Springfield beats own target for cutting debt
Scottish housebuilder Springfield Properties has cut its bank debt from £61.8m to £40m, going beyond a target of £55m, despite challenging conditions in the housing market.
In a trading update covering the year to 31 May, the company said it had cut the borrowing by selling land to accelerate cash realisation from its portfolio.
During the period, Springfield sold £28m-worth of land with no impact on its short-term development plans and maintained cost controls.
Scottish housebuilder Springfield Properties has cut its bank debt from £61.8m to £40m, going beyond a target of £55m, despite challenging conditions in the housing market.
In a trading update covering the year to 31 May, the company said it had cut the borrowing by selling land to accelerate cash realisation from its portfolio.
During the period, Springfield sold £28m-worth of land with no impact on its short-term development plans and maintained cost controls.
Chief executive Innes Smith said: “A key priority for the year was reducing our debt, and we’re pleased that we have exceeded our target. This was achieved through securing profitable land sales, which, alongside continued cost control, has enabled us to deliver better-than-expected profit.”
The company expects to report revenue of around £266m for the year, down from £332.1m for the previous year. Profit before tax is expected to slightly exceed market forecasts owing to strong profit from land sales.
Smith added: “Looking forward, we trust that the Scottish government will take action to address Scotland’s housing emergency, which must include the removal of the rent cap barriers to attract PRS investment north of the border.
“With one of the largest land banks in Scotland, and with a high proportion of sites already having planning in place, we are well-positioned to benefit from any resumption in PRS activity, which would represent an upside to our forecasts.”
Image from Springfield Properties
