Development group hails economic recovery as revenues jump 49%

A STRONGER economic recovery has helped Henry Boot see profits climb and revenues rise.

It’s also resulted in the group announcing an “unprecedented” number of profitable land and property development sites to work on.

In its preliminary results to the end of December, the South Yorkshire-based construction and development group reported an increase in operating profit of 34% to £19m and a jump in pre-tax profits by 37% to £18.4m. Dividends for the year increased 8.5% to a record 5.1p and revenue increased by 49% to £153.8m.

Henry Boot’s chairman, John Brown, today said the benefits of the group’s “clear and consistent long-term strategy” has shone through in 2013.

“Henry Boot has performed very well in 2013 and I am really pleased to report on another year of strong progress across the businesses within the group,” Brown said.
 
“Our business model looks to parts of our business to generate relatively stable, recurring income flows (property investment and construction segment) and parts (land promotion and property development) that are cyclical, deal driven businesses which potentially offer increased returns for higher risk. We have invested more heavily in these higher risk businesses over the last three years with the result that, as we move into 2014, we have an unprecedented number of profitable land and property development sites to work on.”

The family firm has a number of divisions – Stonebridge, a residential property development specialist, Hallam Land Management, Henry Boot Constructions, Banner Plant and it also operates the A69 road between Newcastle and Carlisle. 

Henry Boot said its construction division has a good order base for 2014 and into 2015 and, after its best year since 2005, the firm said it is confident its plant hire business will have another good year in 2014.

Brown added: “The new financial year has started well and house builders reporting so far in 2014 are painting an encouraging picture of increasing activity, good land availability and slowly rising prices. Add to that a stronger market for new property development and improving construction and plant activity levels and, provided that these trends continue, we remain confident that we can perform well in 2014 and beyond.

“Economic recovery, particularly for the housing sector, is now well established, the debt and funding shackles have been relaxed, stronger economic recovery is supporting property development activity once again and these changes have a positive knock on effect in our construction and plant businesses.”

Looking ahead, the group said it is expecting to finalise terms for the majority of the residential scheme in the early part of this year at the former Terry’s Chocolate Factory in York, enabling that part of the development to proceed to site in the second half of the year. It also expects to finish the refurbishment of Park House – its serviced office in Leeds. It will be marketing the scheme to small businesses.