Berkeley Group shares down as profits drop

The price of shares in FTSE 100 property developer Berkeley Group (LON:BKG) dropped by 1.55% to 3,504p (as of 14:10 BST) after the company posted results for the year ended 30th April. Management said that pre-tax profits were at the upper end of expectations, but they only represented 79.3% of the previous year’s level.

Looking ahead, CEO Rob Perrins said: “Underpinning the market for Berkeley over [the last three years] has been robust demand for well-located homes, priced correctly and that are built to a good standard of quality within welcoming environments. We have invested in our brand, with our holistic approach to place-making, putting people, nature and the strength and wellbeing of the wider community at the core of every development plan. London remains a fantastic global City, a place where people aspire to live and work, and the UK continues to benefit from strong employment and low borrowing costs.

Berkeley starts the coming year from a position of strength, with net cash of £975.0 million, forward sales of £1.8 billion and an estimated £6.2 billion of gross profit in our land holdings, and this means we can look beyond the current period of uncertainty with confidence. However, like all responsible businesses who operate in cyclical markets, we have been, and will remain cautious in our investment in this environment, and this will determine the speed with which we deliver the value from our assets and invest in new opportunities“.