Housebuilder Cala has said it would target affluent markets in the south of England, Edinburgh and Aberdeen following a £210 million takeover which has left the group in a “formidable” position.
The capital-based firm, acquired by Patron Capital Partners and insurer Legal & General in March, said its new stakeholders would enable it to capitalise on fresh opportunities in what will be seen as another boost for the housing sector.
Its optimism comes as results for the year to the end of June revealed margin growth of a fifth.
Chief executive Alan Brown said he was confident about the outlook for “the UK’s most upmarket major home builder” during the coming financial year.
“The last 12 months have been transformational for the group with the investment from Patron and Legal & General in March 2013 providing us with a strong platform from which to grow our business and build upon the strong momentum we have generated in recent years,” he said.
“Alongside this, I’m delighted to report that the group has continued to trade ahead of management’s expectations with our industry-leading customer service levels helping us to achieve record levels of profitability for the period.”
He said the lending programmes, including the Bank of England’s Funding for Lending scheme, had provided a “much-needed boost to the mortgage market”.
“These initiatives have enabled first-time buyers to get on to the property ladder, which in turn has had positive implications on market confidence generally as well as further up the housing chain where we operate,” he added.
“Having successfully secured the support of two blue chip financial backers, we are now able to realise our growth ambitions through our operations in the most affluent markets in the UK such as southern England, Edinburgh and Aberdeen.”
Cala which counts developments in Dunblane, Auchterarder and at Liff, by Dundee, among its recent projects said its 19% growth in gross margins had helped deliver record like-for-like profits, aided by proceeds from properties built on land acquired cheaply in the immediate aftermath of the 2008 economic downturn.
Its average selling price slipped slightly to £333,000, though the mark was enough for Cala to oustrip its listed rivals on average receipts from new-build properties outside London.
The company said the spring selling season had been particularly strong, with a “tangible shift in market momentum”, increased buyer confidence and a better mortgage availability leading to an increase of 4% in the number of private sales.
Total completions fells slightly, thanks to a tough comparitor last year and the firm’s reduced exposure to affordable housing this time out.
Its 9,600-plot land bank has a prospective developed value of £3.1bn, while debts have fallen to their lowest level since Cala was taken private in 1999, at less than half the group’s £100m facility.
Around 170 properties are proposed for sites across Stirling and Perthshire, at Doune, Bridge of Allan, Auchterarder, Balfron and Perth.
Graham Cunningham and Kevin Whitaker have been appointed regional chairmen of the South of England and the East of Scotland region, Cala added.