Bancon Group accounts for the year ended March 2024 show operating profit of £3.8m, compared to £4.6m in the previous year, on turnover down by 26% to £97.7m (2023: £132m). Pre-tax profit was down 28% at £1.3m (2023: £1.8m).
However, the company says that it expects a significant increase in turnover and profit in its current year to March 2025 as market conditions start to improve. Current sales of homes are more than 50% ahead of the last financial year and a strong order book for timber frame in 2025 has already been secured.
Chief financial officer Andrew Tweedie said: “In what was a challenging year for our industry, we have weathered the storm to deliver a resilient performance with positive results. Our strong and balanced portfolio of business streams combined with a focus on control of margins and overheads have enabled us to remain profitable in spite of reduced sales across our business.
“With some of the uncertainty in the market having settled, we are now seeing a marked uplift in activity and trading performance across all the sectors in which we operate. We look forward to delivering a strong and further improved result come our year-end in March 2025.”
Turnover at the Bancon Homes division was down from £68.4m in 2023 to £65.6m for the year to March 2024. The reduction in sales of private new build homes was largely offset by an increased activity in the provision of affordable homes, including at its Cloverhill development, where Bancon has handed over 258 of the 536 affordable homes, planned over a four-year period, to Aberdeen City Council.
Bancon Construction increased its operating profit by 38% despite a 41% reduction in turnover from £35.5m to £21m. Directors attribute this to a strategy of derisking the business and moving away from volatile main contracting to focus on better margin works and longer-term contracts with a better risk profile. This has resulted in partnerships with local authorities and housing associations with a focus on building affordable housing and retrofitting existing council properties.
Bancon’s Deeside Timberframe subsidiary – which, as its name suggests, specialises in the manufacture and assembly of timber frame buildings – saw turnover fall 33% to £25.0m (2023: £37.1m), in like with the general decline in UK housing output. It remained profitable, however, making £1.5m, compared to £2.3m in the previous year, and volumes have recovered since the end of the financial year.
Bancon Group chairman Bob McAlpine concluded: “These robust results reflect the underlying strength of our business, the spread of risk and strong position in the markets in which we operate. With market conditions improving, a strong team in place, and a marked uplift in activity levels this year we are well-placed to deliver our growth ambitions and capitalise on the prospects available to us going forward.
