Strong performance for Glenveagh despite shutdown

Home-builder Glenveagh Properties said it put in a strong performance in 2021 despite the shut down earlier in the year, with revenue rising to €476 million.

In a trading update for the year ended December 31st, 2021, the company said it closed 1,150 homes in the year, increasing revenue 36 per cent on pre-pandemic figures and 64 per cent compared to 2020.

Core revenue generated totalled €402 million, primarily from 977 unit sales, with the core suburban average selling price at €308,000.

The building company said inflation was a challenge for the sector coming into the latter half of the year as continued global supply chain constraints increased prices. Inflation of 6 per cent in the second half of the year was marginally ahead of the 5 per cent reported in the first half of the year, with cost inflation being offset by similar HPI levels.

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Glenveagh said it had broadened its supply base in a bid to get greater control over costs.

Glenveagh said it made progress on Dublin Docklands through the forward fund of the Premier Inn Hotel with Union Investments of €70 million and the sale of the residential and second hotel sites for €78.5 million.

The year also saw it awarded two partnership deals in Dublin totalling 2,000 units, and heads of terms have now been signed for two forward fund transactions totalling over 500 urban apartments, with an aggregate net development value of €185 million.

Glenveagh said suburban land acquisitions of €72 million added 2,700 units to the landbank, with the total value below €575 million at the end of the year. The total landbank value is forecast to be under €525 million by December 31st, 2022.

"Our business continues to perform strongly as we focus on scaling our operations and delivering high quality, sustainable homes in Ireland. By prioritising our people, customers, communities and the environment we are well placed to achieve our ultimate target of over 3,000 homes each year," said CEO Stephen Garvey.

Labour shortages

“As we look to 2022 and beyond the next key challenge for our business and the broader industry is the impact of on-site labour shortages. Our ongoing investment in supply chain integration positions us well in this regard. Having delivered over 700 units from our timber frame factory in 2021, we will continue to prioritise our off-site manufacturing capability to enable us to innovate how we build the homes of the future.

The company completed a €75 million share buyback programme during 2021, and made progress on a new €100 million programme. That brought the total of shares repurchased during the year to 100 million, with a total price tag of €108 million.

Looking ahead Glenveagh is targeting 1,400 suburban home completions and revenue from forward-fund transactions in 2022. Full-year results will be published in March.

The group is targeting continued revenue and profit growth in 2022. “The market backdrop remains favourable with continued significant demand for housing, particularly starter homes, evident across the group’s selling sites,” Glenveagh said.