SCOTLAND’S only quoted housebuilder has seen the sharp recovery of home completions and cashflow following the prolonged Scottish construction lockdown, with delayed sales fuelling what the company predicts will be a strong first half to the current financial year.

Springfield Properties, the Elgin based AIM-listed housebuilder providing private and affordable housing, said in its annual results to May that revenue was at £144.4 million against £190.8m last year and adjusted profit before tax was £10.2m, against £16.5m.

The group’s results were impacted by the delivery of handovers scheduled for April and May being delayed because of the Covid lockdown. For the previous two years, these months had accounted for 30 per cent of the group’s annual revenue, it said.

The market has seen significant activity post-lockdown as it moves to meet “pent up demand”.

READ MORE: Scottish housebuilder Springfield Properties achieves record reservations for a single week after reopening

Innes Smith, chief executive of Springfield Properties, said: “During the year, ahead of the Covid-19 pandemic, we were delivering on our strategy, with notable successes across the business. We progressed the development of our large, high-quality land bank and expanded geographically.

“We continued to deliver great places to live against a backdrop of sustained demand for housing in Scotland. As a result of the lockdown, the completion of homes scheduled to take place in April and May 2020 was postponed into 2020/21, however, with these sales under contract, we were able to complete the homes for handover to our customers early in the current financial year.”

Mr Smith also said: “Since resuming operations, we have seen a strong increase in demand, with private reservations 24% above the same period last year.

“This reflects both the pent up demand and the increasing desire for buyers to move out of city centres and into larger homes with gardens, which is the type of home that Springfield offers.”

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Analyst Alastair Stewart, of Progressive Equity Research, said: “Springfield’s results were hit by the duration, severity and timing of Scotland’s lockdown.

“England’s lasted from March 24 to May 13 and, even then, allowed limited activity on site, while Scotland’s sites and sales offices only fully reopened by the nd of June, after a stricter lockdown.

“Springfield’s year end of May, in our view, exacerbated the impact on full year 2020 results, since 30% of its revenue in the previous two years were generated in April and May. Predominantly English housebuilders with June period ends benefited from a shorter shutdown, with most of May and June to recoup some of their lost revenue.”

The total number of home completions for the year to May fell by 24%, and revenue also fell by 24%, however gross margins increased during the year, limiting the fall to £10.2m.

Mr Stewart said: “We believe that, once the logistical obstacles from coronavirus normalise, the Scottish housing market should offer significant growth in volumes and prices, due to relative undersupply. Springfield’s proactive multi-tenure model was strengthened by last year’s collaboration with Sigma Capital, which offers growth with modest capital requirement.”

Sandy Adam, Springfield chief financial officer, said: “These are turbulent times for all businesses but we have navigated through rough seas before and it is at these times that opportunities come along to grow our businesses, so we will be watching out for these opportunities and taking them when we can.
“The outlook for us is cautious optimism.”

Shares closed at 96p, up 12.94%.