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Social home completions down by almost a third at Bellway
The number of social homes delivered by Bellway decreased by 32% in 2023-24, as it reports a further £37m in legacy building safety costs.
The house builder delivered 1,896 social homes compared to 2,779 in 2022-23, according to its accounts for the financial year to 31 July 2024.
The drop was due to a “planned reduction” in output, reflecting a lower order book in July 2023 and softer trading conditions in the first half of the financial year.
Keith Adey, group finance director at Bellway, said: “We have good visibility on our near-term build programmes, and we expect a similar number of social housing completions in the current financial year.”
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The developer had previously ramped up its social homebuilding from summer 2022 “as part of a wider programme of cash generation and maintaining financial resilience”.
It said it is targeting completions of at least 8,500 homes overall this financial year, compared to 7,654 in 2023-24.
Bellway also reported £37m in net expenses associated with legacy building safety, versus £49.6m in 2023.
It said this includes an extra £15.3m for structural defects related to “an isolated design issue with the reinforced concrete frame” of an apartment scheme in Greenwich, taking the total provision for the cost of the remediation work to £45.6m.
The increase reflects changes in the approach to remediation, the house builder said, adding that it was “actively pursuing recoveries” from firms involved in the Greenwich development.
“Given the complexity of this process, these have not yet been recognised as an asset,” it said.
Total revenue reduced by 30.1% to £2.4bn year on year as a result of a “lower starting forward order book and challenging trading conditions”.
Overall profit for the year dropped by more than 50% to £130.5m.
It also reported £5.4m in costs after its bid to buy rival Crest Nicholson fell through.
In August, Bellway declined to make an offer to acquire rival house builder Crest Nicholson days after the deadline to do so was extended. It had previously made a revised takeover bid of around £720m.
Bellway announced that it was targeting an increase in the use of timber frame “to around 30% of housing output by 2030”, compared to 12% in 2023-24, and opening a timber frame manufacturing facility in Nottinghamshire called Bellway Home Space.
It expects to produce its first homes from the facility by mid-2026 and will eventually produce up to 3,000 homes per year by 2030.
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