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Gleeson profit halves | Construction News

Revenue has fallen sharply at MJ Gleeson amid continued strain on the housing market.

The housebuilder noticed pre-tax revenue fall to £7.2m within the six months to 31 December 2023, down from £16.1m in the identical interval in 2022.

Its income fell from £171m within the second half of 2022 to £151.5m in the identical interval in 2023, it introduced on Thursday (15 February).

The corporate bought simply 769 properties within the interval, down from 894 within the final six months of 2022.

Gleeson chief government Graham Prothero mentioned the income fall mirrored “challenges skilled by the housing market” and wider macroeconomic situations.

“In widespread with others throughout the sector, we skilled margin pressures arising from elevated gross sales incentives, prolonged web site durations and multi-unit gross sales,” he added.

One year ago, the corporate introduced a restructure together with 50 job cuts from its 800-strong workforce after its pre-tax revenue fell from £24.7m to £16.1m. This week’s announcement mentioned its administrative bills had dropped 12 per cent to £24.8m because of this.

Web debt has risen to £18.7m, in contrast with a web money place of £13.5m 12 months earlier. It mentioned this was on account of “a rise in construct exercise on websites and the funding in bringing ahead a better proportion of residence begins earlier than June 2023”.

Prothero mentioned that the planning system “continues to be very poor”, including that “under-resourced planning departments” are taking greater than two years on common to consent to its websites.

“The federal government has downgraded native housing targets, as confirmed within the not too long ago revised NPPF [National Planning Policy Framework], additional weakening the important obligation on native authorities to make land obtainable for much-needed new properties,” he added.

However, Prothero insisted Gleeson’s pipeline was robust.

“Towards the backdrop of enhancing mortgage charges, we’re seeing constructive indicators of a restoration in demand. We count on this to proceed into the seasonally busier promoting interval over the approaching weeks and months,” he mentioned.

“The enterprise has traded nicely in tough situations and is well-placed to capitalise on a restoration available in the market and resume its thrilling development technique.”