Westbury (housebuilder)

Last updated

Westbury
Industry Housebuilding
Founded1965
Defunct2005
FateAcquired
Successor Persimmon plc
Headquarters Cheltenham, Gloucestershire, England

Westbury plc was a British housebuilding company based in Cheltenham, Gloucestershire. It was listed on the London Stock Exchange and was a constituent of the FTSE 250 Index but was acquired by Persimmon plc in 2005.

History

Westbury was established by the Joiner family in Gloucestershire in 1964. [1] Westbury remained a relatively small operation until 1971, at which point Geoff Hester was recruited to run the business; from that point onwards, Westbury was managed by professional housebuilders from outside the Joiner family. In the aftermath of the 1974 housing recession, the company underwent a period of regional expansion and, by the early 1980s, there were three regions, Gloucester, Bristol and south Wales, building around 1,500 units per year between them. By this point, the Joiner family were keen to realise their equity in the company and it was floated on the London Stock Exchange in 1986. The flotation was almost immediately followed by the acquisition of the Midlands division of Whelmar and the opening of a southern region. [2]

The company was negatively impacted by a recession in the early 1990s. [3] [4] Specifically, Westbury enacted provisions for a sharp decrease in the valuation of Westbury's land bank, which contributed to a pre-tax loss of £15.12 million being incurred in FY 1991. [5] [6] Nevertheless, the firm opted to maintain its volumes throughout this period. [2] During November 1992, Westbury announced a pre-tax profit of £2.6 million, indicating its improving condition; [7] by mid-1994, the firm's house sales had risen to 2,685 units annually, turnover had increased by 15 per cent to £152 million, and it had recorded a pre-tax profit of £8.3 million. [8] [9]

Accordingly, across the mid-to-late 1990s, Westbury resumed its expansion programme, resulting in a series of substantial acquisitions being completed. [2] [10] These included the purchase of Clarke Homes from BICC in 1995; [11] [12] the Manchester-based firm Maunders in 1998; [13] [14] and the southern-centric Prowting in 2002. [15] [16] Several other initiatives were also launched by the company around this period. Specifically, Westbury opted to move into prefabricated housing via the construction of a factory that was capable of producing 5,000 units per year; it also diversified into financial services. However, both of these ventures ran at a loss. [2] [17]

Largely as a result of its acquisitions, Westbury's profits sharply increased during the late 1990s, such as the 49 per cent rise in pre-tax profits recorded in late 1996. [12] Other positive factors included a focus on increased operational efficiency, [18] a shift upmarket, [19] and rising land and house prices at a rate of roughly 10 per cent during this period. [20] [21] In June 1999, the firm announced that pre-tax profits had risen by 44 per cent to £44.1 million. [22]

During November 2005, Westbury received a £643 million takeover approach from Persimmon plc, a larger British housebuilding company, which was accepted by the shareholders and management alike. [23] [24] [25]

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References

  1. ↑ Company Prospectus April 1986.
  2. 1 2 3 4 Wellings, Fred (2006). Dictionary of British Housebuilders. Troubador. ISBN   978-0-9552965-0-5.
  3. ↑ "25May90 UK: WESTBURY EXPECTED TO ANNOUNCE 20% DROP IN PRE-TAX PROFITS". constructionnews.co.uk. 25 May 1990.
  4. ↑ "09Nov90 UK: WESTBURY'S HALF YEAR RESULTS TO AUGUST 1990 SHOW PRETAX PROFITS DOWN 72% TO £5.1 MILLION". constructionnews.co.uk. 8 November 1990.
  5. ↑ "15Mar91 UK: WESTBURY SHARES FALL 7P AFTER ANNOUNCEMENT OF PROVISION AGAINST FALL IN ITS LAND BANK VALUE". constructionnews.co.uk. 14 March 1991.
  6. ↑ "28May92 UK: LAND BANK SETBACKS LEAVE WESTBURY WITH A £15.12M PRETAX LOSS FOR THE YEAR ENDING FEBRUARY 1991". constructionnews.co.uk. 28 May 1992.
  7. ↑ "12Nov92 UK: WESTBURY RECOVERS". constructionnews.co.uk. 12 November 1992.
  8. ↑ "26May94 UK: WESTBURY STARTS TO ROLL – ANNUAL RESULTS". constructionnews.co.uk. 26 May 1994.
  9. ↑ "03Nov94 UK: PROFITS AT WESTBURY REFLECT PRESSURE LIFT". constructionnews.co.uk. 3 November 1994.
  10. ↑ Fishlock, Bill (1 February 1996). "Merger mania on way says Persimmon boss". constructionnews.co.uk.
  11. ↑ Grimond, Magnus (13 May 1997). "Profits rise 71% at Westbury Homes". The Independent.
  12. 1 2 "Clarke acquisition boosts Westbury". constructionnews.co.uk. 14 November 1996.
  13. ↑ "Housebuilding shares boom in wake of takeover". The Independent. 13 March 1998.
  14. ↑ "Westbury wants to make £2.5m saving". constructionnews.co.uk. 14 May 1998.
  15. ↑ Lumsden, Gavin (17 May 2002). "Prowting goes to Westbury". citywire.com.
  16. ↑ "Westbury in agreed bid for Prowting". standard.co.uk. Retrieved 10 November 2024.
  17. ↑ "Westbury to build homes in less than a day". constructionnews.co.uk. 28 October 1999.
  18. ↑ Morby, Aaron (6 November 1997). "Westbury and Prowting benefit after efficiencies prompted by rising land prices Builders earn reward from tight cost control". constructionnews.co.uk.
  19. ↑ "Move upmarket sees builders home in on improved results". constructionnews.co.uk. 13 May 1999.
  20. ↑ "House price profits up". constructionnews.co.uk. 16 January 1997.
  21. ↑ "Westbury rises 35pc as land prices level off". constructionnews.co.uk. 12 November 1998.
  22. ↑ "In Brief Westbury up 44pc". constructionnews.co.uk. 24 June 1999.
  23. ↑ "UK housebuilders announce tie-up". BBC News. 24 November 2005.
  24. ↑ Griffiths, Ian (25 November 2005). "£640m secures win-win housebuilding deal". The Guardian.
  25. ↑ Griggs, Tom (24 November 2005). "Persimmon agrees Westbury price". Financial Times.
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