Strong fundamentals lead to positive year for Tulloch

Tulloch Chief Executive George Fraser.
Tulloch Chief Executive George Fraser.
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“Robust” homebuyer confidence and low interest rates have underpinned a positive performance at Inverness-based Tulloch Homes and fuelled its board’s confidence on prospects.

Tulloch Homes, focused mainly in the Highlands and Aberdeenshire but which over the past year made the first foray into Scotland’s Central Belt for a number of years, said that operating profit lifted 8 per cent to £8 million in the year to end-June 2017.

Pre-tax profit climbed 13 per cent to £7.7m from £6.8m last time, while turnover fell from £45m to £43.5m.

Tulloch, formed 90 years ago, saw the total number of homes it sold drop 10 per cent to 180 from 201, but the average selling price rose to £210,000 from £203,000.

Of the company’s renewed move in the Central Belt, it said that it had developed a collection of two-bedroom flats in East Kilbride village, in the heart of the old area of the town, that “have proven to be popular off-plan purchases among home buyers”.

George Fraser, Tulloch’s group chief executive, said: “Our measured investment in suitable sites combined with low interest rates and a relatively stable economy in our primary areas of activity have contributed to another positive year for the firm.”

He said that confidence among house buyers appeared to be remaining robust.

The group, which employs some 150 workers directly and has about 300 subcontractors across the Highlands and North-east of Scotland, said its land bank was also “very healthy”.

Fraser said he expected to see home unit numbers and prices remain consistent in the year ahead.

“We are also in the final stages of our non-core asset disposal programme, which we set out at the time of the management buy-out to focus on returning the company to being purely a housebuilder,” he added.

“That has contributed to a significantly strengthened balance sheet and puts us on a strong footing for continued investment in the years ahead.”

Tulloch’s latest strides follow strong results and trading updates from a flurry of housebuilders late last year and in early 2018, including Persimmon, Taylor Wimpey and Bovis.

Persimmon, whose Charles Church subsidiary is strong in Scotland, posted a 25 per cent jump in annual profits in February, while Bovis and Taylor Wimpey have talked of strong industry “fundamentals”, including the Help to Buy scheme.