Fry unveiled as chairman as Cala losses narrow to £27m

Cala Group, the Scottish housebuilder that underwent a life-saving financial restructuring last year, has further reduced its losses and appointed City veteran Anthony Fry as chairman.

• Chief executive Alan Brown, right, unveils Cala's new chairman Anthony Fry, previously a non-executive director at Mowlem

The Bank of Scotland-backed firm has drafted in Fry, also chairman of Dairy Crest and a senior adviser at boutique investment bank Evercore Partners, to replace the interim chairman, Professor Ian Percy.

Accounts soon to be filed at Companies House will show the Edinburgh-based housebuilder booked pre-tax losses after exceptional items of 27.1 million in the 12 months to 30 June, down from 33.9m the previous year.

At the operating level, the shortfall eased to 3.9m from 6.2m while turnover edged up to 172.2m from 168.9m amid "the better than expected performance of the housing market".

Cala, one of several Scottish housebuilders backed by HBOS' former head of corporate Peter Cummings during the boom years, underwent a major restructuring last December.

Details of the debt-for- equity swap with Bank of Scotland - part of Lloyds Banking Group - were never disclosed, but it followed just a few months after the departure of Cala's founder and executive chairman Geoff Ball and group managing director Alan Downie. Percy, who was at the time senior independent director, took over as chairman until Fry's recruitment while Alan Brown was promoted to chief executive.

In June 2008, the firm was sitting on colossal losses of 266.1m.

Earlier this year, Cala announced fundamental changes to its strategy in an attempt to return to profitability in 2010-11, including its decision to end all new investments in the battered commercial property sector through its Cala Properties operation. It also revealed it was winding down its Cala Finance division which offered funding to other residential developers.

The privately-owned housebuilder said yesterday that market conditions would remain "challenging and uncertain" in the coming year amid "on-going concerns around mortgage availability and buyer confidence".

However, it insisted that it had already achieved "healthy" forward sales. At the end of the latest financial year, Cala's forward sales stood at 35 per cent, up from 29 per cent at the same time in 2009. The firm said that by the end of September, this figure had jumped to 52 per cent.

Cala has also continued to rebuild its landbank.The group's consented landbank stood at 3,400 plots as of 30 June, which it claimed, had a turnover value of more than 1 billion.

Nobody from Cala was available for comment, but Brown said in a statement: "Our strengthened balance sheet will be particularly important in helping us add to our already strong landbank."

New chairman Fry was previously a non-executive director of construction firm Mowlem and he was also responsible for structuring the National Lottery in the Nineties.