Scottish homes builder warns of 'chronic undersupply of housing' as turnover surges past £200 million

Springfield Properties, Scotland’s only listed housebuilder, has flagged record turnover of more than £200 million as the firm looks to address the country’s “chronic undersupply of housing”.

Full-year revenue is expected to come in at about £215m, representing year-on-year growth of 49 per cent and the group’s highest ever annual turnover.

In a trading update ahead of announcing its final results in September, the firm said growth was being driven by increased sales in private and affordable housing and a contribution from strategic land sales.

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A “substantial increase” is expected in pre-tax profits, in line with recently upgraded market expectations.

Innes Smith is the chief executive of Springfield Properties, which is Scotland’s only listed housebuilder.
Innes Smith is the chief executive of Springfield Properties, which is Scotland’s only listed housebuilder.

Meanwhile, net debt has been reduced to some £21m at year end, achieving a £50m reduction compared with the end of May 2020.

On the private housing front, Springfield said it had achieved excellent sales at its developments across Scotland “reflecting the increased desirability for the type of housing the group offers”. It pointed out that its homes were generally larger properties, with space for home offices and with gardens, which are located in “semi-rural” areas.

In particular, completions at the group’s Linkwood Village in Elgin and at three developments launched under the Dawn Homes and Walker Group brands made an “important contribution” to the revenue growth in private housing.

In affordable housing, the group delivered a “substantial” increase in revenue and completions in the second half of the year over the first six months.

The firm also signed contracts for, and commenced work on, several new affordable developments that are due to be delivered in the current year. This progress is supported by the “continued commitment” of the Scottish Government to the delivery of affordable housing, bosses noted, with more than £3.4 billion earmarked for affordable housing funding through to March 2026.

Innes Smith, chief executive of Springfield Properties, said: “This has been an excellent year for Springfield. We have achieved our highest ever annual revenue – exceeding £200m for the first time – based on significant growth in both our private and affordable housing.

“We have substantially reduced our net debt position, demonstrating our ability to generate cash, and our strategic land sales towards the end of the year reflect our capacity to realise value from our large, high-quality land bank.

“A key driver of our growth has been the greater popularity of the spacious homes that we provide, with private gardens and easy access to surrounding greenspace, particularly at our Village developments. At the same time, there continues to be a chronic undersupply of housing of all tenures across Scotland.

“Thanks to the strength of our offer and of our partnerships, which will now include the delivery of homes for the private rented sector, we are exceptionally well-positioned to help meet this housing demand and provide great places for people to live, building quality homes and creating sustainable communities.”

Last year, the firm was given the green light to construct its first homes for the private rental market. It was granted planning approval for 75 homes to be built at its Bertha Park development in Perth.

The move followed a tie-up between the housebuilder and Edinburgh-based Sigma Capital Group.

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