The Berkeley Group (BKG) H2 2024 earnings summary

Executive summary

• Pre-tax profit reached GBP 557.3 million for FY24, down 7.7% year-over-year but in line with guidance; operating margin at 19.5% and net cash above GBP 400 million maintained.

• No new site investments in FY24; focus on efficiency, cost control, and matching supply to demand amid challenging market and regulatory conditions.

• Shareholder returns on track for GBP 283 million by September 2024, with dividends and buybacks; strong ESG performance with 87% of homes on brownfield land and high net promoter score.

• Sales volumes were stable but a third lower year-over-year; sales prices and build costs remained firm.

• Five new planning consents and over 30 revisions secured.

Financial highlights

• Revenue declined 3.4% to GBP 2.464 billion, with lower volumes partially offset by higher average selling prices.

• Gross profit was GBP 644.5 million, with a gross margin of 26.2%.

• Basic earnings per share fell 12.4% to 373.9p, reflecting higher tax and lower profit.

• Net cash increased to GBP 532 million, up 29.6% year-over-year.

• Forward sales fell 20.4% to GBP 1.701 billion; land holdings reduced 6.8% to 54,081 plots.

Outlook and guidance

• FY25 pre-tax profit guidance raised 5% to GBP 525 million; FY26 guidance reaffirmed at GBP 450 million; at least GBP 975 million pre-tax profit targeted across FY25–FY26.

• Operating margin expected to remain in the 17.5%-19.5% range for the next two years; net cash to be held around GBP 400 million.

• Targeting gross profit above GBP 6 billion in land holdings by end of 2026.

• Shareholder returns program committed through September 2025.

• First Build to Rent completions expected in FY27.