Crest Nicholson profits down on London home sales

Crest Nicholson's revenues increased early in the year, signaling that the withdrawal of British homebuilders from the private sales market in London could be successful.

In response to the market downturn in London and the South East, Crest Nicholson has focused its business on partnerships and joint ventures, an approach that eliminates balance sheet risks by securing the sale of multiple units prior to completion. the profit expense on each sale.

The home builder, through partnerships with housing badociations and private rental operators, is now selling about 45% of its homes before completion.

Revenues rose 7 percent to 501.9 million pounds in the six months ended April 30 from the same period last year, the company said Tuesday. The abandonment of the private market, however, detracted from the results of FTSE 250. Pre-tax profits decreased by 11% compared to the same period of the previous year.

Noting the increase in revenue, Liberum badysts said the company "was starting to see the fruits of its revised strategy more quickly than we originally anticipated nor management."

Crest Nicholson has announced an average selling price of £ 413,000 for his homes and hinted that this figure would be falling as he reduced his building to high value areas such as London.

The home builder aims to return profits to shareholders rather than develop the business, in what he described as an uncertain period for the market.

Chris Tinker, Acting Director General, described the results as "satisfactory progress" in the context of "increased political uncertainty".

In March, Crest Nicholson seconded Peter Truscott to rival builder Galliford Try, where he was the general manager. Mr. Truscott replaced Patrick Bergin, who had been with the company for 13 years and had been General Manager since 2018.

Shares of the company have gained 8% since the beginning of the year, increasing from 0.5% early Tuesday to 359.6%. The modest increase of 2019 follows a difficult year for the company, which issued a warning on its profits in October and saw its shares slide from 549 to 328p during this year.

Fund manager Neil Woodford retains a 10% interest in the company. He recently reduced his stake by 15%, according to regulatory documents released last week.