A trading update from house-builder MJ Gleeson today warns that its operating profit for the year to 30th June 2025 will be 15-20% below previous expectations.
It added that next year was looking tricky too.
鈥淭he pace of the housing market recovery has not been sufficient to offset the cumulative impact on Gleeson Homes' gross margin of a number of headwinds through the year.,鈥� the company said. 鈥淭hese include increased build costs, flat selling prices, the continued use of incentives and several bulk sale transactions.聽 Consequently, Gleeson Homes gross margin for the year will be circa 1% lower than previously expected.鈥�
It continued: 鈥淭he board's expectation that Gleeson Homes would deliver an overall operating profit in line with market expectations included the profit contribution from a disposal of one of Gleeson Homes' extensive land holdings in East Yorkshire. It is now not expected that this disposal will proceed and consequently Gleeson Homes anticipates reporting an operating profit circa 15-20% below current expectations.鈥�
It added: 鈥淟ooking ahead, a number of factors will continue to impact Gleeson Homes into FY2026, including planning delays which will see the business selling from fewer sites than previously forecast.聽 Gleeson Homes' gross margin in FY2026 is also expected to be circa 1% lower than market expectations.鈥�
Got a story? Email news@theconstructionindex.co.uk
