Weston Group, the volume housebuilder, serviced offices and logistics group, has announced pre-tax profits of £35.2 million, forward sales of £248 million and £28 million of new investment in infrastructure, logistics and staffing. The Group’s on-target results are due to strong sales for starter and family homes and good occupancy figures for the serviced offices division.
Reporting on its 2017-2018 financial results, Weston Group highlighted that pre-tax profits were up 54.5% year-on-year whilst total revenue for the year was £257.1 million, up 29.4% yr-on-yr. Over the financial year, the Group’s residential development business delivered £248 million of forward sales from 954 units, with an average selling price of £329,000.
Weston Group has now expanded to have four operating divisions: Weston Homes, the residential development business; Weston Business Centres, the serviced offices division; the environmental consultancy business and Weston Logistics, the Group’s newly launched, 40 staff strong, logistics and plant hire business.
Operating on a 24.3% margin (up 1% on the previous year), the Group says that this year’s financial results are significantly up on 2017 and the firm anticipates further growth in 2019. Established in 1987 with headquarter offices in London and Stansted, Weston Group currently employs over 460 people, and has a development pipeline of 6,000 new homes, with a completed value of £2 billion. Due to this pipeline, the company is forecast to double in size over the next five years.
In order to facilitate future expansion, the Group is injecting £28 million in new investment into infrastructure, logistics and staffing. The firm has started construction on a new 49,000 sqft headoffice in Stansted; Weston Logistics has opened a new 75,000 sqft automotive-industry style Distribution Centre near its head office in Stansted and the Group has invested £1.5 million on recruiting and training new people.
The Group’s housebuilding division Weston Homes reports that one and two bedroom apartments in new build schemes in fast-growing urban locations such as Cambridge, Barking, Peterborough, Reading and East Grinstead were the units in highest demand. In each of these locations steady off-plan forward sales were generated.
Over the last 12 months the Weston Homes division reports that eight major developments have been 100% forward sold off-plan. At the company’s flagship Denham Film Studios scheme in outer London 90% of the apartments are forward sold and the first phase of houses are 30% forward sold. At Fletton Quays in Peterborough, the first phase of apartments is 50% forward sold, Langley Square in Dartford is 95% forward sold and the multi-million Docklands penthouse at Stratford Riverside has been sold, at a record price for the local marketplace.
The residential business reports that purchasers consist of a balance of UK and international buyers. Almost 40% of the Group’s sales over the last 12 months have been to first time or younger buyers, with 32% of sales through the firm’s highly successful Help to Buy scheme.
The company’s funding facility, provided by for banks - HSBC, AIB, Lloyds Banking Group and Bank of Ireland – has risen to £200 million, providing the facility with £90 million of headroom up to April 2020. This, combined with equity delivered by ongoing developments, provides the Group with the funding required to make substantial investment in new developments over the coming year. The Group will continue to focus on buying sites in outer London and South East England.
Alongside the residential development business, the revenue delivered by the Group’s serviced offices and environmental consultancy business is also up on last year. Weston Business Centres currently has 22 employees within their Takeley Business Centre and their Colchester Business Centre, offering in excess of 65,000 square feet of serviced office space. The Takeley Business Centre contains eight firms and has a 100% occupancy rate whilst the Colchester Business Centre contains 48 firms, with an 80% occupancy rate.
The Takeley Business Centre, which is currently shared the head office of Weston Group, will increase dramatically in capacity when Weston Group relocates to a brand new headquarters and the existing building is refurbished into a new serviced office offering. There are also plans for a third business centre / commercial offering in Barking. These future plans will effectively double the size of the existing Weston Business Centres division and the company plans to recruit more people to help manage the growth.
Bob Weston, Chairman & CEO of Weston Group, says: “Weston Group’s strategy is to expand in three sectors, growing our residential development business, expanding our serviced offices business and developing our new logistics division. In our residential development business homes priced from £300 to £800 per sqft, our core operating area, continue to benefit from steady and sustained demand. Our plan is for the Group to double in size over the next five years and we have a development pipeline of 6,000 new homes with a completed value of £2 billion. In order to facilitate this growth the Group is injecting £28 million in new investment into the business in the form of upgraded infrastructure, a new HQ and logistics warehouse and more staff employment and training.”
Stuart Thomas, Group Finance Director at Weston Group says: “Weston Group is delivering steady and sustained growth, with revenue and profits rising, putting the business in a very strong financial position. Over the next 12 months we will facilitate further growth through substantial investment in the business and acquiring more urban sites for development across outer London and the South East of England.”