Profits at Abbey grow 60% in half year to end of October

PROFITS AT the house builder Abbey grew by 60 per cent to €5.55 million in the first half of its financial year, the company said yesterday.

Dublin and London-listed Abbey said that revenues were up by more than 14 per cent in the six months to October 31st, the first half of its financial year, at €41.7 million from €36.6 million during the same period last year.

Pre-tax profits grew by almost two-thirds to €5.55 million this year from €3.6 million in 2009.

Finance income of €1.2 million boosted this year’s first-half profits. The surplus from the group’s operations were up 43 per cent at €4.4 million from €2.5 million.

Chairman Charles Gallagher said Abbey sold 172 houses during the six-month period, 131 in Britain, 33 in Ireland and eight in the Czech Republic.

He described trading in Britain as “satisfactory”.

He said that the group made steady progress in Ireland despite difficult market conditions.

Abbey has started building the last phase of its development at Holywell, Kilcoole, Co Wicklow, where it cut prices earlier this year to boost sales.

In the Czech Republic, sales in Prague continue to be slow, while it is close to completing a development at Andel and is working on promoting sales there.

Abbey’s plant-hire business, MJ Engineers, made a profit of €165,000 during the first half of the financial year.

Mr Gallagher said that conditions in all its markets continued to be testing.

“As widely observed, autumn sales have been muted and as a result, our second-half outlook is more than usually dependent on a strong performance in the last quarter,” Mr Gallagher said.

He added that in general prices have fallen slightly in recent months.

The group had almost €45 million in cash at the end of the period, and held €55.27 million in British government debt.

It intends investing some of these funds in development sites as circumstances allow.

Abbey bought sites consisting of 255 plots with planning permission during the first half.

The board declared a dividend of 3 cent for the second half, which, if shareholders approve it, will bring the final dividend for the year to 8 cent.

Mr Gallagher described the outlook for the immediate future as “quite bleak” yesterday.

Banks are limiting lending to house buyers in all its markets, and it expects further constraints on credit in Britain as it unwinds emergency support measures for its banks.

Mr Gallagher pointed out that the group was trading profitably and was well positioned to take advantage of any upturn should it arrive.