Housebuilder Cala Group has reported continued “relative confidence” in the Aberdeen market despite inflation blowing a large hole in many people’s savings.
The company said there were “great opportunities in the pipeline” for its Granite City-based north business.
But it declined to comment on whether it is mulling a takeover of Aberdeenshire rival Stewart Milne Homes (SMH), which is up for sale following the decision by its millionaire founder and chairman, construction entrepreneur Stewart Milne, to retire.
First half profits up 26%
Results for Cala, which started in 1875 as the City of Aberdeen Land Association and was the first Scottish company listed on the London Stock Market, show a 26% year-on-year jump in pre-tax profits to more than £98 million for the six months to June 30.
Turnover for the latest period totalled £688m, up 15% on the £600m posted for the first half of last year as average selling prices at the high-end housebuilder jumped more than 8% to £491,000.
Market demand has continued to support both strong sales rates and pricing, offsetting the ongoing construction cost inflation the industry is experiencing.”
Kevin Whitaker, CEO, Cala Group.
Cala completed 1,527 new homes around the UK in the first six months of this year, an increase of 3% on the 1,479 reported for H1 2021.
The firm said it had a “robust” forward sales position of reservations for 90% of its private homes reaching completion in 2022.
Its Scottish and English operations are now run from offices in Edinburgh and Wooburn Green, Buckinghamshire, respectively.
The group’s Aberdeen-based Cala Homes (North) business is led by managing director Mike Naysmith, who said: “It has been a positive first half of the year for Cala, and the north region has some notable developments under way and great opportunities in the pipeline.
“We currently have six live developments across Aberdeen, including the much-anticipated TwentyFour, Rosemount, a collection of city centre apartments which launched earlier this year.
“Work is also set to begin on the third phase of our Grandhome development and a brand new site, 22 King’s Gate. We have submitted planning applications for the fifth phase of our landmark Craibstone Estate community, and for a potential site in Burnland, Westhill.”
Mr Naysmith added: “Relative confidence remains in the Aberdeen market and we continue to commit to investing in the region through our drive to purchase land in the city and Aberdeenshire.
“We are pleased to be forging ahead with our plans for the area under our refreshed brand, which is currently being rolled out across all sites, and look forward to the rest of the year.”
Asked about speculation linking Cala to a possible bid for SMH, based in Westhill, near Aberdeen, a spokeswoman for the group said: “We wouldn’t be able to comment.”
Cala, which is owned by financial services giant Legal & General, said its total for home completions during 2022 was likely to top 3,100 – a new record and an increase of 7% on the 2021 figure of 2,904.
Group chief executive Kevin Whitaker added: “The first half of 2022 has seen the group deliver a very strong performance, ahead of forecast units, turnover and pre-tax profits.
“The strength of the sales market in 2021 has continued into this financial year and we have achieved a robust forward sold position.
“Market demand has continued to support both strong sales rates and pricing, offsetting the ongoing construction cost inflation the industry is experiencing.”
Mr Whitaker said Cala’s market remained “favourable” despite wider economic factors casting “potential uncertainty and negative sentiment”, adding the company was making good progress towards its goal of £1.8 billion annual revenue by 2026.
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