Investing.com — (LON:BWY) shares fell over 8% on Tuesday after Britain’s largest housebuilders posted a decline in operating margin and a 12.2% surge in administrative costs in the first half of fiscal 2026, even as revenue and completions rose.
Underlying operating margin fell to 10.5% in the six months ended Jan. 31, 2026 from 11% a year earlier, as administrative expenses climbed to £86.3 million from £76.9 million. Full-year administrative costs are now forecast at £170-£175 million.
Revenue rose 6.3% to £1.52 billion, while underlying operating profit edged up 1.5% to £159 million. Total completions grew 2.7% to 4,702 homes, with the average selling price rising to £322,180 from £310,581.
Cashflow weakened materially. Adjusted operating cashflow fell to £314.1 million from £366.1 million a year earlier. Net debt stood at £72 million against net cash of £8 million at July 31, 2025, after dividends and share buybacks totalling £105.3 million. Adjusted gearing rose to 10.3% from 8.5%.
The company raised its full-year volume guidance above prior guidance of 8,749 homes while holding margin guidance at approximately 10.5%, against 10.9% for the full year ended July 31, 2025. The full-year average selling price is now expected at around £325,000.
Chief Executive Jason Honeyman said the ongoing conflict in the Middle East had “led to the return of volatility” in mortgage markets and “heightened the risk of both lower customer demand and inflationary cost pressures.”
The interim dividend rose to 23 pence per share from 21 pence. Statutory earnings per share was broadly flat at 84.5 pence versus 84.6 pence a year earlier.
The forward order book at March 13 stood at 5,311 homes valued at £1.55 billion, down from 5,582 homes at £1.58 billion a year earlier. The private reservation rate in the six weeks to March 13 was 0.70 per outlet per week, against 0.76 a year earlier.
Bellway set aside a further £10.7 million for legacy building safety remediation, bringing its remaining provision to £473.1 million.