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Berkeley hits profit goals two years early

Housebuilder Berkeley’s five year plan to double its May 2010 pre tax profit will be achieved at least two years early, the company said today.

Speaking at the annual general meeting today chairman Tony Pidgley will say that since the original plan was announced in May 2010, trading has been ahead of expectations.

As well as doubling profit within five years, the original plan had aimed to grow gross margins in the land bank from £2 billion to £3 billion in the same period and to be market leader in the use of Building for Life criteria.

Mr Pidgley will say:  “Together with the performance in the period since 1 May 2011, the board believes that it is now positioned to achieve the profit target set in the five year plan at least 2 years earlier than originally anticipated, to the extent that market conditions prevail. 

“Market conditions in the four months ended 31 August 2011 have enabled further growth in forward sales which are currently in excess of £850 million.”

Berkeley has added a further 7 sites to its land bank in the four months to the end of August.

It has also won improved consents on a number of schemes including sites in Battersea, Kew, North Bersted and Gillingham. 

“These successes, coupled with further investment in work in progress, indicate that market conditions, as opposed to delivery, will be the most important factor in determining the extent of further growth in the business,” Mr Pidgley will add.

The statement follows the group’s full year results in June when it announced a 10 year dividend plan worth around £1.7bn.

Mr Pidgley told CN at the time he was not calling the top of the market.

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