March 21, 2017 / 7:15 AM / 3 years ago

Builder Bellway to raise dividend as half-year profits rise

A Bellway sign is seen at a housing construction site in London, Britain, February 5, 2017. REUTERS/Toby Melville

LONDON (Reuters) - British housebuilder Bellway (BWY.L) said on Tuesday it would raise its dividend after posting a nearly 10 percent rise in half-year pre-tax profits, although it warned that labour shortages were pushing up costs in the sector.

Bellway, which builds around half of its homes in London and the south of England, posted profits of 248 million pounds ($307 million) in the six months to the end of January and said it would raise its interim dividend in line with earnings by over 10 percent to 37.5p per share.

The firm said that the cost of employing workers was rising in the sector but that it was well-placed to deal with the trend, which some builders fear could be exacerbated by any immigration curbs imposed as part of Brexit.

“Labour shortages continue to place upward pressure on build costs throughout the construction sector, however, a strong operational focus and an embedded culture of cost control has helped Bellway minimise any dilutive effect on the gross margin,” the firm said.

Reporting by Costas Pitas; editing by Kate Holton

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