Profits up at building firm Abbey

PROFITS AT housebuilder Abbey rose 5 per cent to €12 million, but the company had to write more than €1 million off the value of its Irish assets.

Abbey said yesterday that profits before tax in the 12 months ended April 30th last – its last financial year – rose to €12.1 million from €11.5 million in 2011.

Operating profits dipped 3 per cent to €9.1 million from €9.4 million. Its results included a €1.3 million writedown in the value of property and work in progress in its Irish division, a result of the ongoing difficulties in the market here.

Publicly quoted Abbey specialises in housebuilding and has operations in the Republic, where it has sites in Wicklow and Laois, the south of England and the Czech Republic.

The group sold 310 houses last year, 255 in England, 37 in Ireland and 18 in the Czech Republic. The sales generated a turnover of €57.8 million and an operating profit from this division of €8.3 million.

The company’s statement said it had made considerable progress in clearing stock.

“Our project in Kilcoole has sold steadily and will probably be concluded this year.

“In Laois the lack of mortgages has meant we have chosen to rent a significant number of properties pending their sale,” Abbey said.

Chairman Charles Gallagher acknowledged yesterday conditions were difficult in all the group’s markets. He said that as well as selling homes in the Republic, it has also begun renting properties. “We’re getting good rents,” he added.

Mr Gallagher said its business in England was benefiting from some “spillover” from the London property market, which is one of Europe’s strongest, but he noted that conditions there were also slow. “It’s steady and I think we have held up reasonably well in the circumstances,” he said.

Abbey’s business in the Czech Republic is located in Prague. Mr Gallagher pointed out that, while it is outside the euro zone, banks there are similarly cautious.

Its plant hire business, M J, reported operating profits of €302,000 on a turnover of €12 million, a similar result to 2011. Improved trading in recent weeks has prompted Abbey to budget for a stronger contribution from this division in 2013.

Abbey held €20.2 million in cash and €50 million in UK government bonds at the end of April.

During the year, the company bought almost €1.4 million worth of shares, which it cancelled, back from shareholders for €7.3 million. Shareholders gave it the authority to do this at an extraordinary general meeting in November 2010. It paid dividends of 8 cent a share during the 2012 financial year.