Buoyant Berkeley raises earnings expectations by 5%

Berkeley Group has raised earnings expectations, saying that full-year returns will be 5% higher than it previously stated. The group’s basic earnings per share for the past six months have risen by nearly 35% on last year’s figures. Announcing “a strong set” of half-year results, Berkeley said pretax profit had reached £290.7m, a 26% rise on the same period last year, equating to earnings per share of 201.7p. The pretax return on equity was 19.1%, up from 14.9%. Revenue was up 36% to £1.22bn. The developer previously said that earnings would be in line with last year. Now it expects shareholder earnings for the full year to be more than £625m, 5% higher than anticipated for the financial year. It added that it now expects pretax profits to grow by 5% each year for the next three years. Total shareholder returns for the six months, including dividends paid on B-share capital, were £486.2m, against £171m for the six months to 31 October 2020. The group said it was sticking to its long-term plan to return £282m a year to shareholders. The housing-led regeneration specialist has kept its landbank stable, at £6.9bn, while its net cash has shrunk over the six months from £1.13bn to £846m. Forward sales were also stable at £1.7bn. Berkeley said it had 25 of its 30 long-term complex regeneration developments in production, and had bought two new sites over the period in Peckham and Woolwich. By 2025 it expects a 50% increase in housing delivery from 2019’s level of around 4,000 homes.   To send feedback, e-mail piers.wehner@eg.co.uk or tweet @PiersWehner or @EGPropertyNews