Interim Management Statement

RNS Number : 5021L

Berkeley Group Holdings (The) PLC

05 September 2012

 



The Berkeley Group Holdings plc                                                                                        

Interim Management Statement

Period from 1 May 2012 to 31 August 2012

5 September 2012

At The Berkeley Group Holdings plc ("Berkeley's") Annual General Meeting being held today, the Chairman, Tony Pidgley, will make the following Interim Management Statement which covers the period from 1 May 2012 to 31 August 2012.

"Berkeley has set a clear long term operational strategy to return £13 per share to shareholders by 2021 and to maintain the balance sheet at a similar level as at 30 April 2011.  Berkeley remains on target to achieve this.

Trading for the period has been in line with the Board's expectations. In addition, the completion of 149 properties at Grosvenor Waterside in the period, out of the 185 remaining properties which had previously been forecast to be delivered over the next three years, has benefitted earnings in the current year which are currently anticipated to be at the top end of analysts' expectations.  All these properties were paid for in full at the year end and no additional cash will be generated by the business from the acceleration of these sales.

Berkeley has acquired three sites since the beginning of the year, predominantly on deferred terms, in Wapping, Hammersmith and Chiswick, and is on target to achieve its aim of growing the value of the potential gross margin in its land holdings to £3 billion by April 2014.

Market conditions continue to remain resilient with London benefitting from its World Class status which has been enhanced by the Queen's Diamond Jubilee and the Olympics.  Limited supply of quality new housing, particularly in the best locations in London and the South East, continues to provide strong support for house prices despite the underlying economic conditions and lack of feelgood factor.

Housing has to become a national priority, not just for Government but for the whole country.  This does require the presumption in favour of sustainable development within the NPPF to be enforced.  Housing can also be part of the economic recovery as every home built by Berkeley creates some 3.5 jobs alongside the associated benefits of affordable housing, infrastructure improvements, creating fantastic new homes and vibrant places.  The Government has a vital role to play in stimulating investment by creating a stable, consistent and transparent platform to allow housing to be developed, however the changes in planning and the consultation on the taxation of residential properties have introduced uncertainties for businesses such as Berkeley.

Consequently, this is expected to lead to lower levels of investment in housebuilding generally. This means for Berkeley that we will maintain a strong and flexible balance sheet while investing more selectively in land and construction and therefore expect to be cash generative in the first half.

As previously announced, Victoria Mitchell, the Non-Executive Deputy Chairman is today stepping down from the Board after ten years of continuous service and I would like to thank Victoria for her significant contribution to the Group over this time."

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For further information please contact:

The Berkeley Group Holdings plc                                                            Cardew Group

R C Perrins                                                                                           Tim Robertson

N G Simpkin                                                                                          Georgina Hall

T: 01932 868555                                                                                    T: 0207 930 0777

 

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