Bellway (LSE:BWY) on Tuesday reported full-year revenue of £3,162.2m for the year to 31 July, up 13.6% from £2,782.8m, as total housing completions rose 10.8% to 9,695 homes.
The London-listed housebuilder's underlying operating profit climbed 5.6% to £320.6m from £303.5m, though the underlying operating margin slipped to 10.1% from 10.9%, reflecting increased sales incentives and a greater contribution from lower-margin bulk sales.
Reported profit before taxation rose to £270.2m from £221.9m, while underlying profit before taxation increased 5.7% to £305.7m. Adjusted operating cashflow jumped 36% to £868.6m, which Bellway attributed to disciplined management of work-in-progress and a focus on capital efficiency.
It ended the year with net cash of £157.7m, reversing net debt of £41.8m a year earlier, and adjusted gearing, including land creditors fell to 3.0% from 8.3%. The board proposed a total dividend of 75.0p per share, up 7.1% from 70.0p, and announced a further £150m share buyback for FY27, on top of the £150m programme completed in August.
Taken together with the first £75m tranche of the new programme, Bellway expects dividends and buybacks across FY26 and FY27 to total around £450m.
Chief executive Jason Honeyman said Bellway had "delivered a robust performance, growing both volume output and profits despite ongoing challenges across the housing market," crediting operational improvement and capital efficiency for the cash generation.
The private reservation rate excluding bulk sales fell to 0.49 per outlet per week from 0.52, and the forward order book at 2 October stood at 4,981 homes worth £1,437.6m, down from 5,285 homes worth £1,526.9m a year earlier.
That weaker order book, alongside persistent affordability pressures and mortgage rates above prior-year levels, has led Bellway to guide for total completions of between 9,000 and 9,400 homes in FY27, down from 9,695 this year, including an increased 615-home contribution from bulk sales.
The company expects its average selling price for FY27 to be broadly similar to the FY26 level, at around £325,000, while the underlying operating margin is expected to reduce further as build cost inflation, elevated incentives and a higher proportion of bulk sales outweigh land bank and efficiency gains.
Bellway expects overall build cost inflation of around 3% to 4% in FY27, after cost pressures intensified in the second half of the year on higher material and energy prices.
The group's land bank stood at 94,666 plots at year-end, down slightly from 95,704, with the strategic land bank maintained at 48,000 plots, more than half of which carry positive planning status.
Honeyman said Bellway welcomed the government's proposed Your First Home scheme for first-time buyers, adding the company "has the financial strength, operational capability and land bank to respond as market conditions improve."