By Scott Wright
MACTAGGART & Mickel, the historic Scottish housebuilder, has hailed its performance amid “unprecedented uncertainty”, as profits fell in its most recent financial year.
The Glasgow-based company delivered a pre-tax profit of £12.1 million in the year ended April 30, down from £14.3m.
Chief executive Ed Monaghan declared he was “delighted with the numbers” for a period which saw Mactaggart & Mickel bring its first homes to market in England.
The company, founded in 1925, built a total of 225 homes over the year, up from 196, which helped lift turnover to £84.7m from £82.3m. The average selling price edged up to £322,000 from £319,000.
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More than 60 of the homes built during the period were in the affordable housing sector.
Referring to the ongoing Brexit discord, Mr Monaghan said: “From our perspective, we have been operating in a period of unprecedented uncertainty. That, by definition, has just created a little bit more buffering in the sales pipeline.
“But I have got to say, against a background of that – and we are not a unique sector in that regard – we are delighted with the numbers that came through at the end of the day. [We are] looking for more certainty ahead.”
Mr Monaghan said the firm has Brexit contingency plans in place, which would see it use alternative sources of raw materials if there is any disruption to its supply chain.
So far there has been no disruption, but he expects the uncertainty to continue even if a Brexit deal is approved by the UK Parliament. “That is just one part of the process that gets us to the departure,” he said. “It feels to me we are at the start rather than the end.”
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Mactaggart & Mickel launched several new housing developments during the year. In Scotland, it began work at Stewart Gardens in Newton Mearns and refurbishing the B-listed Carrongrove House, near Denny in Falkirk, which has been converted into seven luxury apartments.
The firm simultaneously continued its push into England, with its first development, St Jude’s Meadow at Milton-under-Wychwood, coming on to the market. Mr Monaghan said it was a “landmark” moment for the business and will be followed shortly with a second site, Childrey Park in East Challow. Two further sites in Oxfordshire are on course to be launched next year.
Asked whether sentiment among the house-buying public is being affected by the political uncertainty, which has been given an added layer with the forthcoming General Election, Mr Monaghan said: “We still get good quality prospects from people who are in the market, and that gives us confidence.
“Invariably, there is still continued demand for housing, and that is a big component to what we do, notwithstanding the challenges on securing planning and all the other necessary consents to get us on site.
“The demand is there, it is still very strong, and customers and clients still need to move. All of that is positive.”
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The company, meanwhile, invested in two commercial properties in New York, its first outside the European Union, as part of efforts to diversify its portfolio and generate additional revenue streams. The deals came about through dialogue with Mactaggart Family & Partners, the property firm which split from Mactaggart & Mickel in 1943.
That relationship led to a joint investment by the two, alongside Rennick Property and Millard Estates, in commercial properties in Edinburgh’s New Town, last month. Mr Monaghan said he hopes to other ventures with Mactaggart Family will follow.
Mactaggart & Mickel also made further investment in its private rental sector (PRS) portfolio in London during the year, largely in New Cross.
The company, which owns PRS properties in Glasgow and Edinburgh, has now invested £70m in England to date.
Rental income from commercial property dipped from £400,000 to £200,000, though the firm highlighted the “milestone” of securing planning permission for a project in Corstorphine, Edinburgh. The St John’s Road proposals will feature retail space, 36 apartments and townhouses.
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