Henry Boot LON: BOOT reported a weaker first-half performance amid subdued transaction activity across its markets, with revenue falling 19% to just under £81 million and the group posting an operating loss of £3.9 million.
Chief Financial Officer Darren Littlewood said the result was below expectations, reflecting weaker trading and a reduction in the value of the company’s wholly owned investment property portfolio. Net debt rose to £133 million and gearing increased to 33%, although the company expects gearing to decline toward year-end as planned disposals complete.
The board decided not to pay an interim dividend, citing higher gearing and the weighting of expected performance toward the second half. Littlewood said the company would revisit its dividend decision after full-year results, with any restoration dependent on sales generation, cash recovery and debt reduction.
New CEO Sets Near-Term Priorities
Edward Hutchinson, who recently became chief executive after more than 20 years with the group, said the board’s remit was for him to “make a difference” as Henry Boot navigates difficult market conditions. He said a business review is under way, with a refreshed strategy and medium-term objectives due in early 2027.
Hutchinson outlined three priorities for the next six to 12 months:
- Unlocking and crystallizing value through planning consents, land sales, leasing activity and housing completions.
- Reducing borrowings through stricter cost and capital discipline, selective investment and partnership funding.
- Improving operational efficiency by simplifying processes, accelerating decision-making and sharing resources across the group.
He said the company would not rely on an eventual market recovery to improve performance, particularly at housebuilder Stonebridge Homes.
Sales Progress and Balance Sheet
Henry Boot said it had completed, exchanged or reserved 71% of its budgeted full-year property sales. Completed sales totaled £61 million, rising to £114 million including exchanged disposals and post-period-end completions. Including reserved sales, the figure reached £144 million.
The company requires a further £59 million of sales to meet its £203 million target. Most of that is expected to come from Hallam Land and HBD, with Hallam holding more than 1,700 plots under offer and HBD pursuing several transactions.
Littlewood noted that the position was behind the prior year, when the company had secured £176 million of sales, or 80% of its forecast, at the same stage.
The group’s underlying asset value per share, excluding the pension surplus, declined 4% to just under £3. The reduction reflected the acquisition of an additional interest in Stonebridge, payment of the 2025 dividend and first-half retained losses.
After the period ended, Henry Boot agreed to increase its bank facility to £165 million until Dec. 31. Littlewood said lenders remained supportive, while discussions continued regarding potential amendments to full-year covenant requirements.
Stonebridge Faces Expected Full-Year Loss
Hutchinson said Stonebridge Homes is expected to report an operating loss in 2026, citing slower sales rates, build-cost inflation of around 4%, site costs and legacy extension costs. The business completed 72 homes in the first half, with completions expected to be weighted toward the second half.
Private average selling price was £431,000, while incentives were stable, but Hutchinson said volume was the principal pressure point. Stonebridge’s net private reservation rate was 0.38, reflecting higher mortgage rates during the second quarter, and its forward order book stood at £30 million.
The company has appointed Warren Thompson as Stonebridge managing director, with his arrival expected later in the year. Henry Boot is also targeting stronger sales capabilities, customer experience, data quality, procurement oversight and cost control.
Hutchinson said Stonebridge would pursue a more disciplined land strategy aligned with its premium-home offering. The company may focus more on sites of roughly 50 to 80 homes rather than routinely competing on larger developments of more than 200 units. He also said future developments may offer a broader mix of two- to five-bedroom homes, which could lower average selling prices while expanding the potential customer base.
Hallam Land and HBD Pipeline
Hallam Land sold 556 plots during the period, with activity affected by major housebuilders changing their land strategies. The two transactions were the sale of 416 plots at Biggleswade to Persimmon and 140 plots at Thorpe Willoughby to Vistry. Average gross profit per plot was nearly £11,000, in line with Hallam’s five-year average.
The land promotion business has more than 2,000 plots exchanged or under offer and expects these sales to complete in the second half. It invested £11 million in its pipeline, submitted nearly 3,400 plots into planning during the year to date and remains on track to submit 10,000 plots for the full year.
Hallam’s strategic land portfolio comprises nearly 108,000 plots, including almost 9,100 with planning consent and a further 21,000 awaiting determination. Littlewood said the company expects the supportive planning environment to increase its stock of consented plots.
HBD’s committed development program increased to £161 million, of which Henry Boot’s share is £113 million. Nearly 80% of the program is pre-let or under offer. The addition of Golden Valley Phase 1 in Cheltenham contributed £95 million of gross development value and is fully funded.
Golden Valley’s first phase includes IDEA and ROUTER, with IDEA 68% pre-let or under offer. Hutchinson said the mixed-use scheme is centered on cybersecurity innovation. HBD also highlighted development opportunities at Wakefield Hub, Freeport 36 and AvTech Duxford.
Looking ahead, Hutchinson said the company expects a better second half as land sales delayed from the first half complete. However, he said transaction volumes are likely to remain subdued for the rest of the year. “We will not prioritize short-term performance at the expense of future returns,” he said.
About Henry Boot (LON:BOOT)
Henry Boot is one of the UK's leading land, property development and home building businesses - and we've been transforming land and spaces since 1886. Listed on the London Stock Exchange for nearly 100 years, we're renowned for quality, expertise, delivery and a partnership approach across the group - which comprises Hallam Land, HBD, Stonebridge Homes and Banner Plant.
Operating across the UK, and employing over 400 people, we focus on three key markets: residential, industrial and logistics, and urban development.
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