Berkeley reservations down 20%

London housebuilder Berkeley Group has reported a 20% decline in reservations over the past six months compared to the year before, and a 9% fall in forward sales on the preceding half year. It said in a trading statement that, excluding the hiatus around the referendum, reservations were down by a fifth on the same period last year. It attributed this to stamp duty and referendum uncertainty. Forward sales were £2.9bn, down from £3.2bn in the six months to April. The housebuilder also proposed a change to its shareholder returns programme, put in place in 2011, and the remaining £10 per share, which was enhanced from £13 to £16.34 last year. Berkeley is now proposing flexible share payments, through a combination of share buy-backs and dividends, as opposed to just dividends. The group said: “The board is of the opinion that the company is materially undervalued and share buy-backs will be in the best interests of all shareholders.” However, it still posted a rise in pretax profit of 33.9% to £392.7m, and a 24.1% rise in revenue to £1.4bn. It said it was on target to deliver a three-year pretax profit of £2bn from May 2015.    Chairman Tony Pidgley said “Strong forward sales, coupled with the resilient current market conditions, have enabled the board to announce a new five-year target to deliver at least £3bn of profit before tax in the five years beginning 1 May 2016.” He went on to say the group’s business model is unchanged and will focus on complex, long-term regeneration sites. Pidgley also raised concerns about London mayor Sadiq Khan’s affordable homes targets, saying there remains a tension in the planning system between this and the community infrastructure levy. “The new London mayor is bringing a refreshing focus to the capital’s housing challenge and we fully support his ambition to increase the supply of homes for everyone,” he said. • To send feedback, e-mail alex.peace@estatesgazette.com or tweet @EGAlexPeace or @estatesgazette