Operational highlights
2012 profit before tax at the upper end of market expectations
Strong profit growth reflecting compound positive effect of:
15% growth in legal completions to 2,355 homes (2011: 2,045) from an average of 82 active sales outlets in 2012 (2011: 73)
5% increase in average sales price to £170,700 (2011: £162,400)
Significant increase in operating profit margin to 13.4% (2011: 10.0%)
Strong land investment in 3,501 consented plots during 2012:
2,651 plots added to the consented land bank during the year
850 consented plots legally contracted, awaiting satisfaction of conditions, of which 408 plots have been added to the consented land bank during early 2013
Significant growth in future profit potential with 13,776 consented plots at 31 December 2012, with potential gross profit of £600 million, calculated using current sales prices and current build costs (31 December 2011: 13,723 plots with gross profit potential of £524 million)
19,318 potential plots of strategic land as at 31 December 2012 (2011: 18,749 potential plots)
Current trading
350 private reservations achieved in first eight weeks of 2013 (2012: 320), an increase of 9%
Average sales price on cumulative private reservations for 2013 to date increased to circa £200,000 (2012 full year average private sales price: £188,700), with sales prices achieved in line with Group expectations
Investment in 611 new plots of consented land during the first eight weeks of 2013 continuing to fuel growth
Commenting, David Ritchie, the Chief Executive of Bovis Homes Group PLC said:
"The Group delivered strong growth in profit and return on capital employed in 2012 in a challenging but stable market environment. These improvements have been achieved through the compound positive effect of increased volumes, improved sales prices and stronger margins.
"Significant progress has also been made in positioning the Group for sustained improvements in future shareholder returns. After another year of substantial land investment in 2012, the Group expects to deliver a strong increase in active sales outlets in 2013. Assuming a continuation of stable market conditions, this will further enhance volumes, sales prices and profit margins.
"Combined with driving profitability, the Group is aiming to deliver enhanced shareholder returns from improving the efficiency of its capital employed through continuing its focus on both land bank management and tight control of working capital.
"As a result, on the basis of stable market conditions, the Group will deliver strongly increasing returns on capital employed in 2013, with the expectation of continuing progress for the foreseeable future.
"On 22 February, the Board announced the forthcoming retirement of Malcolm Harris, non executive Chairman, in November 2013. Malcolm has been Chairman for nearly five years and has led the Group through a period of strong growth in shareholder returns. I would like to thank him for his support personally and his significant contribution to Bovis Homes over many years. I wish him well for the future.
"I would like to recognise the considerable effort, commitment and hard work of our employees during 2012 and to thank them all for their contribution to the Group's success."
