PERFORMANCE
Profit before tax up 19.2% to £169.5 million (2012: £142.2 million)
Operating margin of 20.7% (2012: 21.3%)
Operating profit includes £29.6 million on disposal of 534 investment properties to M&G Investments
Pre-tax return on shareholders' equity of 25.0% (2012: 24.5%)
£278 million invested in land in the period acquiring a further 1,754 residential plots
Basic earnings per share increased by 22.0% to 100.0 pence (2012: 82.0 pence)
Interim dividend of 90 pence per share (2012: 15 pence per share) payable in January 2014
BALANCE SHEET
Cash due on forward sales increased by £293.0 million (20.2%) to £1,745.8 million (April 2013: £1,452.8 million)
Shareholders' equity up £69.0 million to £1,391.4 million (April 2013: £1,322.4 million)
Net asset value per share up 5.3% to 1,062 pence (April 2013: 1,009 pence)
Land holdings comprise 25,060 plots (April 2013: 25,684 plots) and a further 10,000 plots in the future pipeline
Future anticipated gross margin in the land holdings up 6.8% to £3,047 million (April 2013: £2,852 million)
Net cash of £78.9 million (April 2013: £44.7 million)
Commenting on the results, Chairman A. W. Pidgley said:
"I am delighted to report another period of strong performance. Basic earnings per share have increased by 22.0% to 100.0 pence per share and we have achieved our target of growing our land holdings to over £3 billion earlier than originally guided. This performance maintains the Board's view that Berkeley is on course to meet the first milestone payment of £568 million by September 2015 and to return £1.7 billion in cash to shareholders no later than September 2021.
The Board has declared a further interim dividend of 90 pence per share (£117.9 million), payable in January 2014, leaving a balance of 270 pence per share (£353.8 million) to be paid in order to meet the first milestone. This now places the Group firmly ahead of its original timetable and on target to reach the first milestone. Subject to prevailing market conditions, the Board intends to maintain a regular distribution of dividends in the period to September 2015.
The long-term challenge for the country is to deal with the significant housing shortfall which continues to grow. Over the last five years Berkeley has doubled the size of its business, investing over £1.5 billion into land and over £2.5 billion into build, sustaining 16,000 direct and indirect jobs each year and building over 15,000 homes of every tenure in vibrant new places. The Group is now delivering more new homes than immediately prior to the financial crisis in 2008 and is building on every one of its sites which has a viable planning consent and vacant possession. Berkeley has the capacity to invest further, which would create more homes and jobs, but is concerned by the increased uncertainty created by the ongoing debates surrounding the future of property taxation and international buyers.
Following nearly ten years of continuous service, David Howell has announced his intention to step down from the Board and each of the committees in which he is involved from the date of the next AGM in September 2014. With this in mind, I am delighted to announce that Andy Myers, Chief Financial Officer at McLaren Group, will join the Board from the date of this announcement as an independent non-executive director and will chair the Audit Committee with effect from the next AGM. With this appointment, the Board currently comprises a Chairman, five executive and seven non-executive directors.
Furthermore, the Board has today released a statement advising that it has undertaken a competitive tender process for the audit of Berkeley for the year ending 30 April 2014, and has resolved to appoint KPMG LLP. As auditor to the Group for some 30 years, PwC has been a professional, constructive and trusted advisor to the Company and the tender process was instigated to follow evolving best practice.
In closing, I would like to express my thanks to all the employees of Berkeley for their dedication and hard work. We have positioned Berkeley with a plan to deliver long-term sustainable success and are confident that we can achieve this, whilst remaining mindful of the risks of operating in a cyclical market which is sensitive to the uncertainty of political decision-making and the rhetoric of regulatory change."
