Cala Group (Holdings) has released the preliminary results, ahead of audited accounts to be finalised in March, and said strong market conditions in the first nine months of the year enabled it to sell out for 2022 in September, securing an “excellent” year of trading overall. Revenue enjoyed a 9 per cent year-on-year increase to reach £1.36 billion, while it expects pre-tax profit to be up by more than a quarter to amount to a record £169 million, with both jumps attributed to higher new homes completions and a significant uplift in private average sales price (ASP).
The group, whose Scottish base is in Edinburgh, said total home completions were up 4 per cent to 3,027, and the ASP grew to £492,000 from £462,000 in 2021, as a result of sales price growth and the mix of sites sold during the year. However, Cala – which is owned by Legal & General – said it entered the new financial year with 751 forward private reservations equating to £396m gross development value (GDV), down from 994 and £488m respectively in the prior 12-month period, and sales per site per week came in at 0.62 compared to 0.76 achieved in 2021 as a result of a material change in sales rates in the final quarter of 2022 following the mini budget.
The group – which started as the City of Aberdeen Land Association in 1875 and was the first Scottish company listed on the London Stock Market – also said the land market was “highly competitive” throughout 2022, during which it contracted 22 new short-term developments, expected to deliver 3,270 homes with an anticipated GDV of £1.3bn.
Cala Group boss Kevin Whitaker said: “Cala has delivered an excellent performance across 2022, achieving significant increases in revenue and pre-tax profit. We benefited from excellent market conditions in the first nine months of the year. During the final quarter of 2022, the impact of the UK Government’s mini budget on the financial markets directly influenced buyer confidence. This has naturally affected sales rates in recent months and has impacted the strength of our forward sales position.
“2023 will be challenging for everyone, due to the increased financial pressures associated with higher living costs and mortgage repayments,” he added, saying Cala is “well-placed to navigate the changing market conditions”. He also said the major shortage in the supply of new homes continues to support new-build delivery, with Cala’s offering continuing to attract buyers – and the firm is set to expand its landbank this year.
The firm, which in July reported strong half-year sales, has also now said it is making steady progress towards achieving its targets of building homes for its customers that are operationally net zero carbon enabled from 2030 and reaching net zero greenhouse gas emissions in line with the Scottish Government’s 2045 target and ahead of UK Government’s 2050 target. It also pointed out that it has established net zero road maps for each regional business to identify and schedule priority actions, also stating that its homes’ energy-saving credentials will continue to support sales throughout 2023.