Pete Redfern, Chief Executive, commented:
"We have used the opportunity of a stable and positive housing market to make significant progress towards our medium term financial and quality objectives. We are confident of achieving the three year financial targets that we established in 2014, and continue to invest in recruiting and developing our people and enhancing the quality of our homes.
In line with our strategy, we have proposed a cash return of £300 million to be paid in July 2016, which takes our total cash returns to shareholders since we started the programme in 2014 to £600 million."
Highlights
Strong 2015 first half performance:
o Completed 5,842 homes (excluding joint ventures) across the UK, with a 9.2% increase in total average selling price to £225k (H1 2014: 5,695 homes at £206k), in a resilient and growing housing market
o Record contribution of £55.9k per completion (H1 2014: £45.3k per completion)
Significant progress made towards the Group's three year medium term targets:
o Operating profit margin up 310 basis points to 19.2% (H1 2014: 16.1%)
o Return on net operating assets up 540 basis points to 23.2% (H1 2014: 17.8%)
o Tangible net asset value per share† increased by 11.5% to 82.1 pence (H1 2014: 73.6 pence), with 15.6% growth in net assets before cash distributions†††
o Converted 45% of operating profit* to operating cash flow (H1 2014: 27%) on a rolling 12 month basis
Further cash return of £300 million proposed, to be paid in July 2016, 20% ahead of the 2015 payment (July 2015: £250 million), reflecting increased cash generation and profitability
Interim maintenance dividend of 0.49 pence per share (H1 2014: 0.24 pence per share) to be paid on 2 October 2015
Well placed to deliver further sustainable growth in returns and completions during 2015 and beyond:
o Landbank strong at 77k plots, with over 50% sourced from the strategic land pipeline
Acquired 3,620 high-quality plots in the UK short term land market
Converted 5,666 plots from the strategic pipeline
o Excellent order book as at 28 June 2015 representing 8,120 homes (29 June 2014: 7,587) and a record total value of £1,859 million (29 June 2014: £1,584 million)
o Selected with partner Dorchester Regeneration by the Ministry of Defence to develop Prince Phillip Barracks in Bordon, Hampshire, which will deliver c.2,400 much needed new homes and infrastructure over 15 years
Contributed c.£166 million to local communities in which we build across the UK via planning obligations, providing local infrastructure, affordable homes, public transport and education facilities (H1 2014: £116 million)
