Major homebuilder Cala records £1.36bn turnover and pre tax profit of £169m for FY 22

Kevin Whitaker (CEO at CALA Group)

CALA Group (Holdings) Limited, one of the UK’s leading homebuilders, has today issued preliminary results for the twelve months to 31 December 2022, ahead of audited accounts to be finalised in March. 

Financial highlights

–          Strong trading performance, delivering revenue of £1.36bn, a 9% increase on 2021 (£1.24bn)

–          Homebuilder anticipates pre-tax profit of c. £169m, a significant increase of 27% on 2021 (£132.7m)

–          Total home completions of 3,027 – 4% up on the 2021 total of 2,904 units

–          Sales per site per week across the 12 months were 0.62 compared to 0.76 achieved in 2021 (as a result of a material change in sales rates in the final quarter of 2022, following the UK Government’s mini budget)

–          The business recorded an uptick in private average sales price (ASP) to £492,000, up from £462,000 in 2021, as a result of sales price growth and the mix of sites sold during the year

–          Cala entered the new financial year with 751 forward private reservations equating to £396m Gross Development Value (GDV), (2021: 994 units, £488m GDV)

Kevin Whitaker, CEO at Cala Group, said:

“Cala has delivered an excellent performance across 2022, achieving significant increases in revenue and pre-tax profit. This was attained through an increase in new home completions, strong sales price growth and the mix of homes sold during the year.

“We benefited from excellent market conditions in the first nine months of the year. During the final quarter of 2022, the impact of the UK Government’s mini budget on the financial markets directly influenced buyer confidence. This has naturally affected sales rates in recent months and has impacted the strength of our forward sales position. 

“2023 will be challenging for everyone, due to the increased financial pressures associated with higher living costs and mortgage repayments. Cala is well-placed to navigate the changing market conditions with the backing of our owners, Legal & General, alongside the talent, commitment and quality of our teams.

“The fundamental shortage in the supply of new homes continues to support new build delivery. In a more selective market, the quality of design and construction of Cala’s homes, alongside industry-leading customer service, continue to attract home buyers.

“Now more than ever, against the backdrop of increased fuel costs and reduced availability of secondhand homes, new homes offer a great alternative. Excellent energy and thermal efficiency help minimise energy use, while facilitators like part exchange support customers through their move.”

Strong performance for 2022

Strong market conditions in the first nine months of the year enabled Cala to sell out for 2022 in September, securing an excellent year of trading overall. Increased turnover and the highest pre-tax profit recorded by the homebuilder were delivered as a result of increased new homes completions and a significant uplift in ASP.

Sales per site per week over the 12-month period of 0.62 were down compared with 2021 (0.76). This reflects a reduction in sales rate during the final quarter of the year, when changes in the mortgage market, triggered by the UK Government’s mini budget, began to affect buyer confidence.

As at the 31st of December 2022, private forward reservations were 751, equating to £396m GDV. This was down from £488m GDV and 994 units in 2021, reflecting the more challenging market experienced in Q4 of 2022.

Laying the foundations for a sustainable future

The land market has been highly competitive throughout 2022 and Cala has taken a selective approach, focusing on high-quality developments in desirable locations. During the 12-month period, Cala contracted 22 new short-term developments, expected to deliver 3,270 homes with an anticipated GDV of £1.3bn. Cala will continue to grow and strengthen its landbank throughout 2023.

Cala is making steady progress towards achieving its targets of building homes for its customers that are operationally net zero carbon enabled from 2030 and reaching net zero greenhouse gas emissions in line with the Scottish Government’s 2045 target and ahead of UK Government’s 2050 target. 

Building on our existing commitment to meet net-zero operational greenhouse gas emissions by 2030, Cala has established net-zero road maps for each regional business to identify and schedule priority actions.

Outlook for 2023

The market in 2023 will be challenging given increases in mortgage rates, alongside the increased cost of living for all. The Group is well-placed to manage through changing market conditions with owners Legal & General, an experienced management team and the talent and commitment of its hard-working people.

The fundamental shortage in the supply of new homes continues to support new homes delivery and strong levels of interest continue through Cala’s website, as buyers remain attracted to Cala’s outstanding quality of design and construction, alongside industry-leading customer service. 

In addition, the energy and thermal efficiency of new homes, coupled with the range of ways Cala can reduce the cost and uncertainty associated with moving home, such as part exchange, will continue to support sales throughout 2023.

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