Bellway sales down by two-thirds since lockdown

Sales at housebuilder Bellway have fallen by more than two-thirds since the imposition of lockdown, the firm said in a trading update today.

The business said demand was now gradually picking up given the reopening of sales centres, but that it still expected “year-on-year sales activity to be severely constrained until a time when ‘lockdown’ restrictions are further lifted.”

Bellway said it had taken 71 reservations per week in the period from March 23 to the end of May, compared to 231 per week in the equivalent period last year – a fall of 69%.

The firm struck a notably more cautious tone than Taylor Wimpey, which updated the market on trading during the covid lockdown last week by saying that it was seeing strong demand for homes and was selling at well over half the normal rate.

In contrast, given the ongoing covid-19 restrictions, Bellway today said land buying remained on hold “in general”, financial guidance remained suspended, and it had temporarily abandoned plans to open new divisions.

However, over the financial year so far Bellway said it had sold 6,721 homes in the nine months from August 2019 to the end of May, a drop of just 12% on the previous year, while its order book remained “substantial”, down by less than 5% on the prior year at 6,038 homes.

It said construction work had now restarted on 230 sites, equating to around 85% of the number it was working on prior to lockdown. It said that “work is still primarily limited to those homes which are nearing completion” and that productivity was “reduced” by the fact only one tradesperson is allowed in any house at any one time.

Bellway said that all showhomes and sales centre have now reopened, and its debt remained below the level seen at the same time last year.

Jason Honeyman, chief executive, said the firm’s “measured approach” had enabled it to “continue serving our customers and has facilitated the safe return to work for many of our employees.”

The update added: “The resumption of build programmes should enable Bellway to slowly increase the number of completions throughout the late summer and autumn months”, and that its response to the covid outbreak, sizeable forward order book and strong balance sheet “should ensure that Bellway remains well positioned to emerge positively from this period of uncertainty.”