Despite building close to its record total of homes in the previous year, Bellway has forecast that completions will fall by almost a third.
In the year to 31 July 2023, Bellway built 10,945 homes, just short of its record of 11,198 in 2022, but for the next 12 months, the developer has forecast 7,500 completions, a 31% reduction.
For the same 12-month period, Bellway saw its revenue fall slightly by 3.7% to £3,407million. Pre-tax profit rose by 59% to £483.0million but this was down to significantly higher legacy building expenses faced in the 2022 fiscal year, just £49.6million compared to £346.2million.
The news comes after Bellway announced that two divisions would close as part of a major restructure back in August, a move that led to around 5% of its staff losing their jobs.
Bellway to close divisions as part of major restructure
Despite the forecasted reductions, the Bellway board are confident that they overcome the downturn.
Chief executive, Jason Honeyman, said: “Bellway has delivered a resilient performance against a backdrop of rising mortgage interest rates and challenging market conditions. Looking ahead, our operational strength and experienced teams will enable the group to successfully navigate a changing market, and we will maintain a clear focus on delivering high-quality homes to our customers and making further progress against the priorities set out in our ‘Better with Bellway’ sustainability strategy.”
“The depth of our land bank and robust balance sheet provide ongoing strategic flexibility and scope for outlet growth in the year ahead. Notwithstanding the near-term market challenges, Bellway remains very well-placed to capitalise on future growth opportunities and to continue creating long-term value for all our stakeholders.”
Chair, John Tutte, said: “The long-term housing market fundamentals remain positive and there is a shortage of high-quality, energy-efficient and affordable homes across many parts of the country. Bellway has a strong operational structure, now with 20 trading divisions, which provide the capacity to organically grow volume in the longer term to over 13,000 homes per annum. The group has the ability to scale up this structure when market conditions allow, and this will ensure that Bellway continues to play an important role in increasing housing supply in the years ahead.”
