Bovis profits tumble following complaints

'‹H'‹ousebuilder Bovis Homes'‹ said profits have fallen by almost a third '‹and it will rein in growth plans.
By The Newsroom
Published 7th Sep 2017, 09:17 BST
Updated 11th Sep 2017, 12:39 BST
Bovis Homes sign advertising new homesBovis Homes sign advertising new homes
Bovis Homes sign advertising new homes

The decision follows customer complaints over the quality of its homes.'‹The firm'‹ appointed a new chief executive, Greg Fitzgerald, earlier this year to turn around the business, which expects volumes and profits to fall this year as it focuses on quality.Bovis said it now '‹aims to build 4,000 homes '‹a'‹ year, significantly lower than a previous management target of 5,000'‹ to '‹6,000 homes, and '‹it will focus much more on delivering affordable housing.P'‹re-tax profits for the six months to June 30 '‹fell 31'‹ per cent'‹ to £42.7'‹m, with the firm also booking exceptional advisory costs linked to defending itself from two aborted takeover attempts from rivals Galliford Try and Redrow.The group has so far set aside £10.5'‹m to cover remedial work and compensation for customers after the firm was dogged by complaints over homes that were sold unfinished and had electrical and plumbing faults.Revenue for the period rose 4'‹ per cent'‹ to £427.8'‹m, with the average price of the firm's homes rising 9'‹ per cent'‹ to £277,400.But completions fell 6'‹ per cent'‹ to 1,512 following a pledge to slow the rate at which it builds homes in 2017 as part of a "re-set" under '‹Mr Fitzgerald.The chief executive described the first half as a "period of stabilisation and strategic reorganisation" as he looks to get the business back on track.He added: "I have visited all our offices and the vast majority of our developments, and have been hugely impressed by the desire of our dedicated staff to address and rectify the challenges faced by the business."As a result I am confident that our new strategy will set the Group on the path to sustainable, profitable growth.'‹"'‹The new strategy of disciplined volume growth, allied with a renewed focus on customer satisfaction and build quality, will deliver the homes that are required in the locations where people want to live."As part of Mr Fitzgerald's shake-up, he will reduce headcount at the business, with 120 jobs already axed.Bovis said that it has seen "a good pick-up in sales" in the traditionally quieter months of July and August and a "significant improvement" in its customer satisfaction score, which has been trending at 74'‹ per cent'‹ since the beginning of February.The group said it is confident of delivering profit in-line with management expectations for 2017 and also announced special dividends totalling £180'‹m to be paid over three years to 2020.