{"id":2472729,"date":"2023-09-08T10:39:02","date_gmt":"2023-09-08T14:39:02","guid":{"rendered":"https:\/\/www.valuewalk.com\/?p=2472729"},"modified":"2023-09-08T10:39:06","modified_gmt":"2023-09-08T14:39:06","slug":"berkeley-group-on-solid-foundations-to-deliver-profit-guidance","status":"publish","type":"post","link":"https:\/\/www.valuewalk.com\/berkeley-group-on-solid-foundations-to-deliver-profit-guidance\/","title":{"rendered":"Berkeley Group &#8211; On Solid Foundations To Deliver Profit Guidance"},"content":{"rendered":"\n<ul>\n<li>Private sales reservations down 35%<\/li>\n\n\n\n<li>Net cash of \u00a3325m expected at the end of October<\/li>\n\n\n\n<li>Pre-tax profit guidance reiterated<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\">Berkeley Group&#8217;s Earnings<\/h2>\n\n\n\n<p>Berkeley Group Holdings PLC (LON:BKG) issued a trading update covering the four months to the end of August, and we\u2019ve seen a similar story across the rest of the housebuilders this earnings season. It looks like the recent interest rate hikes pushing up <a href=\"https:\/\/www.valuewalk.com\/is-3-25-a-good-mortgage-rate\/\">mortgage<\/a> costs are causing a relative lack of urgency among new buyers as private sales reservations dropped 35%.<\/p>\n\n\n\n<div class=\"ca-widget\" data-token=\"k8f5c9ac62a4\"><\/div><script async defer src=\"https:\/\/secure.money.com\/embeds\/embedder.js?v=1\"><\/script>\n\n\n\n<p>Pricing\u2019s remained resilient though, due to the constrained supply of new-build and second-hand homes, giving Berkeley the confidence to reiterate its guidance for \u00a31.05bn of pre-tax profits across the coming two financial years, weighted slightly towards the current year. That represents declines of around 10% in consecutive years.<\/p>\n\n\n\n<p>In the meantime, Berkeley\u2019s taking action to protect its financial resilience by carefully matching its supply with demand and completely stopping spending on new plots of land. That\u2019s expected to keep net cash at \u00a3325m by the end of October, down around 20% since April but should be enough to help cushion the impact of lower sales in the near term.<\/p>\n\n\n\n<p>Looking bigger picture, Berkeley\u2019s London focus offers something different to peers, and demand in the capital\u2019s likely to remain more robust than other areas of the country. Add to the mix that the <a href=\"https:\/\/www.valuewalk.com\/march-winds-of-hope-about-china-blow-through-markets-while-uk-housing-market-in-focus\/\">UK housing market<\/a>\u2019s suffering from a fundamental supply shortage, and the long-term picture doesn\u2019t look so bleak. But in the short term, there\u2019s plenty of stormy clouds for Berkeley to weather.<\/p>\n\n\n\n<p><em>For access to stock reports and articles please visit the <\/em><a href=\"https:\/\/www.hl.co.uk\/shares\/share-research\" rel=\"nofollow\" target=\"_blank\"><strong><em>Hargreaves Lansdown share research homepage<\/em><\/strong><\/a><em> or sign up to our updates <\/em><strong><em><a href=\"https:\/\/www.hl.co.uk\/shares\/share-research\/register-for-research-updates\" rel=\"nofollow\" target=\"_blank\">here<\/a>.<\/em><\/strong><\/p>\n\n\n\n<p><em><strong>Article by Aarin Chiekrie, equity analyst at Hargreaves Lansdown<\/strong><\/em><\/p>\n ","protected":false},"excerpt":{"rendered":"<p>Berkeley Group&#8217;s Earnings Berkeley Group Holdings PLC (LON:BKG) issued a trading update covering the four months to the end of &#8230; <a title=\"Berkeley Group &#8211; On Solid Foundations To Deliver Profit Guidance\" class=\"read-more\" href=\"https:\/\/www.valuewalk.com\/berkeley-group-on-solid-foundations-to-deliver-profit-guidance\/\" aria-label=\"More on Berkeley Group &#8211; On Solid Foundations To Deliver Profit Guidance\">Read more<\/a><\/p>\n","protected":false},"author":22076,"featured_media":2464088,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_mi_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[6640],"tags":[660503,657293,661527],"states":[],"acf":[],"modified_by":"Umair Tariq","_links":{"self":[{"href":"https:\/\/www.valuewalk.com\/wp-json\/wp\/v2\/posts\/2472729"}],"collection":[{"href":"https:\/\/www.valuewalk.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.valuewalk.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.valuewalk.com\/wp-json\/wp\/v2\/users\/22076"}],"replies":[{"embeddable":true,"href":"https:\/\/www.valuewalk.com\/wp-json\/wp\/v2\/comments?post=2472729"}],"version-history":[{"count":4,"href":"https:\/\/www.valuewalk.com\/wp-json\/wp\/v2\/posts\/2472729\/revisions"}],"predecessor-version":[{"id":2472736,"href":"https:\/\/www.valuewalk.com\/wp-json\/wp\/v2\/posts\/2472729\/revisions\/2472736"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.valuewalk.com\/wp-json\/wp\/v2\/media\/2464088"}],"wp:attachment":[{"href":"https:\/\/www.valuewalk.com\/wp-json\/wp\/v2\/media?parent=2472729"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.valuewalk.com\/wp-json\/wp\/v2\/categories?post=2472729"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.valuewalk.com\/wp-json\/wp\/v2\/tags?post=2472729"},{"taxonomy":"states","embeddable":true,"href":"https:\/\/www.valuewalk.com\/wp-json\/wp\/v2\/states?post=2472729"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}