London-listed Irish property group Cairn Homes returned to profit during the first half of the year as it ramped up housebuilding activity locally.
Cairn, which last year became the first Irish homebuilder to float on the stock market since McInerney Holdings in 1997, recorded a pretax profit before exceptional items of €500,000 in the six months ending June 30th, compared with a €1.04 million loss for the same period a year earlier.
Revenue rose €16 million from €500,000, while gross profit increased to €2.6 million from €51,000.
Cairn, which recorded the largest Irish-related initial public offering last year when it made its £400 million debut on the London Stock Exchange in June, said it is currently building on five sites, which will deliver more than 1,150 new homes.
House sales
It said sales continue to progress well at its Parkside and Albany sites with 112 houses now sale agreed, of which 64 have been completed.
“Stronger-than-expected sales levels in Parkside over the summer months will also positively impact on second-half completion targets,” it said.
The group’s total land bank portfolio consists of 27 sites, on which the company intends to develop more than 11,500 units, with 90 per cent of those units located in Dublin and the surrounding commuter belt.
Cairn said it had available liquidity of €167.1 million, comprised of cash of €117.1 million and undrawn facilities of €50 million.
“Having executed our successful site-acquisition phase, Cairn continues to accelerate its home-building operations. We have assembled a talented and experienced team to drive forward with our plans,” said chief executive Michael Stanley.
Mr Stanley said it was too early to fully assess the impact of Brexit, Cairn believes it may result in increased foreign direct investment to Ireland, which would further add to the demand for housing.
“Given the Dublin focus of our land bank, this will potentially have a positive impact on Cairn’s business in the future,” he said.
Longer-term targets
Investec chief economist Philip O’Sullivan said in a note that investors “would likely take comfort from the progress the group is making towards achieving its longer-term targets.”
Elsewhere, Colin Sheridan of Davy said Cairn had issued a strong statement that showed summer sales were progressing ahead of expectations.
“The results are likely to be well received by the market,” he said as Davy reiterated its “outperform” rating on the group.
