Bovis Homes profit slumps 80%

Bovis Homes' interim pre-tax profit has plummeted more than 80% to £9.5m, just 16% of the figure of £58m it made in the comparable period last year.

David Ritchie, chief executive, said Bovis had seen “the toughest period of trading it has experienced in its time as a public company”

Bovis has wielded the axe to minimise the impact of the troubles within the house building sector at the moment:

• 40% of jobs have been cut
• the eastern regional office has closed
• much of the north and central region functions have been amalgamated

Bovis’s latest financial figures cover the six months to 30 June. Turnover was well down at £150m, representing a fall of £110m on the previous figure of £260m.

The number of sales ran to 850, much lower than the figure of 1,300 in the first half of 2007.

The latest completions divided between:

• 73% - private homes (figure of 87% in H1 of 2007)
• 27% - social and partnership homes (figure of 13% in H1 of 2007)

The average price of a private house was £197,000 which represents a 4% fall on the previous figure of £205,000 though the true difference was larger as the latest average size of 90m2 is lower than the previous figure of 95m2.

Bovis’s average price for its social and partnership homes was £88,000, a 3% decline on the previous year’s figure of £90,000.

Ritchie said that Bovis has largely avoided new investments in consented land and has cut production levels.

The group has not required write-downs, he commented, and its gearing (i.e. the ratio of debt to assets) has remained low at 13%.