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Bovis Homes forward sales 34pc up on last year

Bovis Homes said today that it has forward sales for 643 homes in 2010 - 34 per cent greater than the same point in 2009.

In a trading update Bovis said a pick-up in sales momentum occurred in the second half of the year with 754 sales in the first half and 1,049 homes in the following six months.

During 2009, the Group sustained its strong performance in private home reservations, achieving 1,801 private reservations during the year, some 82 per cent ahead of the prior year’s 989 private reservations.

As at 31 December 2009, Bovis held housing work in progress equivalent to 986 homes.

Bovis said it had made good progress in securing further construction cost savings and has re-entered the residential land market during the latter part of 2009 following a successful period of de-gearing and supported by its share placing.

Good progress has been made across the geographical areas of focus and the group has acquired four sites in late 2009, with terms agreed in principle on a further 15 sites.

Towards the end of 2009, Bovis initiated discussions with its banking syndicate in regards to its existing banking facility.

The group now has credit approval subject to documentation for a replacement £150 million syndicated facility which would mature in September 2013 and which will reduce its effective interest cost.

The new facility will provide Bovis with the financial flexibility to allow it to benefit from its strong balance sheet by continuing the process of re-investment in residential land, to increase the output capacity.

In its 2009 results Bovis bosses anticipate writing off around £4 million of a one-off fee paid in December 2008 in relation to the existing banking agreement as an exceptional item.

Further information will be provided once the refinancing exercise is completed.

The trading update said: “The group continues to expect trading conditions in 2010 to be subdued relative to historical levels, given ongoing economic uncertainty.

“Mortgage approval volumes are slowly rising, but mortgage providers continue to require record high levels of deposits, particularly from first-time buyers.

“This all said, longer-term market demand and supply trends remain positive.”