Tuesday 11 October 2016
This announcement contains inside information
Announcement - change of director and trading update
McCarthy & Stone ("the Group"), the UK's leading retirement housebuilder, announces that Nick Maddock, who has served as the Group's Chief Financial Officer (CFO) since September 2011, has decided to leave the business to take up the position of CFO at SIG plc.
Nick will remain in post and a leaving date in Q1 2017 will be agreed in due course. A process to identify his successor and ensure a smooth transition is now underway, and a further update will be made when the Group announces its full year results statement on 15 November 2016.
Commenting on behalf of the Board, John White, Chairman of McCarthy & Stone, said:
"Nick has played an important role over the past five years in re-capitalising the Company, delivering our growth strategy and preparing us for our successful return to the Main Market of the London Stock Exchange in November 2015. With the IPO now complete and the first year's results delivered, Nick has decided to move on. He leaves the business in a very healthy financial position, having just recorded a 31% increase in revenue year-on-year and with c.£52 million of net cash on our balance sheet at the year end. We remain firmly on track to meet our medium term target of building and selling at least 3,000 units a year and achieving 25% ROCE."
Following the Group's trading update on 2 September 2016 for the full year ended 31 August 2016, the Board would like to provide an additional update on the Group's first five weeks of trading in its new financial year.
The last trading update on 2 September noted that sales immediately post the EU referendum had slowed and cancellations rates had increased, and that consequently the Group came into the new financial year with a forward sales order book of £114 million, which was down on last year's £131 million.
The Group is pleased to confirm that since that update, trading and other lead indicators are now ahead of the previous year. Over the first five weeks of the new financial year, reservations have been stronger and cancellation rates have returned to more normal levels. New enquiries have increased and first time visitors to our developments have been noticeably ahead of the prior year. Consequently, the Group's forward order book, including legal completions since 1 September, is now moving towards a similar level to last year at c.£173 million (2015: £177 million).
This performance provides some early evidence of improving customer sentiment and a potential return to normal trading conditions. More detail on current trading and outlook will be provided in the full year results statement on 15 November 2016.
This trading update contains certain forward-looking statements about the future outlook for the Group. Although the Directors believe that these statements are based upon reasonable assumptions, any such statements should be treated with caution as future outlook may be influenced by factors that could cause actual outcomes and results to be materially different.
For more information, please contact:
McCarthy & Stone, 01202 292480
Clive Fenton, Chief Executive Officer
Nick Maddock, Chief Financial Officer
Paul Teverson, Director of Communications
Powerscourt, 020 7250 1446 / [email protected]
Justin Griffiths, Nick Dibden
Notes to editors:
McCarthy & Stone is the UK's leading retirement housebuilder, with a c.70% share of the owner-occupied market1. The Group buys land and then builds, sells and manages high-quality retirement developments. It has built and sold more than 51,000 apartments across more than 1,100 developments since 1977, and is renowned for its focus on the needs of those in later life. It re-joined the Main Market of the London Stock Exchange in November 2015 and re-entered the FTSE 250 following its quarterly review on 21 March 2016.
There is a growing demand for specialist retirement housing, with the number of people aged 85 and over in the UK expected to more than double between 2015 and 2035 from 1.5 million to 3.2 million, and the number of people aged 65 and over expected to increase by more than 50% from 11.6 million to 17.2 million2. According to research by Demos, 1 in 4 over 60s are interested in retirement living3, yet only c.141, 000 units of specialist retirement housing for homeowners have been built4.
Older people are also the one group where rates of homeownership have risen in recent years. Homeownership among those aged 65 to 74 increased from 50% in 1981 to 78% in 2012 and among the over 75s it rose from 47% to 73%. However, for those aged 25 to 34, it has fallen from 62% in 1981 to 43% in 2012 and for 35 to 44 year olds it fell from 69% to 63%5. The Department for Communities and Local Government (DCLG) is forecasting that older householders (aged 65+) will grow by 155,000 per year to 2039 and will account for about three quarters (74%) of total household growth over that period6.
The Group has two established product ranges - Retirement Living and Assisted Living - which provide one and two bedroom apartments across the country with varying levels of support and care for older homeowners. In late 2014, McCarthy & Stone launched its Ortus Homes product, which is exclusively for the over 55s and those in the earlier stages of retirement who are seeking to downsize for their leisure years. McCarthy & Stone is currently selling its first apartments in this new product range across a number of locations, helping the Group to capture a wider share of the active retiree market. The first Ortus Homes development at Scarlet Oak in Solihull won the Best Retirement Scheme at the annual Housebuilder Awards in November 2015.
McCarthy & Stone's commitment to quality and customer service continues to be recognised by homeowners. In March 2016, the Group received the full Five Star rating for customer satisfaction from the HBF for the eleventh consecutive year - making it the only UK housebuilder, of any size or type, to achieve this accolade.
1 Based on 3,453 registrations of cross tenure properties specifically designed for the elderly with the NHBC during calendar year 2015, of which 2,672 were registered by McCarthy and Stone.
2 Population projections by the Office for National Statistics (2014 based).
3 Demos- Top of the Ladder (2013)
4 Independent data provided by the Elderly Accommodation Counsel, April 2016
5 Office for National Statistics - Housing and home ownership in the UK (2015)
6The Department for Communities and Local Government (DCLG) projections, July 2016
This information is provided by RNS