Springfield Properties revenue soars to record £257m

Elgin-based Springfield Properties, which is building a number of new communities throughout Scotland, said its revenue increased 18.6% to a record high of £257.1. million in the year to May 31, 2022.

Springfield, Scotland’s only listed house builder, said the revenue “reflected strong growth across private, affordable and contract housing as well as the results including a six-month contribution from Tulloch Homes, which was acquired during the year.”

Statutory profit before tax rose 10.1% to £19.7 million. Dividend rose 8% to 6.20p. Springfield shares rose about 4% to £1.15 to give the firm a stock market value of around £136 million.

Springfield said its total land bank was 16,652 plots at year end with gross development value (GDV) of £3.5 billion.

Post reporting period, Springfield said it acquired the Scottish housebuilding business of Mactaggart & Mickel, a premium brand housebuilder with a land bank in “highly desirable locations within the Central Belt of Scotland, expanding the group’s footprint in areas with a higher price point …”

Springfield completed 1,242 homes in the year, an increase of 27.6% from the 973 completions in 2021, marking the first time Springfield has delivered over 1,000 homes in a single year.

The group also delivered its first PRS (private rented sector) housing, which further diversifies its revenue streams.

However, Springfield added: “Notwithstanding delivery of the contract at Bertha Park, the group’s strategy to expand its PRS activity with Sigma is currently on hold due to emergency legislation that is being introduced in Scotland, as announced earlier this month, to protect tenants by freezing rents and imposing a moratorium on evictions until at least 31 March 2023.

“This is a temporary measure designed to support families facing fuel poverty this winter, and Springfield continues to believe that the delivery of PRS housing offers a viable revenue stream in the longer term.

“Whilst this does not impact the group’s existing agreement to deliver 75 PRS homes, any decisions on the expansion of this activity will wait until the policy environment is clearer.”

Springfield Properties CEO Innes Smith said: “This year we achieved our highest ever annual profit and revenue with strong results across private, affordable and contract housing.

“I am pleased at how we managed the material and supply chain pressures facing our industry so that, while not immune, we were able to mitigate much of the impact.

“In keeping with our strategy, we significantly expanded our business with the acquisitions of Tulloch Homes and, post period, the Scottish housebuilding business of Mactaggart & Mickel – two high quality housebuilders with land in areas of strategic importance.

“We also achieved a milestone with the delivery of our first housing for the private rented sector.

“We entered the 2023 financial year delivering against a strong order book in private housing, reflecting sustained demand for the type of homes that we provide and the expansion of our business.

“We have excellent visibility over full year private revenue forecasts based on homes delivered, missived and reserved.

“While the challenging economic backdrop will impact our affordable and PRS housing activity in the short term as we await decisions from the Scottish Government, we are on track to deliver another year of revenue and profit growth overall.

“Moreover, the fundamentals of the housing market in Scotland remain strong with high demand for homes across all tenures coupled with a national shortage in housing supply.

“As a result, the board continues to look to the future with confidence and to delivering sustainable value for all of our stakeholders.