September 6, 2019 / 6:28 AM / 3 months ago

Housebuilder Berkeley says market is robust in London despite Brexit

(Reuters) - Housebuilder Berkeley Group Plc (BKGH.L) said on Friday the state of the market in London and the South East of England was particularly strong, and pricing stable, in the first four months of its financial year against the backdrop of Brexit jitters.

But the company projected pretax profit in each of the next six years to be lower than last year and said it was looking at ways to limit a hit from a potentially disruptive Brexit.

The company set a pretax profit target of 3.3 billion pounds over the six years to April 2025, with profit in any one year expected to be between 500 million and 700 million pounds. It posted pretax profit of 775.2 million pounds in its latest financial year ended April 30.

“Providing PBT (profit before tax) targets forward six years is bold (and we believe conservative - it hasn’t missed a target yet),” Jefferies analysts said.

Berkeley said it was working with its supply chain to speed up the delivery of some materials and components to cushion any potential blow in case of a chaotic Brexit.

After lawmakers managed to pass a bill in parliament this week to stop Prime Minister Boris Johnson taking Britain out of the European Union on Oct. 31 without transitional arrangements in place, the possibility of a snap election has risen.

Options on the table still range from a turbulent “no-deal” exit to abandoning the endeavour altogether.

The company said forward sales remained above 1.8 billion pounds and forecast its cash pile at the end of the first-half to be similar to the 975 million pounds level as of the end of its last financial year.

Reporting by Shashwat Awasthi and Samantha Machado in Bengaluru; Editing by Bernard Orr

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