Bellway sees recovery as order book hits record highs

The order book for housebuilder Bellway has grown to record levels, but the number of houses it built are still lagging behind pre-pandemic levels.

The business said it completed 10,138 homes in the 12 months to the end of July. It was a third more than in the same period a year earlier as completions were hit by the March 2020 lockdown.

However, the levels are still below the 10,892 homes completed in the year ending July 2019.

In a trading update to shareholders on Tuesday, Bellway showed both a recovery and a hangover from the pandemic.

The 12-month period includes many lockdown months, so unsurprisingly revenue is still 2.5% lower than 2019. Yet it soared by 41% to more than £3.1 billion compared to 2020, Bellway said.

Yet, on the other hand, sales are going strongly. Bellway’s order book reached more than 7,000 homes, an all-time record, and more than 2,200 higher than 2019.

Land prices were pushed down during long periods of the pandemic, opening up opportunities for companies like Bellway with the cash to spend.

In total, the business put a little under £1.1 billion into acquiring nearly 20,000 land plots around the country.

This compared to a £778 million spend in the year ending July 2020, and £788 million a year earlier.

“Bellway has been one of the most prolific land investors in recent years and this stepped up post the first lockdown and should position the group well to recover strongly from the Covid hit,” said Numis analyst Chris Millington.

Bellway said: “This reflects the strong, long-term demand for good quality housing and has resulted in a strengthened land bank, providing a solid platform for ongoing growth and margin recovery in the years ahead.”