Galliford Try expects record result after housebuilding sales rate rise

Construction group Galliford Try expected record full-year results after sales rates improved following the general election.

In a trading update for the year to 30 June, Galliford said profit before tax would be toward the upper end of analysts’ range.

The company has a net debt of £20m, up from £5.1m the year before.

Galliford said sales rates had improved since the elections and were up 49% on the same period last year.

The group also said 88% of revenue for the new financial year had been secured.

Galliford Try executive chairman Greg Fitzgerald said it had been another record year, and the firm was encouraged by the outlook.

“Labour availability and cost remain challenging but we continue to manage this effectively working closely with our supply chain.

“Housing market conditions remain positive and the directors take further confidence from the significant increase in the group's landbank as well as the contracting order book within partnerships,” Fitzgerald said.

Numis left its forecasts unchanged, continuing to rate the stock at ‘hold’ with a price target of 1619p.

The broker said the group traded significantly above the trend line, and while its proposed dividend yield was attractive, it is in line with the peer group average.

“As a result, we prefer others for UK housebuilding exposure and, in particular, Bellway,” Numis said in a note.