Profits at homebuilder Abbey down almost 40%

Profits at Dublin-listed homebuilder Abbey fell almost 40 per cent last year, the company's annual results show.

In its results for the year ended April 30th, 2020, which were published on Friday, Abbey said its profit for the year amounted to €33 million before tax against a profit of €53 million in the previous year.

After a tax charge of €6.5 million, the group made a profit of €26.5 million reflecting earnings per share of 125.62 cents. Group operating profits during the year were €32.7 million against €53 million the previous year.

Dividends of 11 cents per share absorbing €2.3 million were paid during the year.

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Abbey said its housebuilding operations completed 490 sales, including 405 in the UK; 57 in Ireland, and 28 in Czechia, with a turnover of €162.7 million generating an operating profit of €31.3 million.

Trading in the last quarter was “significantly impacted” by the Covid-19 crisis, it said. “In this context the overall results were satisfactory,” the company added.

In Ireland, the Abbey said it ended the year with a “strong forward sales position”. Sales completions will “rise significantly” this year.

“Work is well advanced on our two projects in Navan and another in Portlaoise,” it said. “Our substantial new project in Oranmore County Galway will be underway in the first half. Further projects are in the planning process.”

In the UK, production and sales activity resumed at reduced levels in May. Sales “held up well” supported by the Help to Buy programme.

“Margins overall are reasonable and forward orders are normal,” it said. “Production is steady but constrained by Covid regulations and some material supply interruptions. The UK land bank closed the year at just short of 1,800 plots.

“All new projects placed on hold are planned to start before the end of October. Budgeting this year is more than usually difficult and the delayed start to new projects will result in lower than previously planned completions.”

At the year end, the group owned and controlled land allocated for housing development for the supply of 2,947 plots. Rental income during the year was €1.1 million. A fair value adjustment loss of €200,000 was recorded in the year.

The group held €70.8 million in cash at the end of the financial year. On the balance sheet date commitments outstanding on land were €2.5 million.

Abbey said the Covid-19 pandemic had “undoubtedly been a severe blow to the economy and to our business”.

“The longer term impact is unclear,” it said. “Overall the group is fortunate to be in a healthy financial position and we hope with caution to add to our land bank in the months ahead.

“In the light of current events the board will not recommend a dividend at the annual general meeting.”