Berkeley Share Discussion Threads

[jrphoenixw2] 21/6/2017 07:14

'At the half year, Berkeley introduced flexibility to the delivery of its Shareholder Returns Programme so that future returns could be made from either dividends or share buy-backs. Since then we paid the £1 per share announced in December on schedule in March, equating to £138.8 million; £117.7 million as dividend and £21.1 million through share buy-backs. In February, we announced that the next £138.8 million (£1 per share) will be returned by 30 September 2017, again through a mix of dividends and share buy-backs. To date, £23.2 million of share buy-backs have been made against this commitment.'

[---> Suggesting 16.71p/100p of the next div has gone on buy-backs to date]

'Since the interim results announcement on 2 December 2016, Berkeley has spent £44.4 million on share buy-backs across 1.53m shares, at an average cost of £28.96 per share (range: £28.08 - £30.97 per share). When combined with dividend payments of £117.7 million in March, £21.1 million of this was part of the £138.8 million announced in December 2016 to be returned by 31 March 2017. The remaining £23.3 million will contribute to the £138.8 million returns to be made by 30 September 2017, as announced on 23 February 2017. The amount to be paid as a dividend will be announced on 17 August 2017 and payable on 15 September 2017 to shareholders on the register on 25 August 2017, taking account of any further share buy-backs made in the intervening period.'

[jrphoenixw2] 21/6/2017 07:09

HIGHLIGHTS
· Profit before tax £812.4 million; up 53.0% (2016: £530.9 million)
· Net cash £285.5 million (April 2016: £107.4 million) after dividend payments of £254.6 million and share buy-backs of £64.5 million
· Net asset value per share Up 18.4% to £15.56 (April 2016: £13.14)
· Forward sales £2.74 billion (April 2016: £3.25 billion)
· Land bank £6.4 billion of estimated future gross margin (April 2016: £6.1 billion) across 46,351 plots (April 2016: 42,858 plots)
· Investment Sixteen sites added to land bank, including five contracted in the St William joint venture
· People Over 13,000 people working across our sites, including over 650 apprentices in the year

The housing market has stabilised in London and the South East but, while Berkeley is in excellent shape with further additions to our unrivalled land bank in the period, it is an inescapable fact that we are facing a number of headwinds and a period of prolonged uncertainty. Brexit and wider global macro instability impact both confidence and sentiment and will result in constrained investment levels. At the same time, the headwinds from changes in recent years to SDLT and mortgage interest deductibility, coupled with the planning environment's increasing demands from the combination of Affordable Housing, CIL, Section 106 obligations and review mechanisms, are resulting in reduced levels of new housing starts in London.

For Berkeley, this leads to greater uncertainty around the timing of delivery of homes from our land bank but will not change our absolute focus on the quality of the homes and places we create. Notwithstanding the uncertainty, Berkeley's strong forward sales position and land bank provide sufficient visibility to reiterate its previous guidance of delivering at least £3.0 billion of pre-tax profit in the five years beginning 1 May 2016, assuming prevailing market conditions persist.

[etc etc]

[jrphoenixw2] 21/6/2017 07:06

FINAL RESULTS ANNOUNCEMENT
Outstanding balance sheet strength with cash due on forward sales of £2.74 billion, estimated future land bank gross margin of £6.4 billion and net cash of £285.5 million
On target to deliver at least £3.0 billion of pre-tax profit in the five years Beginning 1 May 2016, with £812.4 million delivered in this first year
More than £0.5 billion of subsidies provided to deliver affordable housing and wider community and infrastructure benefits in the year
£8.34 per share already returned or announced to be returned by September 2017 under Shareholder Returns Programme, with remaining £8.00 per share (£1.1 billion) scheduled to be delivered evenly over the following four years
[continues]

[jrphoenixw2] 20/6/2017 10:49

I was looking around to see if I could find any data on his longs. Closest I got was this from Zerohedge last October based on data at end-July 2016.
Odey's biggest position then BY FAR was long gold - 'Mr Odey’s single biggest bet is that the value of gold will surge. This gold position represents an eye-watering 100 per cent of his fund’s net asset value' [continues]


@ end July-2016 gold was at circa $1370. It's only dropped since. Today it's circa $1248.

How he remains solvent, esp writing fat divs on BKG and Lancashire/LRE etc I don't know!

[jrphoenixw2] 20/6/2017 09:57

Yep, tricky to divine I'm sure. I can see you could perhaps make a case with Brexit fears in BKGs prime/international London/SE market + vicious stamp duty to short it vs a lower px-point regional builder. But the rumoured results don't bode well for shorts and the cost-of-carry (div) make shorting it an expensive bet - all just IMV.

Interesting anecdote. Perhaps these days less people have time or a record in doing their own DIY/redecs etc, and so can't recognise shoddy vs properly done. And if buying to renovate/redecorate isn't an option you're left with whatever new build is on offer...

ps. FWIW I think it gapped-higher on the open. Prior close @ 3260 vs open this morning @ 3266

[raffles the gentleman thug] 20/6/2017 09:35

I went to view some Crest Nicholson new builds over the weekend and was just amazed with a capital A how shoddy and low end the finish was compared to what BKG deliver at comparable price points. I just continue to be astounded how undiscerning the average house buyer seems to be

[raffles the gentleman thug] 20/6/2017 09:33

I don't actually know in this case Phoenix but he like majority of equity long short hedge funds are largely sector neutral engaging in pair trading, and I suspect the losses this particular firm has endured are a real limitation on him taking much directional sector risk.

[jrphoenixw2] 20/6/2017 09:28

I take your point, there is always an 'if'. Can you give a suggestion of what he might have paired it with? It'd be interesting to see a worked example together with the dividend stream.
Here are his notified shorts hxxp://shorttracker.co.uk/manager/ODEY%20ASSET%20MANAGEMENT%20LLP/all

[raffles the gentleman thug] 20/6/2017 09:23

Well it's not ouch if he's paired long something better in the sector which is his usual investment strategy

[jrphoenixw2] 20/6/2017 09:09

Odey went from -0.71% > -0.94% on 13th June. Close price on that day = 3176p.
Price at time of writing = 3311p = -4.25% in under a week, and short the running div @ circa 6.1%
Ouch.

ref:

[jrphoenixw2] 19/6/2017 15:49

Thanks, I'd forgotten that tip!

[2350220] 19/6/2017 15:32

Ta jrphoenixw,
If ever you want to stop ADVFN from messing about with the web link, just type hTTp... rather than http.
And that seems to work.
All the best,
John

[jrphoenixw2] 19/6/2017 15:15

Perhaps he has been buying [nice!] as the website shows 6.04 million. hxxps://www.berkeleygroup.co.uk/investor-information/directors-shareholding
He co-founded the company, hxxps://www.berkeleygroup.co.uk/media-centre/biographies/tony-pidgley and since in recent decades execs at his level get paid such a high proportion of stock/options/long-term incentive schemes vs cash, then it's unsurprising that the top people of successful companies can build up big holdings.

Good luck to him, he's fully aligned with our goals I reckon :)

Note: URLs have been auto-changed as sometimes happens. If necessary amend the 'hxxps' to 'h t t p s' [no spaces].

[2350220] 19/6/2017 14:27

Blimey, just did some simple maths and it looks like the boss has about £200m of shares, if I've done my sums correctly
Tony Pidgley ..... 6,368,153 shares Wow.

John

[jrphoenixw2] 19/6/2017 11:14

Just noticed BKG results were mentioned in an article in the Telegraph late last night; excerpt:

'London-focused Berkeley Homes is on track to report soaring profits in its full-year results this week despite a slowing market in the capital. Estimates suggest that the housebuilder has made £772.6m in pre-tax profit, an increase of 61pc year on year. In its last trading statement, the FTSE 100 company said its profits would be at the higher end of analysts’ expectations, despite reservations for its properties falling by 16pc between August last year and March. The company also slowed down its building starts by 30pc between last August and March compared with the same period in the previous year. It blamed uncertainty over Brexit, as well as new affordable housing obligations.'

[dr_smith] 19/6/2017 09:36

Thank-you too R Ball from me.
Haven't come across Investegate before.
Usualy use "This is Money" but if I miss latest news on day, I have no way to see what I have missed, so Investegate (oddly spelt with "e" for "i") will be a great time saving tool.

[jrphoenixw2] 19/6/2017 09:01

Thanks RBall, I'd forgotten that that site is the go-to for results.
Re: '23s' snip re: potential results. +58% Y-o-Y that would be quite something after all the doom/fear. If that figure is correct it's going to be interesting to see where the jump came from.

[r ball] 19/6/2017 08:35

Will Wednesday be the last hoorah! Tempted to sell last Monday but this one is getting a bit close to call.

[2350220] 18/6/2017 12:38

Tiny piece in the Sunday Times today,
on pg2. Extract :
"Housebuilder Berkeley is set to shrug off the downturn in London's property market with bumper annual profits.
Pre-tax profits climbed to £757m compared with £480m a year ago."

John

[r ball] 16/6/2017 18:45

7:00. I use investegate for release news. Free.

[jrphoenixw2] 16/6/2017 14:48

Finals due on Wednesday 21st, presumably pre-8am / pre-open.

[x-ref FWIW discussion of final result actuals in June last year began at post no.1532]

[jrphoenixw2] 14/6/2017 12:29

Doesn't sit well does it?
WCC under the Tories sell off vast amounts of council etc housing.
WCC under the Tories force people buying new-build property in the borough to subsidise the people who previously would have been housed in council housing.

[fenners66] 14/6/2017 10:41

How much cash?

Cash starved local authority turns down money and chance of raising more council tax revenue from more , high band housing ...... that's going to fly when it comes to not having enough money to spend on public services...

[jrphoenixw2] 14/6/2017 09:50

Re: WCC I take it this is in reference to an article in today's FT, quoting Nickie Aiken, Westminster council leader.
Except:
'“My view is that too many times we have not always pushed back enough in requiring affordable homes on-site, have buckled on viability or surrendered to the idea that brutal market economics simply denies housing opportunities for most people and that is just a harsh fact of life,” she said.
Many councils have started accepting cash payments in lieu of developers building affordable housing in recent years. Westminster council will publish a new statement this week on planning policies to improve housing delivery. That will include an expectation that more affordable housing will be built: “We don’t want cheques any more, we want to see housing — we are going to get tough,” said a spokesman.

Article titled: 'Westminster council issues warning to property developers'

[r ball] 13/6/2017 20:14

Headwinds: Westminster councilAnnouncement today, brexit, interest rates. Time to reduce exposure? Ps: I've held since 2010...