Springfield Properties has announced that it expects to report an increase in profit for the year in line with current market expectations.
In its latest trading update, the Scottish housebuilder also said that its revenue should rise to £280million, up from £266million in the previous year, a figure driven primarily by a number of land sales, including five land sales as part of Springfield’s agreement with Barratt Redrow.
During the year, the Group entered an agreement to sell undeveloped land to Barratt Redrow, primarily located across Central Scotland, equating to 2,480 plots across six sites. The land sales form part of Springfield’s goal of removing the Group’s bank debt and becoming net cash positive by FY 2027. The Group’s bank debt now stands at £21million at year end, down from £39.9million on 31 May 2024. Springfield will also shift its focus to the emerging opportunities in the North of Scotland that are driven by renewable energy development and infrastructure upgrades.
A sixth land deal with Barratt Redrow is expected to be completed in the coming weeks, while discussions are continuing regarding a number of further future land holdings.
The trading update noted that private sales continued to be impacted by subdued market conditions while reservation rates remained stable compared with the second half of the previous financial year. Springfield said that, while reservation rates have remained steady, a lengthening of the sales cycle has meant that private housing completions have been slightly lower than expected.
The Group reported a year-on-year increase in revenue from affordable housing, in line with expectations and a significant improvement in gross margin. The improvement was primarily due to the Group having completed its low-margin legacy contracts at the end of FY 2024 and the contracts delivered in FY 2025 having much stronger commercial terms.
Innes Smith, CEO of Springfield Properties, said: “I am pleased that we have continued to accelerate the removal of our bank debt, keeping us on track to remove bank debt by the end of FY 2027, and achieved an increase in profit and revenue for the year. This reflects our profitable land sales to Barratt and a substantial improvement in our affordable housing gross margin, which has returned to double digits. This has put us on a firm footing to be able to capitalise on the sizable opportunities in the North of Scotland where there is significant demand for housing to support the development of net zero infrastructure, which is well underway. We are working with the infrastructure providers, the Scottish Government and the Highland and Moray councils to address this need, and we look forward to reporting on our progress.”
The Group will provide further details in its final results announcement, which is expected to be announced in September 2025.
