Bellway plc forecasts a 25% increase in full-year housing completions

By: Wajeeh Khan
Wajeeh Khan
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on Dec 11, 2020
  • Bellway plc forecasts a 25% increase in full-year housing completions.
  • The property developer says its forward order book stands at £1.77 billion.
  • Bellway forecasts roughly 5,321 housing completions in fiscal H1.

In an announcement on Friday, Bellway plc (LON: BWY) said home orders surged significantly in the last four months, that it attributed to public assistance schemes and tax cuts that made people buy more property.

Bellway shares opened about 1% up on Friday but lost close to 5% in the next hour. Including the price action, the British residential property developer is now trading at £27.19 per share. In comparison, it had a per-share price of a sharply lower £18.79 in March when the COVID-19 crisis weighed on the housing market. Bellway had started the year 2020 at £38.50 per share.

Bellway says its forward order book stands at £1.77 billion

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Bellway said on Friday that its forward order book stood at £1.77 billion in the 17 weeks that concluded on 29th November, representing an 18.7% growth as compared to the same period last year.

The residential property developer acknowledged the uncertainties associated with the Coronavirus pandemic, Brexit, and shift in government support schemes, but said that it was cautiously optimistic about its performance in the upcoming months. The COVID-19 crisis has so far infected more than 1.7 million people in the United Kingdom and caused over 63 thousand deaths.

The housing market in the UK recovered quickly in recent months after a prolonged halt due to the ongoing pandemic. In November, the construction industry recorded the broadest increase in new orders in almost 7 years. House prices also surged in recent months as the government eased COVID-19 restrictions.

Bellway forecasts roughly 5,321 housing completions in H1

Bellway now forecasts a 25% year over year growth in housing completions in the fiscal year that will conclude on 31st July, 2021. Last year, the British company had reported 7,522 completions. Owing to the new COVID-19 restrictions imposed by the government in November, however, the reservation rate, as per Bellway, saw a decline last month.

For the fiscal first half to conclude on 31st January, Bellway now forecasts 5,321 completions that is roughly unchanged from last year. The residential property developer had reinstated dividend payments on the back of recovery in the UK housing market in October.

Bellway performed fairly upbeat in the stock market last year with an annual gain of roughly 50%. At the time of writing, the Newcastle upon Tyne-based company is valued at £3.34 billion and has a price to earnings ratio of 17.37.

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