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Spotlight: Crest Nicholson

FINANCE

LIKE many of the larger house builders, Crest Nicholson has put more emphasis on social housing.

In the half to April, the company increased its social housing output by 72 per cent from 300 to 516 units and for the full year it is expecting to make over 900 affordable completions.

Yet the increase in afford - able output has impacted the group's average selling price, which fell to £188,000 from £208,000 from last time.

The resulting pressure on margins helped drive down pre-tax profits at the group by almost 20 per cent to £39.2 million in the half.

But the firm, one of the house building sector's perennial bid candidates, reassured the City when it said the housing market had been stronger in the first half and its net reservations were higher as purchaser confidence improved.

The firm has secured over 85 per cent of its full year target and expects its total completions to be 20 per cent higher this year.

In the first half, its open market completions rose slightly to 1,062 un its .

Although the group's margin's slipped to 13.7 per cent chief executive Stephen Stone said the firm expected to steadily improve the margin and that it was on track to make £10 million of cost savings by 2008 through a combination of lower product and overhead costs.

But commercial sales from the firm's mixed-use schemes fell by almost a half to £22.9 million and for the full year are expected to be down by a third on the £92.3 million recorded last year, mainly due to planning delays on a project in Camberley