SCOTTISH housebuilder Mactaggart & Mickel has ramped up profits for a fifth year in a row following a robust performance by its flagship homes division, as its chief executive declared the firm has seen no ill-effect from the broader economic uncertainty.
The family-owned firm, which is on track to build its first houses in England next year, hiked profits by 22 per cent to £12.7 million in the year ending April 30.
That came as it sold 167 new homes over the period, two fewer than the year before.
With its new homes achieving an average sale price of £351,000, up 21 per cent on the prior year, Mactaggart & Mickel’s dominant homes division saw turnover increase to £62m from £55m the year before. Overall turnover at the group – which also has interests in timber systems, affordable homes, commercial property and private property lets – rose 14 per cent to £74.3m.
Asked whether he has seen any evidence of the house-buying public being affected by uncertain economic backdrop, chief executive Ed Monaghan, replied: “We haven’t at all. Post-Brexit, there’s been no real impact on the amount of clients visiting our sales centres or taking up reservations for new homes. We’re slightly ahead of projections [for our current year], so visitor numbers and sales have remained strong.”
Mr Monaghan, whose firm has traditionally focused on Newton Mearns, Ayrshire and Edinburgh, said all parts of the business were benefiting from a “buoyant” housing market, which is being driven by the demand for homes on both sides of the Border.
He played down the likely impact of a widely anticipated rise in interest rates of 0.25 per cent to 0.5 per cent when the Bank of England’s Monetary Policy Committee meets on Thursday.
“I don’t see it being sustained, in terms of it continually going up,” Mr Monaghan said.
“I think it will be marginal and the market has probably already built it in. Indeed, there is quite a buoyant mortgage market out there for future clients to be able to be selective about products for themselves.”
Mactaggart & Mickel highlighted its progress south of the Border, where it is on track to start building its first homes early next year. It has received outline planning permission to build on two sites in Oxfordshire, or “Greater Cotswolds” area, which are broadly located a one-hour commute from central London.
The firm’s focus on England in the last seven years has been on acquiring land and securing planning consent for sites before selling them on to developers.
Mr Monaghan described the move into housebuilding in England as a “natural progression” for the business, which can trace its roots back to 1925. “We think there is a space in that market we are targeting,” he said. “We’re not a plc, but there is a need to bring other players into the market and we have been very encouraged by the response we have received from both planning authorities and landowners.”
Mr Monaghan, whose firm increased its headcount to 279 from 263, expects to build between 15 per cent and 20 per cent more homes, and achieve a further rise in profits, this year.
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