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Housebuilder Cala reports record profits

Premium house builder Cala has posted record pre tax profits for the year ended 30 June 2012.

Revealing revenue of £253.7m, up from £215.4m in 2011, it said pre tax profits rose from £2m to £11.4m - the highest level since going private in 1999. The firm’s operating margin rose from 7.1 per cent to 11.9 per cent.

Cala said its operations in the South-east of England and the East of Scotland are proving to be ‘particularly robust’. 

Its debt pile was reduced to £98.4m, from £116.1m the year before, and net assets of £75.3m. The company said its debt reduction plan is ‘ahead of schedule’ after extensive restructuring three years ago.

Cala completed 875 homes during the period (2011: 649). Private completions increased 24 per cent to 666 homes (2011: 538), with average selling prices of £340,000 (2011: £328,000) - which is the highest of the major home builders.

Chief executive Alan Brown said: “Cala has delivered an excellent performance during 2012 with our highest profits since the group was taken private in 1999, improved gross margins and excellent progress in developing the length and quality of our landbank.

“In a relatively flat market, the group’s premium market positioning, industry leading customer service and presence in the more affluent areas of the UK such as the Home Counties, the Cotswolds, Edinburgh and Aberdeen have helped us exceed our sales and profits targets for the year, providing a firm platform from which to build.”

The firm had owned and contracted landbank of 9,600 plots with a potential gross development value of £3bn, equivalent to approximately nine years’ output on current projections. It said 92 per cent of this comprises higher gross margin land unaffected by, or contracted after, the Housing market downturn. 

Mr Brown said they envisage further growth across the business.

The firm secured an extension to its current bank facility with Lloyds in January, which is now in place until 31 December 2014 and secured “on broadly the same terms as the previous agreement with Lloyds Banking Group”.

Cala welcomed the NewBuy initiative, but said as it operates towards the higher value end of the marketplace, its customers tend to be less reliant on mortgage financing and are therefore ‘considerably less affected’ by mortgage constraints.

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