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Tony Pidgeley moves to Chairman at Berkeley Group as trading meets expectations with FY profit of £120million
Berkeley Group, the property developer and housebuilder, said full-year profit fell 38% in challenging market conditions, but it had bucked the sector by generating cash and avoiding writedowns.
Berkeley also said today co-founder Tony Pidgley would step down as managing director after 33 years to become chairman and be succeeded by his long-designated successor, finance director Rob Perrins, in a widely expected move.
The group remained cautious about its outlook, with the value of sales reservations half the historic average.
"You've got ups and down. Prices are levelling, (but) transaction levels could dip again if mortgages don't come through," Perrins said.
Berkeley shares were up 2.4% at 824.5 pence at 0920 GMT, after hitting a three-week high of 850 pence.
Berkeley, focused on developments in London and southeast England, said pretax profit fell to £120.4 million in the year to end-April, below the consensus forecast for £132 million according to Reuters Estimates.
It had net cash of £285 million at the end of the year, after raising £50 million to boost its cash pile for land acquisitions earlier this year.
"(This is) bang in line with our expectations and still comfortably ahead of the rest of the industry," said analysts at Citi.
On Thursday, Saudi investor Saad Group, a long-term shareholder, said it had sold a further 4.5 million shares in Berkeley, taking its stake to just 2.73% from 29%.
"The balance sheet is not exposed," said Pidgley. The company said joint ventures with Saad were worth £18.7 million , "half of that is his, half is ours," said Pidgley. The company is currently in talks with Saad's advisors, which may involve Berkeley taking Al-Sanea's equity, he said.
Privately-held investment company Saad has said it is restructuring its $6 billion debts after it ran into difficulties earlier in June, prompting the Saudi central bank to freeze the accounts of its billionaire chairman, Maan al-Sanea
Recent data and trading updates from British housebuilders such as Taylor Wimpey show some stability has returned to the sector.
Berkeley said transaction levels improved in the past quarter with sales prices stabilising, but mortgage approval levels remain at historically low levels.
"They (banks) are rebuilding their balance sheets. I think that's going to go on for a while," said Pidgley.
Rising unemployment is another factor. The Organisation for Economic Cooperation and Development recently said British joblessness was set to rise towards 10% in 2010 from 7.2%, putting further pressure on the housing sector.
Berkeley said Victoria Mitchell would step down as chairman in September whilst Perrins will be succeeded by Nick Simpkin as finance director.
Berkeley also said today co-founder Tony Pidgley would step down as managing director after 33 years to become chairman and be succeeded by his long-designated successor, finance director Rob Perrins, in a widely expected move.
The group remained cautious about its outlook, with the value of sales reservations half the historic average.
"You've got ups and down. Prices are levelling, (but) transaction levels could dip again if mortgages don't come through," Perrins said.
Berkeley shares were up 2.4% at 824.5 pence at 0920 GMT, after hitting a three-week high of 850 pence.
Berkeley, focused on developments in London and southeast England, said pretax profit fell to £120.4 million in the year to end-April, below the consensus forecast for £132 million according to Reuters Estimates.
It had net cash of £285 million at the end of the year, after raising £50 million to boost its cash pile for land acquisitions earlier this year.
"(This is) bang in line with our expectations and still comfortably ahead of the rest of the industry," said analysts at Citi.
On Thursday, Saudi investor Saad Group, a long-term shareholder, said it had sold a further 4.5 million shares in Berkeley, taking its stake to just 2.73% from 29%.
"The balance sheet is not exposed," said Pidgley. The company said joint ventures with Saad were worth £18.7 million , "half of that is his, half is ours," said Pidgley. The company is currently in talks with Saad's advisors, which may involve Berkeley taking Al-Sanea's equity, he said.
Privately-held investment company Saad has said it is restructuring its $6 billion debts after it ran into difficulties earlier in June, prompting the Saudi central bank to freeze the accounts of its billionaire chairman, Maan al-Sanea
Recent data and trading updates from British housebuilders such as Taylor Wimpey show some stability has returned to the sector.
Berkeley said transaction levels improved in the past quarter with sales prices stabilising, but mortgage approval levels remain at historically low levels.
"They (banks) are rebuilding their balance sheets. I think that's going to go on for a while," said Pidgley.
Rising unemployment is another factor. The Organisation for Economic Cooperation and Development recently said British joblessness was set to rise towards 10% in 2010 from 7.2%, putting further pressure on the housing sector.
Berkeley said Victoria Mitchell would step down as chairman in September whilst Perrins will be succeeded by Nick Simpkin as finance director.
Fri, 26th Jun 2009