MJ Gleeson PLC (LON:GLE) said it expects to top current market forecasts and bring back dividends as it enjoys strong demand from first-time buyers.
The Sheffield-based housebuilder and strategic land specialist, which focuses on low-cost homes in the Midlands and north of England, said it has opened 11 building sites since the start of its financial year in July and currently has 80 sites open, compared with 64 a year ago.
“Record new site openings, strong demand driven by the structural need for low-cost quality homes for first-time buyers and our ability to offer attractive levels of affordability to our customers, mean that the outlook for the division remains very positive,” said chairman Dermot Gleeson in a statement ahead of the group’s annual shareholder meeting today.
As a result, he said the board now expects the housebuilding arm’s results for the year to exceed expectations, with sales revenue for the six months to end-December growing more than 15% on last year.
He said land continues to be available “at sensible prices” and the pipeline remains strong, with the Gleeson Homes pipeline standing at 13,938 plots with a gross development value of GBP2bn, over half of which are owned.
The Strategic Land division, which in a pipeline of 72 sites has 12 with planning permission and seven in the process of being sold, is said to be in line with market expectations.
“In the light of our strong performance to date and the positive outlook, the board is minded to resume dividend payments during the course of 2021,” Gleeson said.
The shares rose 9% by mid-morning to 762p, still down 20% since the start of the year.