bank at 31 May 2019 increased to £3.2 billion from £2.4bn in 2018.
In its delivery of private housing, Springfield reported a revenue increase of 40.6% from £101.9m in 2017/18 to £143.3m in 2018/19.
The company’s rate of completions also increased by 37% to 630 homes, from a previous 460.
The reports also revealed that the average selling price of Springfield’s private housing increased by 2.7% from £222k to £227k.
Discussing the results, Sandy Adam, executive chairman of Springfield Properties, said: “I am pleased to report another year of strong growth for Springfield. We increased our revenue from both private and affordable housing and achieved significant improvement in gross margin. We expanded our geographic presence and scale and made great progress with our Village developments, with the most advanced strengthening in appeal as they become increasingly established new communities.”
The chairman also said: “Throughout our history, Springfield’s strategies have been designed to secure growth and future-proof the business. We have been successful in achieving this in the past and this continues to be our focus for the future. With our strong land bank of nearly 16,000 plots, the progress that we’re making with our Village developments and sustained market drivers, we are well-positioned for continued growth. On behalf of the Board, I thank our shareholders for their support and look forward to providing further updates on our achievements.”
Innes Smith, chief executive officer of Springfield Properties, said: “This was another great year for Springfield as we delivered on all of our targets and strengthened our ability to deliver sustained growth. In particular, our investments in the acquisition of Dawn Homes, Walker Group and our four high calibre managing directors have greatly enhanced our business. None of this would have been possible without the skill and hard work of our employees, for which we thank them. With a great product, an excellent team and sustained demand for housing in Scotland, we have established a solid pipeline and remain on track to deliver continued growth in line with market expectations.”
John Moore, senior investment manager at Brewin Dolphin, said: “Springfield Properties used its IPO, which is coming up for its second anniversary, as a solid foundation for growth. The business has since delivered on that ambition, with revenues, margins, and profits all up on this time last year and acquisitions of regional champions Dawn Homes and Walker Group cementing its position in Scotland. Springfield differentiates itself from other stock market quoted housebuilders with a significant social housing element, which offers potential growth that is less sensitive to the housebuilding sector’s traditional influences – such as rising interest rates and second-hand house prices. In the short term, investors will keep an eye on rising debt levels, principally due to acquisitions, as most other listed housebuilders sit with cash or near cash at this stage in the cycle. However, the proposed dividend increase shows the confidence that management has in the future.”