In a trading update for the last five months, Boot says that business continues in line with expectations. “Trading conditions have been stable with, if anything, a slight improvement in the group's land, property development and plant hire businesses.”
The construction business is “performing well in the challenging market place”, the company says, adding: “Competitively priced work is available and we are looking at alternative work flows where higher margins are achievable. Both Road Link A69 and our plant business are trading satisfactorily.”
Plant hire turnover is marginally ahead of the same period in 2010.
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A focus on cost control, coupled with property and land sales, has resulted in net cash of £16.5m, compared to net borrowings of £11.4m at 31 December 2010.
On the house building business, Boot says: “House builders have reported improving results, albeit on historically low volumes, though recovery remains slow reflecting the continuing lack of availability of mortgage finance. However, these trends mask the fact that underlying demand for traditional family housing remains buoyant in certain areas of the country. Acquisition demand for sites in these areas, with planning permission for this product, are highly sought after as the supply of sites remains very restricted, particularly under the current planning regime.”
The board’s statement concludes: “Overall, trends in our markets give us the confidence to be able to make managed risk investments in the expectation of generating satisfactory returns in due course. That said, the tentative recovery remains fragile and we continue to assume that it will likely be a drawn out and uncertain process.”
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