Galliford Try has stated that Brexit will likely affect Linden Homes more than any other market due to declining consumer confidence.
Reporting on its annual results, construction, housebuilding and regeneration business, Galliford Try, stated that depending on the circumstances of the UK’s exit from the European Union, “the biggest impact we foresee is the effect on our markets, and on the Linden Homes market in particular, of a potential severe decline in consumer confidence and economic activity in general”.
This potential drop in consumer confidence and economic activity “could coincide with Linden Homes’ autumn selling season,” GT continued.
But it added that it was “as prepared as possible” for any disruption, and it had considered the impact of Brexit on its supply chain, engaging with suppliers across all of its businesses.
Despite the overhanging threat, Linden Homes made further strong progress during the year ending June 30 2019, GT said, “delivering on its strategic objectives, achieving good financial performance, and preparing for further growth and margin progression.”
Its margin was broadly in line with last year at 19.6% (2018: 19.5%).
But completions fell slightly from 3,442 units last year to 3,229, of which 2,227 were for private housing against 2018’s 2,587. Meanwhile, affordable housing units increased from 855 in 2018 to 1,002.
Linden’s average selling price fell, as planned, from £310,000 in 2018 to £284,000.
Around 80% of Linden’s planning applications now use The Linden Collection, its third generation of standard layouts that it introduced in the previous financial year.
GT also said Linden had achieved a “strong” four-star rating in the HBF/NHBC customer satisfaction survey, an improvement on last year.
And, currently, it was seeing improving demand after the usually quieter summer weeks, “with prices and margins remaining firm”.
Graham Prothero, GT’s CEO, said: “We continue to make great progress in Linden Homes, focusing on the benefits of standardising our range and rationalising process.
We are building homes more cost effectively while delivering well-designed, high quality units which meet our customers' needs, as reflected in our improving satisfaction scores. We continue to head towards our target of 80% of completions being Linden Collection.”
Following yesterday’s announcement that GT had resumed talks with Bovis Homes on selling its housing and regeneration businesses to the housebuilder, Prothero added: “The potential combination of our Linden Homes and Partnerships businesses with Bovis Homes represents a superb opportunity, enhancing the prospects for all three of our businesses to thrive as strategically focused and well-financed operations with excellent opportunities for growth.
The transaction allows construction to continue trading as a standalone well capitalised business."