London-focused residential property developer Telford Homes PLC said it expects to book more than £50 million of pretax profit for the year ending March 31, 2019, assuming the market does not worsen further as the Brexit date approaches.
In order to meet that target, the company has fewer than 90 homes left to sell alongside some affordable and build-to-rent contracts that it expects to exchange during the next six months.
Telford also expects to report fewer open market completions in the first half of the year to March 31, 2019, than in the following six months, resulting in lower first-half 2019 pretax profit as compared to the second half. The company, however, expects first-half 2019 pretax profit to surpass the £8.7 million figure recorded in the year-ago period. The full-year profit growth is also expected to lead to a higher proposed interim dividend.
In outlining its earnings projections, Telford said the "increasing amount of negative commentary" around the possible consequence of Brexit and the impact it may have on the U.K. economy and housing sector has added to a more general downturn in the market for expensive prime homes in London.
The company also noted that Greystar has obtained planning approval for 894 build-to-rent homes at Parkside in Nine Elms, adding that the company is advancing toward entering into a full-build contract in order to break ground on the project "as soon as possible."
Telford will also join hands with "a major land owner" to obtain planning consent for approximately 700 homes on a site in East London. The company is also poised to exchange contracts to acquire a site in West London that has a planning consent to deliver approximately 280 homes for open market individual sale and subsidized affordable homes.
Telford will release its interim results for the six months ended Sept. 30 on Nov. 28.