Countryside property group bounces back into the black: Big increase in housing association work forecast

COUNTRYSIDE Properties bounced back into profit in the year to September after heavy write-downs had sent the home counties housebuilder and property investor into the red in the previous 12 months.

Pre-tax profits of pounds 4.7m compared with a loss of pounds 11.7m, struck from sales of pounds 91.8m ( pounds 79.7m). Excluding the land and property value write-down of pounds 14.7m, trading profits increased 57 per cent from pounds 3m.

Alan Cherry, chairman, said: 'I am more confident about the group's prospects than at any other time during the past few years. Turnover is poised to increase significantly this year and further growth in profits should be achieved.'

Underlying profits from housing, which took most of the 1992 hit, rose from pounds 5.4m to pounds 6m. Completions rose sharply from 751 homes to 1,295, reflecting the fast-expanding social housing business.

Mr Cherry said he expected work for housing associations to rise 25 per cent this year. Cuts in government spending on social housing announced in the Budget would be offset by increased private sector funding.

There were 393 speculative completions built out of a land bank of 5,000 plots. Looking forward, reservations are running 69 per cent ahead of last year and inquiries are up 18 per cent.

The commercial property arm reversed an pounds 861,000 loss into a pounds 55,000 profit. During the year it completed a 20,000sq ft scheme in Barking and signed a deal with PosTel, the BT and Post Office pension fund, to develop a 20-acre site near Chelmsford.

Property investment reduced last year's pounds 6.2m loss to a pounds 1.3m deficit. Mr Cherry said that although the pounds 57m portfolio had attracted interest from potential buyers it would probably be held for the time being.

Despite borrowings of pounds 76.9m, compared with net assets of pounds 76.1m, the group was under no pressure to raise more cash, Mr Cherry said.

Six months ago Countryside called on shareholders for pounds 17m via a three-for- eleven rights issue.

Earnings per share emerged at 5.9p against a loss of 16.6p per share in 1992. The maintained final dividend of 2.7p contributed to a full-year payout of 4.11p.

The shares, which have doubled in value over the past year, closed 8p lower yesterday at 141p.