Springfield Properties (SPR) H2 2024 earnings summary

Executive summary

• Exceeded profit before tax and exceptionals target with GBP 10.6 million, and reduced net bank debt to GBP 39.9 million, outperforming expectations.

• Strategic focus on land sales, cost reduction, and working capital management drove financial outperformance.

• Dividend reinstated at 1p for the year due to improved financial position and outlook.

• Large, high-quality land bank maintained, with 88% of owned plots having planning permission.

• Recovery in private housing post year-end, with reservation rates ahead of the same period last year.

Financial highlights

• Revenue declined to GBP 266.5 million from GBP 332 million year-over-year, mainly due to lower private housing sales, partially offset by GBP 28 million in profitable land sales.

• Gross margin improved to 16.3% from 14.4%, and operating margin rose to 6.7% from 6.2%.

• Operating profit was GBP 18 million, compared to GBP 20.7 million in the prior year.

• Net bank debt reduced by GBP 21.9 million to GBP 39.9 million; 12-month term loan of GBP 18 million repaid in full.

• Net assets increased to GBP 158.2 million from GBP 150 million.

Outlook and guidance

• Expecting a strong increase in profits for the next year, supported by recovery in both private and affordable markets and a strong contracted order book.

• Build cost inflation expected to be broadly flat for FY 2025.

• Anticipate further growth in affordable housing, with potential for PRS expansion in the north.

• Confident in ability to capitalize on infrastructure investment and electrification projects in Scotland.