BOVIS HOMES GROUP PLC
HALF-YEARLY FINANCIAL REPORT
for the six
months ended
Issued
The Board of Bovis Homes Group PLC
today announces its interim results for 2009.
·
Revenue
of £122.6 million (2008 H1: £149.3 million)
·
Pre-exceptional
profit before tax of £1.2 million (2008 H1: £11.7 million)
·
Pre-exceptional
earnings per share of 0.4p (2008 H1: 7.1p)
·
Post-exceptional
loss before tax of £8.6 million (2008 H1: £9.5 million profit)
·
Pre-exceptional
gross margin of 16.2% (2008 H1: 26.3%) with pre-exceptional operating margin at
5.9% (2008 H1: 10.0%), reflecting the impact of falling average sales prices
over 2008
·
Successful
management of overhead costs, 48% lower than in H1 2008
·
7.5
years of consented land at
(31 December 2008: 13,545 plots)
·
Strategic
landholdings of 18,588 potential plots
(31 December 2008: 18,972 potential plots)
·
Limited
land write-downs of £8.9 million required as at
·
Good
progress in generating cash, with net cash inflow of £94 million
(2008 H1: £49 million outflow)
·
Net
debt before issue costs of £14 million and 2% gearing at
Commenting on the results, David Ritchie, Chief Executive of
Bovis Homes Group PLC said:
"The Group has made good progress
during the first half of 2009, with a 92% increase in the volume of private
home reservations. The Group achieved a
pre exceptional profit before tax for the half year, despite the adverse impact
from significantly lower home sales prices, as private legal completions grew
by 18% and overheads were successfully reduced by 48%.
Through good control of working
capital, the Group delivered a strong cash flow performance, generating £94
million of cash inflow and reducing net debt to £14 million at
Certain statements in this press release are forward looking
statements. Forward looking statements involve evaluating a number of
risks, uncertainties or assumptions that could cause actual results to differ
materially from those expressed or implied by those statements. Forward
looking statements regarding past trends, results or activities should not be
taken as a representation that such trends, results or activities will continue
in the future. Undue reliance should not be placed on forward looking
statements.
Enquiries:
Bovis Homes Group PLC Tel:
Tel:
Interim Management Report
During
the first six months of 2009, the Group has successfully generated significant
positive cashflows, sharply increased sales rates and effectively controlled
both direct and overhead costs: in line with the priorities set by the Group as
it entered the year.
The
Group’s net debt before issue costs fell from £108 million at
Given
the unprecedented market conditions in 2008, the Group took a range of decisive
steps to position itself to manage its balance sheet over the mid term in an
effective manner, so as to be able to take advantage of future investment
opportunities. These actions included
substantial reductions in headcount and overhead costs, tight control over work
in progress, near-cessation of land acquisition and the renegotiation of the
Group’s banking arrangements. The Group
also sought to improve its selling capability through a revision to its pricing
strategies and the restructuring of its sales operations with the introduction
of sales ‘hubs’ running multiple geographically proximate sales outlets. The Group’s first half performance has positively
reflected the outcomes of these actions.
Market conditions
The housing market has shown signs of stabilisation during
the first half of 2009, with external house price indices indicating that the
rate of price decline has lessened over this period and the number of mortgage
approvals for home purchase has increased, albeit from a low base. Notwithstanding this, transaction volumes
remained at historically low levels during this period and pricing remains
substantially below the peak levels of late 2007.
Whilst
this period of relative improvement has been welcomed, the Group remains
cautious in its expectations on pricing in the short term, given the continuing
challenges seen both in terms of mortgage availability and in terms of the
approach taken by surveyors in arriving at mortgage valuations. There also remains concern about the possible
impact on house prices from rising unemployment and from a potential increase
in supply of properties for sale in the second hand market.
Income statement
The Group generated £122.6 million of revenue in the first
half of 2009, a fall of 18% versus the comparable period (2008: £149.3
million). Within this, housing revenue
fell by 16% from £142.6 million in 2008 to £120.4 million in 2009. The Group chose not to sell any development
land during the first half of 2009 (2008: Land sales revenue of £4.9
million). Other revenue totalled £2.2
million in 2009 versus £1.8 million in 2008.
The Group legally completed 754 homes in the first half of 2009 (2008: 851
homes). Of these, 738 homes or 98% were
private, an 18% increase on the comparable number in 2008 (624 homes or
73%). The Group delivered 16 (2%) social
homes in the first half of 2009, as expected a much lower number versus 227 (27%)
social homes in the first half of 2008.
For private homes legally completed in the first half, the
Group achieved an average net sales price of £160,400, as compared to £196,700
in the first six months of 2008 and £164,700 in the second half of 2008,
reflecting house price reductions in the market. Overall, including social and partnership
homes, the average sales price achieved by the Group for the six months ended
The average size of private homes legally completed during
the first half was 996 square feet, as compared to 964 square feet in the first
half of 2008 and 980 square feet in the second half of 2008. Adjusting for this size difference, the
average sales price per square foot for private homes was £161 in the first half
of 2009, as compared to £204 in the first half of 2008 and £168 in the second
half of 2008. As private pricing in the first
half of 2008 was at its peak on a per square foot pricing basis for the Group,
the performance in 2009 reflects an approximate 21% fall from this peak. Pricing
in the first half of 2009 was 4% below that achieved in the second half of
2008.
With no land sales in the first half of 2009, the Group incurred a net cost
from option fee amortisation of £0.5 million in the first half, as compared to land
sale profits, less option costs, of £2.1 million in the first half of 2008.
The lower average private sales price achieved led to a fall
in the Group’s private housing gross margin against the comparable period last
year. As the Group has been selling, in
the main, advanced build stock, the income statement benefit from reductions in
construction costs has to date been limited.
Accordingly, the Group saw its pre-exceptional gross profit margin fall
by c10 ppts: from 26.3% in H1 2008 to 16.2% in H1 2009.
Actions taken by the Group during 2008 to reduce its
overheads are now generating the expected level of saving. Overheads in the first six months of 2009
were £12.6 million, some 48% lower than the overhead in the first half of 2008,
representing 10.3% of revenue versus 16.3% in the first half of 2008. This has partially offset the fall in gross
profit margin, and provides the Group with a 5.9% pre-exceptional operating margin
for the first half of 2009 as compared to 10.0% in 2008 in the same period.
At each period end, the Group is required to assess the carrying value of its
inventory. Based on current estimates of
achievable prices in the market, there were a small number of specific sites
where a write-down was required at the half year, totalling £8.9 million. This represented c2% of the value of the land
bank. In total to date the Group has now
taken inventory write-downs amounting to c14% of its landbank value. A further £0.9 million was also provided
against potentially onerous contracts for land transactions conditional on
achieving acceptable planning consents. In
total, the Group has taken exceptional charges of £9.8 million in the first
half of 2009. In the first half of 2008
the Group incurred an exceptional charge of £2.2 million linked to
restructuring.
For the six months ended
Dividends
Given the importance of retaining the financial capacity to
take full advantage of the opportunity to invest in the residential land market
at attractive values, and having regard to the likely level of profitability during
2009, the Board does not intend to declare an interim dividend for 2009.
Cashflow and net debt
As at
The Group now anticipates being cash positive at the end of
2009 as the Group continues to reduce work in progress levels. This assumes that the Group does not make
significant cash expenditure on new land opportunities during the second half
of 2009, beyond its previous guidance.
There are an increasing number of land opportunities currently being
assessed by the Group which may be acquired during 2009. The Group will, however, seek to manage
cashflows associated with such acquisitions such that cash expenditure can be spread
over a period of time.
The first
half average borrowing position gave rise to total financing charges of £6.0
million, substantially higher than the comparable period at £3.2 million. Of this total financing charge, bank interest
expenses were £3.1 million (2008: £2.4 million) reflecting a higher interest
rate arising from the 2008 refinancing.
The Group amortised £2.0 million of the issue costs relating to the 2008
refinancing and charged £0.9 million (2008: £0.8 million) arising from a number
of non-cash technical interest items, including imputed interest expenses arising
from land creditors and pension financing interest income.
Land
The Group’s controlled and consented landbank reduced from
13,545 plots at the end of 2008 to 12,851 plots at the end of June 2009. This represented 7.5 years of supply at
current levels of legal completions. The
strategic land bank at
Pensions
As at
Principal risks and uncertainties
In a
manner consistent with the Disclosure and Transparency Rules, the Board has
formally identified a number of principal risks and uncertainties that may
impact the business, reporting on these in full in its 2008 Annual report and
accounts. The purpose of doing so is to
ensure that the Group is able to arrange its affairs such that it can avoid the
risk or mitigate the impact of the risk occurring. A number of these risks relate to the Group’s
day to day operations, such as the risk of accidents occurring as a result of
breaches of health and safety standards or of environmental damage arising.
Other risks and uncertainties are inherent in the activity of speculative
housebuilding and are principally commercial in nature. During the worsening trading environment
during 2008, the Group reviewed and reassessed the likelihood and impact of
risk occurring in this changing business environment. Having done so, the Group identified that the
principal commercial risks of the business fell into a number of categories, principally
market driven risks around the ability to deliver sales pricing and sales
volume, legislative risks posed by planning and legislative changes, liquidity
risks given the difficulties in financial markets and finally organisational
risks given the stresses of operating in tough markets with downsized teams.
Given the actual cashflow performance of the Group over the last six months,
together with the Group’s expectations of performance in the next six months, the
risks to the Group from tight liquidity in the short term have lessened. This said, there is little sign that credit
availability has eased in general and the Group’s current banking agreement
expires in March 2011, hence this remains an area of focus for the Group.
From the perspective of marketplace risk, mortgage availability has improved
during the first half of 2009, and pricing declines appear to have stabilised
but substantial uncertainties remain over the direction and scale of price
movements as well as in regard to the ability of the current mortgage market to
fund transactions at levels previously regarded as the ‘norm’.
Whilst risks around liquidity and the marketplace have reduced in the recent
past, the Group remains vigilant in terms of its organisational effectiveness,
as workloads remain high, with additional activities such as re-planning
consuming management time.
Current clarification by Government in regards to the Code for Sustainable
Homes and more generally the sustainability agenda has been helpful in reducing
uncertainty relating to legislative risks. However, the possibility of a change
in Government at the next election, with differing views at present on future
planning processes, does continue to pose potential risks and opportunities
that will need to be assessed and, where possible, managed.
Cumulative reservations
The Group achieved 901 net private reservations in the six
months since
Cumulative sales achieved to
Prospects
Cumulative sales achieved to
Looking to the full year, the Group’s sales performance to
date supports the Group’s existing guidance on anticipated 2009 volumes of
circa 1,800 legal completions. The Group
continues to anticipate legally completing only circa 300 social homes in 2009
compared to 594 social homes in 2008.
This suggests a private legal completion volume of circa 1,500 homes,
circa 25% ahead of the 1,223 private legal completions achieved in 2008. This guidance assumes sales rates will
continue at or around current levels for the remaining sales weeks of 2009,
after the Group’s experience of a modestly slower summer sales period.
The Group has positioned itself well to trade through the
current downturn and continues to benefit from its longstanding prudence in the
consented land market and the relatively high proportion of its land supply
sourced strategically. 2009 will be a year
of delivering strong positive cash flow, repositioning the Group’s balance
sheet with lower work in progress and anticipated net cash in hand at the year
end. The Group is also now operating
with a sustainable reduced overhead base which allows the achievement of
trading profits despite relatively low levels of revenue. These positive attributes make Bovis Homes an
attractive potential buyer when considering relative capabilities to invest in
cost effective consented residential land opportunities and in doing so to
generate attractive returns.
The
short term outlook for the housing market is a continuation of relatively low
levels of activity constrained by ongoing illiquidity in the mortgage
market. House prices appear to be
demonstrating a degree of stability at present, aided by the current low level
of second hand homes being offered for sale across the housing market. With improved home affordability and growing
consumer confidence, homebuyer activity will in time increase creating an
improvement in demand for the Group’s homes.
Chairman
Bovis Homes Group PLC
Group income statement
|
For the six months
ended (unaudited) |
Six months ended |
Six months ended |
Year ended |
|||||||||||||||
|
|
Before exceptional
items |
|
Exceptional items |
|
Total |
|
Before exceptional items |
|
Exceptional items |
|
Total |
|
Before exceptional items |
|
Exceptional items |
|
Total |
|
|
|
£000 |
|
£000 |
|
£000 |
|
£000 |
|
£000 |
|
£000 |
|
£000 |
|
£000 |
|
£000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
122,611 |
|
- |
|
122,611 |
|
149,288 |
|
- |
|
149,288 |
|
282,326 |
|
- |
|
282,326 |
|
|
Cost of sales |
(102,849 |
) |
(9,843 |
) |
(112,692 |
) |
(109,965 |
) |
- |
|
(109,965 |
) |
(219,011 |
) |
(76,487 |
) |
(295,498 |
) |
|
Gross profit/(loss) |
19,762 |
|
(9,843 |
) |
9,919 |
|
39,323 |
|
- |
|
39,323 |
|
63,315 |
|
(76,487 |
) |
(13,172 |
) |
|
Administrative expenses |
(12,582 |
) |
- |
|
(12,582 |
) |
(24,356 |
) |
(2,248 |
) |
(26,604 |
) |
(42,018 |
) |
(16,641 |
) |
(58,659 |
) |
|
Operating profit/(loss) before financing costs |
7,180 |
|
(9,843 |
) |
(2,663 |
) |
14,967 |
|
(2,248 |
) |
12,719 |
|
21,297 |
|
(93,128 |
) |
(71,831 |
) |
|
Financial income |
764 |
|
- |
|
764 |
|
608 |
|
- |
|
608 |
|
1,389 |
|
- |
|
1,389 |
|
|
Financial expenses |
(6,708 |
) |
- |
|
(6,708 |
) |
(3,823 |
) |
- |
|
(3,823 |
) |
(8,292 |
) |
- |
|
(8,292 |
) |
|
Net financing costs |
(5,944 |
) |
- |
|
(5,944 |
) |
(3,215 |
) |
- |
|
(3,215 |
) |
(6,903 |
) |
- |
|
(6,903 |
) |
|
Profit/(loss) before tax |
1,236 |
|
(9,843 |
) |
(8,607 |
) |
11,752 |
|
(2,248 |
) |
9,504 |
|
14,394 |
|
(93,128 |
) |
(78,734 |
) |
|
Income tax (expense)/credit |
(725 |
) |
2,756 |
|
2,031 |
|
(3,245 |
) |
629 |
|
(2,616 |
) |
(3,319 |
) |
23,058 |
|
19,739 |
|
|
Profit/(loss) for the period attributable to equity holders of the parent |
511 |
|
(7,087 |
) |
(6,576 |
) |
8,507 |
|
(1,619 |
) |
6,888 |
|
11,075 |
|
(70,070 |
) |
(58,995 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings/(loss) per share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic |
0.4p |
|
(5.9p |
) |
(5.5p |
) |
7.1p |
|
(1.4p |
) |
5.7p |
|
9.2p |
|
(58.3p |
) |
(49.1p |
) |
|
Diluted |
0.4p |
|
(5.9p |
) |
(5.5p |
) |
7.1p |
|
(1.4p |
) |
5.7p |
|
9.2p |
|
(58.3p |
) |
(49.1p |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividend per share charged in period |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2008 interim paid November 2008 |
|
|
|
|
- |
|
|
|
|
|
- |
|
|
|
|
|
5.0p |
|
|
2007 final paid May 2008 |
|
|
|
|
- |
|
|
|
|
|
17.5p |
|
|
|
|
|
17.5p |
|
|
|
|
|
|
|
- |
|
|
|
|
|
17.5p |
|
|
|
|
|
22.5p |
|
Bovis Homes Group PLC
Group statement of comprehensive income
|
For the six months
ended |
Six
months ended |
|
Six
months ended |
|
Year
ended |
|
|
|
|
|
|
|
|
|
|
|
£000 |
|
£000 |
|
£000 |
|
|
|
|
|
|
|
|
|
|
Revaluation of available for sale
financial assets |
- |
|
(17 |
) |
- |
|
|
Deferred tax on revaluation of
available for sale financial assets |
- |
|
5 |
|
- |
|
|
Actuarial losses on defined
benefit pension scheme |
(4,400 |
) |
(3,100 |
) |
(8,820 |
) |
|
Deferred tax on actuarial
movements on defined benefit pension scheme |
1,232 |
|
868 |
|
2,470 |
|
|
Current tax on share based
payments recognised directly in equity |
- |
|
- |
|
498 |
|
|
Deferred tax on other employee
benefits |
(19 |
) |
(402 |
) |
(22 |
) |
|
Other comprehensive expenses for
the period net of tax |
(3,187 |
) |
(2,646 |
) |
(5,874 |
) |
|
(Loss)/profit for the period |
(6,576 |
) |
6,888 |
|
(58,995 |
) |
|
Total comprehensive (expense)/income for the period attributable to
equity holders of the parent |
(9,763 |
) |
4,242 |
|
(64,869 |
) |
Bovis Homes Group PLC
Group balance sheet
|
At |
|
|
|
|
|
|
|
|
£000 |
|
£000 |
|
£000 |
|
|
|
|
|
|
|
|
|
|
Assets |
|
|
|
|
|
|
|
Goodwill |
- |
|
9,176 |
|
- |
|
|
Property, plant and equipment |
11,895 |
|
13,915 |
|
12,347 |
|
|
Available for sale financial
assets |
13,989 |
|
3,789 |
|
6,030 |
|
|
Investments |
22 |
|
22 |
|
22 |
|
|
Deferred tax assets |
9,028 |
|
3,761 |
|
5,548 |
|
|
Trade and other receivables |
2,343 |
|
6,222 |
|
2,418 |
|
|
Total non-current assets |
37,277 |
|
36,885 |
|
26,365 |
|
|
Inventories |
689,490 |
|
887,893 |
|
780,808 |
|
|
Trade and other receivables |
25,808 |
|
34,082 |
|
37,947 |
|
|
Cash |
4,791 |
|
4,006 |
|
11,634 |
|
|
Current tax asset |
859 |
|
- |
|
23,550 |
|
|
Total current assets |
720,948 |
|
925,981 |
|
853,939 |
|
|
Total assets |
758,225 |
|
962,866 |
|
880,304 |
|
|
|
|
|
|
|
|
|
|
Equity |
|
|
|
|
|
|
|
Issued capital |
60,514 |
|
60,482 |
|
60,497 |
|
|
Share premium |
157,228 |
|
157,054 |
|
157,127 |
|
|
Retained earnings |
404,988 |
|
489,403 |
|
414,654 |
|
|
Total equity attributable to equity holders of the parent |
622,730 |
|
706,939 |
|
632,278 |
|
|
|
|
|
|
|
|
|
|
Liabilities |
|
|
|
|
|
|
|
Bank loans |
12,797 |
|
25,000 |
|
111,730 |
|
|
Trade and other payables |
28,490 |
|
28,891 |
|
24,907 |
|
|
Retirement benefit obligations |
11,050 |
|
1,530 |
|
6,790 |
|
|
Provisions |
1,950 |
|
562 |
|
1,623 |
|
|
Total non-current liabilities |
54,287 |
|
55,983 |
|
145,050 |
|
|
Bank overdraft |
- |
|
1,015 |
|
- |
|
|
Bank loans |
- |
|
71,383 |
|
- |
|
|
Trade and other payables |
79,661 |
|
125,353 |
|
101,964 |
|
|
Provisions |
1,547 |
|
728 |
|
1,012 |
|
|
Current tax liabilities |
- |
|
1,465 |
|
- |
|
|
Total current liabilities |
81,208 |
|
199,944 |
|
102,976 |
|
|
Total liabilities |
135,495 |
|
255,927 |
|
248,026 |
|
|
|
|
|
|
|
|
|
|
Total equity and liabilities |
758,225 |
|
962,866 |
|
880,304 |
|
These condensed consolidated interim financial statements were
approved by the Board of directors on
Bovis
Homes Group PLC
Group statement of changes in equity
|
For the six months ended 30 June |
Total |
|
Issued |
Share |
Total |
|
|
(unaudited) |
retained |
|
capital |
premium |
|
|
|
|
earnings |
|
|
|
|
|
|
|
£000 |
|
£000 |
£000 |
£000 |
|
|
Balance
at |
506,594 |
|
60,415 |
156,734 |
723,743 |
|
|
Total
recognised income and expense |
4,242 |
|
- |
- |
4,242 |
|
|
Issue of
share capital |
- |
|
67 |
320 |
387 |
|
|
Share
based payments |
(402 |
) |
- |
- |
(402 |
) |
|
Dividends
paid to shareholders |
(21,031 |
) |
- |
- |
(21,031 |
) |
|
Balance at |
489,403 |
|
60,482 |
157,054 |
706,939 |
|
|
Balance
at |
506,594 |
|
60,415 |
156,734 |
723,743 |
|
|
Total
recognised income and expense |
(64,869 |
) |
- |
- |
(64,869 |
) |
|
Issue of
share capital |
- |
|
82 |
393 |
475 |
|
|
Share
based payments |
(22 |
) |
- |
- |
(22 |
) |
|
Dividends
paid to shareholders |
(27,049 |
) |
- |
- |
(27,049 |
) |
|
Balance at |
414,654 |
|
60,497 |
157,127 |
632,278 |
|
|
Balance
at |
414,654 |
|
60,497 |
157,127 |
632,278 |
|
|
Total
recognised income and expense |
(9,763 |
) |
- |
- |
(9,763 |
) |
|
Issue of
share capital |
- |
|
17 |
101 |
118 |
|
|
Share
based payments |
97 |
|
- |
- |
97 |
|
|
Balance at |
404,988 |
|
60,514 |
157,228 |
622,730 |
|
Bovis
Homes Group PLC
Group statement of cash flows
|
For the six months
ended |
Six
months ended |
|
Six
months ended |
|
Year
ended |
|
|
|
|
|
|
|
|
|
|
|
£000 |
|
Restated £000 |
|
£000 |
|
|
|
|
|
|
|
|
|
|
Cash flows from operating activities |
|
|
|
|
|
|
|
(Loss)/profit for the period |
(6,576 |
) |
6,888 |
|
(58,995 |
) |
|
Depreciation |
420 |
|
644 |
|
1,168 |
|
|
Impairment of goodwill |
- |
|
- |
|
10,036 |
|
|
Impairment of assets |
- |
|
- |
|
2,241 |
|
|
Financial income |
(764 |
) |
(608 |
) |
(1,389 |
) |
|
Financial expense |
6,708 |
|
3,823 |
|
8,292 |
|
|
Profit on sale of property, plant
and equipment |
(10 |
) |
(33 |
) |
(146 |
) |
|
Equity-settled share-based payment
expense/(credit) |
97 |
|
(402 |
) |
(22 |
) |
|
Income tax (credit)/expense |
(2,031 |
) |
2,616 |
|
(19,739 |
) |
|
Write-down of inventories |
8,895 |
|
- |
|
75,202 |
|
|
Operating profit before changes in working capital and provisions |
6,739 |
|
12,928 |
|
16,648 |
|
|
|
|
|
|
|
|
|
|
Decrease in trade and other
receivables |
4,366 |
|
12,289 |
|
8,924 |
|
|
Decrease/(increase) in inventories |
82,422 |
|
(17,341 |
) |
13,345 |
|
|
Decrease in trade and other
payables |
(19,210 |
) |
(18,206 |
) |
(43,444 |
) |
|
Increase/(decrease) in provisions and
employee benefits |
852 |
|
(673 |
) |
702 |
|
|
Cash generated from operations |
75,169 |
|
(11,003 |
) |
(3,825 |
) |
|
|
|
|
|
|
|
|
|
Interest paid |
(4,154 |
) |
(2,564 |
) |
(8,769 |
) |
|
Income taxes received/(paid) |
22,460 |
|
(14,942 |
) |
(16,924 |
) |
|
Net cash from operating activities |
93,475 |
|
(28,509 |
) |
(29,518 |
) |
|
|
|
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
|
|
|
Interest received |
522 |
|
78 |
|
187 |
|
|
Acquisition of property, plant and
equipment |
(15 |
) |
(143 |
) |
(143 |
) |
|
Proceeds from sale of plant and
equipment |
57 |
|
68 |
|
214 |
|
|
Net cash from investing activities |
564 |
|
3 |
|
258 |
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
|
|
|
Dividends paid |
- |
|
(21,031 |
) |
(27,049 |
) |
|
Proceeds from the issue of share
capital |
118 |
|
387 |
|
475 |
|
|
(Repayment)/drawdown of borrowings |
(101,000 |
) |
55,383 |
|
79,000 |
|
|
Costs associated with refinancing |
- |
|
- |
|
(8,290 |
) |
|
Net cash from financing activities |
(100,882 |
) |
34,739 |
|
44,136 |
|
|
|
|
|
|
|
|
|
|
Net (decrease)/increase in cash and cash equivalents |
(6,843 |
) |
6,233 |
|
14,876 |
|
|
Cash and cash equivalents at the
start of period |
11,634 |
|
(3,242 |
) |
(3,242 |
) |
|
Cash and cash equivalents at the end of period |
4,791 |
|
2,991 |
|
11,634 |
|
Notes to the accounts
1 Basis of
preparation
Bovis Homes Group PLC (‘the
Company’) is a company domiciled in the
The condensed consolidated interim
financial statements were authorised for issue by the directors on
The condensed interim financial statements do not constitute statutory accounts within the
meaning of Section 434 of the Companies Act 2006. The figures for the half years ended
The preparation of a condensed set of financial statements requires management
to make judgements, estimates and assumptions that affect the application of
accounting policies and the reported amount of assets, liabilities, income and expenses. Actual results may differ from these
estimates.
Judgements made by management in the application of adopted
IFRSs that have significant effect on the financial statements and estimates
with a significant risk of material adjustment in following years remain those
published in the Company’s consolidated financial statements for the year ended
The condensed interim financial statements have been prepared in accordance with IAS34
‘Interim Financial Reporting’ as endorsed by the EU. As required by the Disclosure and
Transparency Rules of the Financial Services Authority, the condensed
consolidated interim financial statements have been prepared applying the
accounting policies and presentation that were applied in the preparation of
the Company’s published consolidated financial statements for the year ended 31
December 2008, which were prepared in accordance with IFRSs as adopted by the
EU.
The following new standards, amendments to standards or
interpretations are mandatory for the first time for the Company’s year ending
IAS1 (2007) - Presentation of financial statements. This relates to the presentation of financial
statements and in particular the presentation of a statement of changes in
equity as a primary statement.
Previously this statement was disclosed as a note to the accounts.
IFRS8 – Operating segments. This relates to the degree to which financial
information is disaggregated in published financial information to aid the
reader in a better understanding of the performance of the Group. The Group’s main operation remains that of a
housebuilder operating entirely within
IAS23 - (Amended) Borrowing costs. This
amendment requires an entity to capitalise borrowing costs directly
attributable to the acquisition, construction and production of a qualifying asset,
as part of the cost of that asset. A
qualifying asset is one that takes a substantial period of time to get ready
for use or sale. Inventories which are
produced in large quantities on a repetitive basis over a short period of time
are not qualifying assets. This
amendment is not expected to have any material impact on the Group’s financial
statements as the activities performed by the Group do not generally produce qualifying
assets.
Notes to the accounts continued
The cashflow statement for the first six months to
2 Seasonality
In common with the rest of the
3 Exceptional
items
The Group has reviewed the carrying costs of its inventory
items, comparing the carrying cost of the asset against estimates of net
realisable value. Net realisable value has
been arrived at using the Board’s estimates of achievable selling prices taking
into account current market conditions, and after deduction of an appropriate
amount for selling costs. This has given
rise to a land write-down of £8.9 million.
The Group has made a further £0.9 million provision for potential
onerous land contracts. In total, this
represents £9.8 million of exceptional charges (six months ended
4 Loss
per share
Basic loss per share
Basic loss per ordinary share for the six months ended 30 June 2009 is
calculated on a loss after tax of £6,576,000 (six months ended 30 June 2008:
profit after tax of £6,888,000; year ended 31 December 2008: loss after tax of
£58,995,000) over the weighted average of 120,376,631 (six months ended 30 June
2008: 120,194,838; year ended 31 December 2008: 120,268,986) ordinary shares in
issue during the period.
Basic earnings per ordinary share before exceptional items for the six months ended
30 June 2009 is calculated on the pre-exceptional profit after tax of £511,000
(six months ended 30 June 2008: profit after tax of £8,507,000; year ended 31
December 2008: profit after tax of £11,075,000). Basic loss per share on exceptional items for
the six months ended 30 June 2009 is calculated on the exceptional loss after
tax of £7,087,000 (six months ended 30 June 2008: exceptional loss after tax of
£1,619,000; year ended 31 December 2008: exceptional loss after tax of
£70,070,000). In all cases this is
expressed on a per share basis using the weighted average share information
disclosed above.
Diluted loss per share
Under normal circumstances, the average number of shares is
diluted by reference to the average number of potential ordinary shares held
under option during the period. This
dilutive effect amounts to the number of ordinary shares which would be
purchased using the aggregate difference in value between the market value of
shares and the share option exercise price.
The market value of shares has been calculated using the average
ordinary share price during the period.
Only share options which have met their cumulative performance criteria
have been included in the dilution calculation.
The Group’s diluted weighted average ordinary shares potentially in
issue during the six months ended 30 June 2009 was 120,392,032 (six months
ended 30 June 2008: 120,298,768; year ended 31 December 2008: 120,314,451).
Notes to the accounts continued
As a loss per share cannot be reduced through dilution, this dilution
adjustment has been applied to the calculation of diluted earnings per share
before exceptional items for the six months ended 30 June 2009, the six months
ended 30 June 2008 and the year ended 31 December 2008 and to the calculation
of diluted earnings per share for the six months ended 30 June 2008. It has not been applied to the calculation of
diluted loss per share for the six months ended
5 Dividends
The following dividends per
qualifying ordinary share were paid by the Group:
|
(unaudited) |
Six
months ended |
|
Six
months ended |
|
Year
ended |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
May 2009: nil (May 2008: 17.5p) |
- |
|
21,031 |