Strong operational performance at Henry Boot leads to record underlying profit

In the year ended December 31 2022, the company achieved a record underlying profit of £56.1m, which was an increase on the £29.3m achieved the previous year. Henry Boot said this improvement was driven by residential land and property development sales.

Last year, it secured revenue of £341.4m, which is an increase of 48.0 per cent on the previous year, while profit before tax increased to £45.6m from £35.1m in 2021.

Tim Roberts, the chief executive officer, commented: “During what ended up being a turbulent year in which rising interest rates led to a rerating of the UK property market, Henry Boot delivered our best ever underlying profit and grew our NAV (Net Asset Value), which has allowed us to carry on increasing the dividend by 10 per cent.

“The main driver of this performance has been strong sales activity across our three key markets of industrial and logistics, urban development and, most notably, residential where we successfully sold a record number of plots of land.

"Management actions, through nearly £30m of well-timed and accretive investment property sales, have led to a material outperformance of the investment portfolio against the CBRE index. Total property sales of £279m, combined with selective acquisitions, means gearing remains firmly at the bottom of our target range.

He added: “Whilst we remain cautious about the near-term trading climate, expecting 2023 to be a tougher year, our rock solid balance sheet offers resilience to both weather any further economic uncertainty and to take advantage of any opportunities that arise from it.

"With early encouraging indicators already evident across certain markets we have the capacity to buy land, maintain and potentially expand our committed development programme as well as to continue to grow our JV (joint venture) housebuilder as soon as we feel economic recovery is on the way. We therefore have confidence in our ability to achieve our medium-term growth and return targets.”

In a statement to accompany the results, Henry Boot said: “The year started off buoyantly with encouraging levels of demand across our three key markets, which offset cost pressures and supply constraints, but with energy prices fuelling inflation and rising interest rates, we saw a marked slowdown in Q4 (the fourth quarter) of 2022.

"However, as we enter 2023 there are encouraging signs that the economy is proving slightly more resilient than expected, and demand is recovering with a resumption of activity in our markets.”

Henry Boot said its improved results for the year were driven primarily by residential land sales at Hallam Land Management (HLM), a mix

of land sales and development profits at HBD and house sales at Stonebridge Homes. The proposed final dividend is 4.00p, which is an increase of 10.2 per cent, Henry Boot said.