Bovis to resume dividend

Published:  09 July, 2010

LONDON: House builder Bovis Homes said it will resume paying dividends at the end of the financial year as it posted solid trading in the first-half, leaving it on track to meet 2010 targets.

Bovis, one of the smaller listed house builders, said it completed 803 homes in the first half, up 6%year-on-year, and achieved cumulative sales for 2010 legal completions of 1,474 homes, compared with 1,364 at the same point last year.

Sales prices are ahead of its own expectations the company said.

Bovis said in a statement today: "Given the confidence the board has in the medium term prospects of the group arising from its investment in new land opportunities and the group's strong net cash position, the board intends to resume dividends at the end of the current financial year."

Merchant Travis Perkins also announced the resumption of dividend payments earlier this week.

Bovis, the first house builder to review its dividend policy since the collapse of the residential market, said it has added 1900 consented plots to its land bank since the start of the year, with the majority of plots in the south of England. It has also agreed to buy a further 2,500 plots.

Larger peers Persimmon and Taylor Wimpey reported improving sales in recent weeks after a slowdown around the time of the general election and emergency budget.

But new data on house prices shows a gloomy picture for the sector, with house prices falling for the third successive month in June according to mortgage lender Halifax, suggesting that a recovery in the sector has tailed off. House prices are expected to be flat over 2010 as a whole.

Shares in Bovis closed at 348.8 pence on Thursday, valuing the company at £450m.

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