Debt-free Springfield building more worker homes – Daily Business

Innes Smith: excellent progress

Springfield Properties, the Scottish housebuilder, has become debt-free and said it is receiving increasing demand from infrastructure companies to build homes for workers.

Its position on debt is “significantly ahead of market expectation”s of year-end net bank debt of £10m and is a substantial reduction from the group’s highest reported net bank debt of £93.4m in November 2023.

In a trading update it said this is down to cost discipline and working capital control. It also offers Springfield greater financial flexibility to capitalise on investment opportunities over the next two years.

The group said it had made excellent progress during the year to capitalise on the “substantial opportunities” in the North of Scotland, driven by the demand for housing to support workers employed on renewables projects.

It is receiving increasing interest from major infrastructure providers looking for worker accommodation.

It expects rising prices from this increased demand to mitigate cost pressures associated with the crisis in the Middle East.

Alongside this, it said the fundamentals of the housing market in Scotland remain strong. There is a critical undersupply of housing across all tenures and the newly formed Scottish Government has reinforced housing as a priority with £4.9bn of investment for affordable housing and £10,000 interest-free shared equity loans to First Time Buyers over the Parliamentary term.

The group expects to report revenue and adjusted profit before tax in line with market expectations, with total revenue for FY 2026 of approximately £245m.

In private housing, there was strong growth in the second half of the year compared with the first half reflecting normal seasonality, an increase in average selling price and the changing housing mix, resulting in year-on-year growth in private housing revenue.

In affordable housing, revenue grew year-on-year, as expected, as the Group delivered against its strong order book and continued to secure new contracts.

Innes Smith, chief executive, said eliminating bank debt had been a strategic priority.

“We have made excellent progress in delivering on our new strategy to focus on the North of Scotland, which is experiencing unprecedented demand for housing in response to major investment in energy security and renewable infrastructure.

“We have already reached an important milestone with our agreement with SSEN Transmission and we continue to see substantial opportunity in the region for the years to come.

“Our underlying business remains strong, with the achievement of year-on-year growth in private and affordable housing. We also continue to hold significant landholdings in areas of high demand. Accordingly, we continue to believe Springfield is well positioned for the future and we look forward to reporting on our progress.”

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