# Bovis Homes Group PLC Excellent operational progress, 47% increase in profits

- Link: https://www.directorstalkinterviews.com/bovis-homes-group-plc-excellent-operational-progress-47-increase-in-profits/412768304
- Published: 2019-02-28T08:19:46+00:00
- Author: Charlotte Edwards

**Bovis Homes Group PLC** (LLON:BVS) is today issuing its full year results for 
the 12 months ended 31 December 2018.

**Highlights**

– Significant operational improvements deliver step change in business and financial
performance

– Transformation of customer service and 4 star HBF customer satisfaction rating
for 2018

– Record year of profits with profit before tax increasing 47.4% to £168.1m, ahead
of market expectations

– Another controlled and disciplined period end with completions totalling 3,759
units

– 390 basis points increase in operating margin with further progress expected in
2019

– Strong land acquisition including valuable strategic land conversion

– Excellent visibility on land with all land for 2019 having detailed consent and
97% of 2020 requirement secured

– Progress on balance sheet optimisation initiatives and now aiming for c. £250m
additional net cash benefit with £180m achieved to date

– Step up in return on capital employed from 13.7% to 19.3%

– Excellent progress towards achieving all of our medium term targets

– Board recommending a 20% increase in ordinary dividend for FY18 to 57.0 pence 
per share reflecting the strong performance and its confidence in the outlook for
the business

  |

FY18

  |

FY17

  |

Change

  |  
 |

Total completions

  |

3,759

  |

3,645

  |

+3.1%

  |  
 |

Average selling price

  |

£273.2k

  |

£272.4k

  |

+0.3%

  |  
 |

Group revenue

  |

£1,061.4m

  |

£1,028.2m

  |

+3.2%

  |  
 |

Operating margin

  |

16.4%

  |

12.5%

  |

+390bp

  |  
 |

Profit before tax

  |

£168.1m

  |

£114.0m

  |

+47.4%

  |  
 |

Earnings per share

  |

101.6p

  |

68.0p

  |

+49.4%

  |  
 |

Total dividend per share

  |

102.0p

  |

47.5p

  |

+114.7%

  |  
 |

Net cash

  |

£126.8m

  |

£144.9m

  |

(12.5)%

  |

> **Greg Fitzgerald, Chief Executive commented,**
> “The Group has made substantial progress operationally over the past 18 months
> delivering record profits and a step change in our operating margin. We have transformed
> the quality of our product and customer service and are delighted this is reflected
> in our 4 star housebuilder status for 2018.
> “Looking ahead, we are implementing many initiatives which will continue to build
> a better Bovis Homes including our new Phoenix housing range with its first completions
> this Spring, and the development of our new Partnership Housing division. We have
> a strong sales position and excellent land visibility and expect to make further
> operational and financial progress in 2019.”

**Current trading and outlook**

– Good demand in first eight weeks with average sales per site per week up 15.7%
to 0.58 and pricing in-line with expectations

– Strong forward sales position with 48% of consensus FY19 revenues secured

– Group remains focused on controlled volume growth, price optimisation and margin
enhancement

– Good progress with new Phoenix housing range and first completions expected in
H1 19

– Maximising partnership housing opportunities with creation of a Partnership Housing
division in 2019

– On track for completion of Wellingborough JV with c. £68m net cash benefit

– Further operational and financial progress expected in 2019

 

Share on: