LONDON (Alliance News) - Retirement housebuilder McCarthy & Stone PLC on Wednesday noted its strong order book which, in normal conditions, would be sufficient to deliver its targeted 20% increase in sales volumes for the full year, but cautioned uncertainty resulting from last week's UK voted to leave the European Union may impact the conversion of its order book to completions.
McCarthy & Stone said its order book of forward sales at June 24 was GBP426.0 million, a 23% rise from the GBP328.0 million recorded at the same time a year earlier, and the housebuilder noted it also has all the reservations it needs to deliver full-year completions in line with market expectations. Its order book, the company said, would normally be "sufficient" to deliver its targeted 20% increase in sales volumes over the full year to the end of August.
However, McCarthy & Stone said the uncertainty in the broader UK economy and particularly in the housing market may have an impact on the timing and cost of conversion of its strong order book of reservations into completions, which it said it will continue to monitor.
McCarthy & Stone noted it has made progress with the roll out of its "substantial and profitable land bank" since the start of 2016, acquiring 58 development sites since January, in line with the same period a year earlier, and achieving 43 full planning consents, compared to the 38 achieved a year earlier.
McCarthy & Stone said it also released 38 new sales outlets since the start of 2016, which contributed to an 18% increase in its weekly net reservation rate above the same period a year earlier.
"Notwithstanding any short-term market impact of last week's referendum result, the business remains in good shape to deliver on its medium term strategy. We now have sufficient sites in build to deliver our 2017 targeted sales and sufficient land under our control to deliver on our strategic objective of building and selling more than 3,000 specialist retirement homes in 2019, although we will continue to review our investment plans and monitor housing market developments following the referendum result. We continue to target return on capital employed in excess of 25% over the medium term," said Chief Executive Clive Fenton.
By Hannah Boland; hannahboland@alliancenews.com; @Hannaheboland
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