Abbey parent company warns on economic outlook

The parent company of housebuilder Abbey has reported healthy profit and turnover growth in the year to April 30 2022, but warned that economic conditions will impact its current financial year.

Gallagher Investments Ltd reported pre tax profit of £73.8m, up 23% on the previous year, on turnover of £288m, up 9%.

Gallagher Investments, which took the formerly AIM-listed Anglo-Czech housebuilder Abbey private in 2021, also owns a plant hire business and commercial property rental.

It said its housebuilding operations made sales of 642 homes, of which 533 were in the UK, up from 607 sales in the previous year. Housebuilding accounted for £203m of the turnover, it said.

The companies’ net assets increased from £466m in April 2021 to £518m last year. The results follow the firm, which builds homes predominantly in the South east of England, reporting an 84% rise in profit in the previous year in the wake of the covid-affected 2020 period.

The firm said in statements filed at Companies House that the increase in turnover and net profit were “substantially due to the impact of Covid-19 in the prior year and the national lockdowns and associated restrictions”, adding that economic uncertainty had a “minimal” impact on profitability.

However, it added that “the directors […] feel the current economic forecast will no doubt impact the performance of the group in the current year.

“With the withdrawal of “Help to Buy” in the UK, stamp duty restored to the full rate, rising interest rates together with high cost inflation, this will impact margins across the group.”

The firm added the group was in a “strong financial position” to withstand economic uncertainties.

Gallagher Investments Ltd is a development vehicle set up by Charles Gallagher, thought to be one of UK construction’s richest men, with a fortune estimated at £669m in this year’s Sunday Times rich list.