Profits at homebuilder Abbey jump to €29.7m in first half
Home builder Abbey has reported strong first half results but warned that house construction in southern England is likely to experience tougher conditions compared to the strong trading to date there.
Pre-tax profits for the six months to the end of October jumped 74pc to €29.7m from €17m. Abbey, which is headed by executive chairman Charles Gallagher, also said that skills shortages are impacting its activities.
Abbey, which is listed on the Alternative Investment Market in London and the Enterprise Securities Market in Dublin, generates the bulk of its revenue in Britain. Turnover for the first half rose 54pc to €111.5m from €72.5m in the first six months of the previous financial year.
In the latest half, €11.3m of that was generated from Abbey's plant and machinery hire business in the UK, with €92.5m attributable to house construction there. Just €4.1m of revenue was generated in Ireland, and €3.4m in Czech Republic.
Abbey completed 294 sales in the period, 264 of them in the UK; 15 in Ireland; and 15 in Czech Republic. It made an €886,000 operating profit in Ireland, and €25.9m in the UK.
"Trading in the UK was buoyant during the period," Mr Gallagher said in a statement. "Good margins have been supported by strong prices and effective management of fast rising costs. Sales have continued at a good level into the second half."
He added that favourable weather conditions had helped activity, but warned that the final quarter of the financial year will be "critical" to the year's results.
"Skill shortages in all aspects of our business continue to impact our activities," said Mr Gallagher.
Abbey declared an interim dividend of 6 cents per share for the period.
In Ireland, Abbey said a project in Adamstown, Lucan, in west Dublin is selling well, while another project in Delgany, Co Wicklow, will launch next year. It operates under the Kingscroft Developments name in Ireland. In October, Kingscroft lost an appeal to An Bord Pleanála to be allowed to replace a derelict house on Dublin's Stillorgan Road with nine three-storey homes.
"The immediate outlook is good," said Mr Gallagher. "Sales across our business are firm. In the medium term the strong trading conditions being experienced in southern England will dissipate and we should expect tougher conditions ahead."