Cruden doubles profit in year of improvement – Daily Business

Fraser Lynes: making progress

Scottish housebuilder Cruden has reported a significant improvement in performance for the year ended 31 March, with profit before tax and exceptional items more than doubling.

Total turnover, including Cruden’s share of joint ventures, increased to £134 million, from £112m in the previous year, while profit before tax and exceptional items rose to £6.1m, compared with £2.8m.

Cruden saw good progress in core housebuilding activities following its strategic focus on increased private development and partnership-based affordable housing and a move away from price-led tendered construction.

Private home sales increased by more than 20% to 148 homes, from 121 in the previous year. The average selling price was £311,000, compared with £347,000, reflecting the mix of homes sold and a greater proportion of value-focused family homes.

The group also strengthened its financial position, with net assets increasing to £48.7m, from £42.6m, and net cash reserves rising to £21.3m, from £18.4m. Cruden also retains its undrawn £9m revolving credit facilities at the year-end. 

Fraser Lynes, chief executive, said: “These results demonstrate the progress we are making and, importantly, show that our strategy is translating into stronger financial and operational performance.

“We have been very deliberate about how we want to grow Cruden. We are increasing our private housebuilding activity while focusing our affordable housing business on land-led developments and genuine partnerships where our development expertise can add real value.

“We are now seeing the benefits of that approach through increased home sales, improved profitability and a strong pipeline that gives us visibility over the next phase of growth. There is still a great deal to deliver, but we have entered the new financial year with real momentum and a clear sense of direction.”

Cruden’s acquisition strategy is increasingly focused on securing larger developments that provide greater pipeline certainty and several years of housing supply in individual locations, supporting its ambition to progressively increase the number of homes it delivers.

“Growth for us isn’t simply about getting bigger,” said Mr Lynes. “It’s about choosing the right developments, working with the right partners and delivering high-quality homes and places that customers and communities value.”

Cruden Homes development in Barnton, Edinburgh

Cruden currently has a development pipeline of more than 3,500 homes, spanning private and affordable housing. The pipeline combines major regeneration and placemaking opportunities with larger family housing developments and the continued expansion of Cruden’s private housebuilding activities into new geographical markets.

At Granton Waterfront in north Edinburgh, Cruden is contributing to one of Scotland’s most significant regeneration programmes, delivering over 800 homes in the first phase, while The Village at Dalmarnock builds on Cruden’s longstanding involvement in the area following its completion of the award-winning Athletes’ Village for the Glasgow 2014 Commonwealth Games.

New developments, Neukhaven Green in Pittenweem and Stonefield Brae in Neilston, further strengthen Cruden’s regional presence, supporting growth in carefully selected markets across Scotland. Collectively, these projects reflect the business’s disciplined approach to expansion, placemaking expertise and commitment to delivering much needed homes in locations with strong long-term fundamentals.

In November last year, BGF, one of the UK and Ireland’s largest and most experienced growth capital investors, acquired a minority stake in Cruden. This represents the first external investment in the business, and a significant endorsement of Cruden’s growth ambitions, leadership strength and long-term vision for the future.

Despite continued economic uncertainty, interest rate pressures and challenges around planning and public sector funding, Cruden said the fundamental shortage of housing across Scotland continues to underpin long-term demand.

The business intends to progressively increase the number of private homes it sells while continuing to grow its affordable housing activities and pursue opportunities across different tenures, including build-to-rent.

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