Mactaggart & Mickel Group sees profits soar as it returns to pre-recession form

Mactaggart & Mickel Group, the award winning Scottish family housebuilder, has published strong results for the year ended 30 April 2014.

Group turnover is up 8% to £58.5 million (2013: £55.5 million) with profits before tax soaring 233% to £8.1 million (2013: £2.4 million). Strong sales from the Homes division, company-wide efficiencies and the sale of non-performing assets saw the business return to pre-recession profit levels.

Operational highlights include:

  • Homes – The division delivered turnover of £44 million and gross profit of £10.7 million with 133 completions for the year – nearly 10% ahead of target. Three new developments were launched in Dalkeith, Milngavie and Bishopbriggs in addition to new phases at three established sites. At year end, forward sales for FYE April 2015 were at 54 per cent of the target.
  • Timber Systems – Investment in factory automation and a management restructure have left Timber Systems well placed to drive growth in the coming year. Despite a decline in profit, strong growth is projected for the next financial year with a number of contracts already secured.
  • Contracts – Profit increased substantially to £3.2 million (2013: £1.2 million). The division handed over its biggest project to date – the Athletes’ Village – on time and on budget. It also increased its presence in the social housing market working with organisations like Falkirk Council and West of Scotland Housing Association; a healthy pipeline includes projects for East Ayrshire, East Dunbartonshire and East Renfrewshire Councils.
  • Commercial Property – Income and profit increased steadily. Retail developments in Airdrie, Ayr and Dalkeith have secured quality tenants including Tesco, Sainsbury’s, the Co-operative and William Hill. Overall asset value currently stands at £7.5 million.
  • Lettings – Income increased modestly to £3.3 million. The National Housing Scheme project at Carrongrove has added 27 properties to the portfolio which are now fully let. Three properties were sold on with a capital income of £0.4 million.
  • Strategic Land – The Group completed its first English land sale contract for 200 new homes in Shavington, Cheshire. Planning applications are now lodged for 1,023 units and its English land bank has increased to over 1,300 acres across 20 projects.

Chief executive Ed Monaghan commented:

“This is the third year of our five year plan and our focus has been on improving efficiency and effectiveness, the results of which are clearly demonstrated by the significant upturn in profit.”

“Our Homes division has enjoyed a strong performance as confidence returns to the market with sales and footfall increasing consistently. We have to acknowledge the role Help to Buy (Scotland) has played in this, accounting for 11% of purchases. With this pattern continuing well into the current financial year while funding was still available, it highlights how crucial initiatives that stimulate the market are to the industry.”

“Social housing has been another key growth area for us with new partnerships with housing associations and local authorities demonstrating our ability to blend private sector innovation and expertise with the value for money requirements of public sector working.”

“Our diversification strategy is bearing fruit but some of our most successful projects have integrated the specialist skills of several of our divisions, again showing the strength of partnership working to deliver an exceptional financial performance.”

Mactaggart & Mickel Group was named Housebuilder of the Year for the second consecutive year at the 2014 Homes for Scotland Awards in addition to securing the Best Medium Development for its innovative Polnoon site in Eaglesham, built in partnership with the Scottish Government. Site manager Stuart Gillespie, based at Greenan Views in Ayr, was recognised as the best in the UK in the Medium Builder category at the National House Building Council’s Pride in the Job Awards, considered the ‘Oscars’ of the industry.