A profit warning from Inland Homes (INL:AIM) pushes the housebuilder down, but not out, as the shortfall is due to an issue with a third party contractor.
Shares nudge 0.2% lower to 66.2p.
Inland’s pre-tax profit for the June 2016 financial year is expected to be marginally lower than the market forecast of £15.9 million.
The housebuilder specialises in the acquisition and regeneration of brownfield sites in south east England and outer London boroughs.
One of its contractors on four of its development sites entered administration.
This setback has resulted in the firm taking control of relevant sites and construction, causing 23 legal completions to be delayed, which will be deferred into this financial year.
Writing in the aftermath of Brexit, broker FinnCap reiterated a ‘buy’ recommendation and 80p price target. It believes the market reaction has been ‘unduly severe’ as shares are below historic book value.
Demand for residential plots is strong with 425 plots sold in the year. Inland Homes has continued to significantly grow its land bank, which stood at a record 6,552 plots by the end of the financial year.
The company says it has a forward order book of £23.4 million with 315 homes currently under construction across eight sites.