Housebuilder Abbey flags ‘moderate’ decline in sales

Operating profits to be ‘in the region of’ last year’s result

Abbey completed 586 home sales during the year. Photograph: iStock

Abbey completed 586 home sales during the year. Photograph: iStock

 

Dublin-listed housebuilder Abbey said on Friday that its turnover for the year to the end of April has come in “moderately short” of the €220 million posted for the previous year.

However, the outlook suggests that analysts may have to increase their forecasts. The consensus estimate in the market had been that sales would fall by almost 7 per cent to €205 million.

In a brief statement issued through the Irish Stock Exchange, the company said it completed 586 home sales during the year, including 495 units in the UK, 52 in the Czech Republic and 39 in Ireland.

Average sale prices

“Higher average sale prices and continued strong margins mean operating profit should be in the region of last year’s levels,” it said.

Colin Sheridan, an analyst with stockbrokers Davy, said: “While volumes at Abbey for the full year are slightly behind our forecasts, a higher ASP (average sale price) has delivered revenue broadly in line with our estimates.”

He added that his current operating profit estimate for Abbey, at €49.4 million, is now “too conservative, and a figure closer to €60 millino is likely”.

Abbey said that its forward sales acrss the group were at “good levels, and both the UK and Ireland are planning to build and sell more new homes in the year ahead.”

The cash-rich company is almost 82 per cent owned by chairman Charles Gallagher and his family through their investment vehicle Gallagher Holdings. They increased their position in January of this year from 76.7 per cent.

The Gallaghers made a mandatory takeover bid – priced at €145 million – for the entire company in 2012 after breaching the 50 per cent mark. By the time the offer period ended that September, the family owned almost 73 per cent of company.

Abbey said it would publish its full results in mid-July.

While the company did not provide any details of its balance sheet on Friday, Davy estimates that it ended the financil year with a net cash position of €101 million.