Abbey plc: New Homes, Property Developers, Construction, Builders

Preliminary Results

ABBEY PLC
Preliminary Statement for the year ended 30 April 2017

The Group reports a profit of €63.5 million before taxation against a profit of €61.5 million in the previous year. After a tax charge of €11.6 million the Group made a profit of €51.8 million reflecting earnings per share of 241.04 cents. Group operating profits during the year were €60.8 million against €60.8 million the previous year.

Dividends of 15 cents per share absorbing €3.2 million were paid during the year.

Our housebuilding operations completed 586 sales (UK 495; Ireland 39, CZK 52) with a turnover of €196.5 million generating an operating profit of €57.1 million. Our UK housebuilding business experienced, overall, another good year. Sales, underpinned by the UK ‘Help to Buy’ scheme, were steady throughout the period. Strong margins were maintained as improving sales prices at least matched steadily rising costs. Forward sales entering the new financial year were at good levels although recent weeks have been quieter as political events together with normal seasonal trends have modestly dampened activity. Production is under pressure to keep up with our build targets. Tight markets for labour and some materials are now a significant constraint on driving output. During the year our UK landbank grew to in excess of 2,000 plots. The expansion of our land stocks should help us achieve our goal of increasing activity in the years ahead. In Ireland our projects in Delgany and Ratoath have both performed well. Next year should see another jump in activity as projects in Cabinteely, County Dublin and Dunshaughlin, County Meath contribute to our sales. ‘Help to Buy’ has significantly boosted confidence and is speeding the recovery in activity in the wider Dublin metropolitan area. This should in due course help ease the widely reported housing shortage in Dublin. Since the year end land for 46 houses has been purchased in Navan. In Prague we completed 52 sales. Our project Na Vidouli proved very popular. Work is continuing in Tetinska and Prezletice.

At the year end the Group owned and controlled land allocated for housing development for the supply of 3,047 plots.

M & J reported operating profits of €2.7 million on a turnover of €19.0 million. Overall trading has been steady however rising costs have squeezed margins. Trading in the early part of the new year has been consistent and another fair year is in prospect.

Rental income during the year was €973,000.

The Group held €95.1 million in cash at the end of the financial year. On the balance sheet date current liabilities stood at €76.7 million a substantial increase on a year ago. The increase is mainly accounted for by outstanding payments due on land purchases.

The Group has started the new year trading well from a platform that should allow more new homes to be delivered in both the UK and Ireland. UK margins continue to be good, however, subject to market conditions we are anticipating some erosion towards more normal levels. The economic and political background against which we operate is complex. There are increasing signs of a potential slowdown in the UK economy with an inevitably damaging impact on our business. This may be especially marked after the benign conditions experienced in recent years. In Ireland a strongly positive outlook may be impaired by further unwise intervention in the housing market. Looming ahead is the conclusion of the Brexit negotiations to which a good outcome is not assured. In spite of this uncertainty, and underpinned by a strong balance sheet, the Group is planning a year of growth with both the support of, and hopefully benefit to, all our stakeholders.

The Board is pleased to recommend a dividend of 9 cents per share for approval at the Annual General Meeting.

Shareholders should carefully note the exchange rates used for this statement. The income statement uses the average exchange rate for the year of 100 cents: STG 84.64p and 100 cents: CZK 27.02. The balance sheet uses the ratio prevailing on 30 April 2017 of 100 cents: STG 84.17p and 100 cents: CZK 26.84.

On behalf of the Board
CHARLES H GALLAGHER
EXECUTIVE CHAIRMAN
11th July 2017

Contact:
Davy Corporate Finance (Nominated Adviser and ESM Adviser)
Brian Garrahy
Tel:+ 353 1 679 6363

The Preliminary Results financial statements for the year ended 30 April 2017 can be accessed by clicking on the link below:

Abbey plc Prelim 30.04.2017 Financials

The Directors’ Report and Group Financial Statements for the year ended 30 April 2017 can be accessed by clicking on the link below:

ABBEY PLC R&A 30.04.2017