More on Wilson Bowden
Wilson Bowden: Trading statement
Wilson Bowden issued a gloomy trading statement reporting that conditions in the housing market have remained subdued and reservation levels have not recovered. Visitor numbers have not returned to early spring levels.
The company has been increasing the number of selling sites in an effort to compensate for the lower numbers of sales per site. The company is currently operating from 143 selling sites, 16% more than last year but sales per site have fallen by 22%. House completions are expected to be around 10% below the number achieved in the first half of last year.
The company has been offering a higher level of sales incentives but average selling prices have remained generally flat. The sales mix has also changed with a greater number of flats being sold, presumably because of price and yet another sign, if more were needed, of the slowdown in the housing market.
The change in sales mix expected to adversely affect both average selling price and margins.
Wilson Bowden says the final outcome for 2005 will be dependent on the return of buyer confidence in the autumn, something we view as being unlikely.
The share trades at 1,120p, on a prospective PE (2005 earnings) of 5.9x which is at the lower end of the sector range, with a yield of 3.7%.
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