Scottish firm Miller Group has its sights set on improving housebuilding and commercial property markets after offloading its construction division.
The builder yesterday reported “robust” trading for its Miller Homes business across the UK, with the subsidiary delivering its highest operating profits since 2007.
Boosted by a 12% rise in the average price of its new homes, driven by a greater focus on larger, family-sized houses in “quality locations”, the division helped overall pre-tax profits at Edinburgh-based Miller more than double to £8.3million.
Group revenue soared to £206.9million during the six months to June 30, from £168.2million a year earlier.
Miller said increased reservation rates and a strong opening order book drove a 28% increase in core housing completions to 855 units.
The group’s commercial property division, Miller Developments, suffered a sharp fall in profits before interest and one offs – slumping to £100,000, from £8.4million previously.
Miller said profits here were heavily weighted towards the second half, with a strong fist half in 2013 also affecting the result.
It added: “The business has been extremely active in the year to date, securing planning consents and progressing occupier interest for our key longer-term development sites at Omega near Warrington, Arena Central in Birmingham and in Aberdeen.
“These developments will provide the backbone to future profitable trading. We have a total development pipeline of 12 million sq ft.”
Miller Developments’ D2 business park in Dyce, Aberdeen, has recently secured three new occupiers.
Work is scheduled to start soon on a new 58,500sq ft office and service centre for Emerson and a 102,500sq ft warehouse building for BP.
Subject to planning, the developer has also secured a sale of eight acres of land to Aberdeen-based logistics group Asco.
“These deals take our infrastructure commitment to around £10million,” Miller said, adding: “Since its launch last year, D2 is quickly establishing itself as a prime location for business in Aberdeen.”
Miller Developments is also part of a joint venture, Miller Cromdale, developing Aberdeen’s North Dee Business Quarter.
Construction is underway on Pilgrim House, a 27,000sq ft office building already 50% pre-let to the Food Standards Agency.
Other Granite City projects involving Miller include the recently completed North Sea headquarters for French energy firm GDF Suez and Liberty House, a 25,500 sq ft office development next to Union Square shopping centre.
Group chief executive Keith Miller said Miller was benefiting from continued improvements in its markets.
He added: “The disposal of Miller Construction in July allows the Group to focus on the housing and commercial property markets which are showing strong signs of growth.”
Galliford Try’s near £16.6million acquisition of Miller Construction was announced last month.