CHIEF EXECUTIVE'S REVIEW

 

Purpose, Long-Term Strategy and Capital Allocation

 

Berkeley's purpose is to build quality homes, strengthen communities and improve lives, using its sustained commercial success to make valuable and enduring contributions to society, the economy and natural world.

 

Berkeley is the only large UK homebuilder to align with Government on prioritising brownfield land, as we progress 32 of the country's most challenging regeneration projects, 26 of which are in delivery. Each of these neighbourhoods is uniquely designed in partnership with local councils and communities and includes valuable public amenities alongside tenure-blind private and affordable homes. 

 

It has been hugely exciting to see more of these complex sites transform into popular, inclusive and low carbon communities, including White City Living, a former warehouse complex, where we have now delivered 840 private and affordable homes, a hugely popular community park, pedestrian routes to Westfield Shopping Centre and an Amazon Fresh convenience store. 

 

At Grand Union we recently joined local residents and councillors to launch a beautiful canal-side public plaza, featuring a restored narrowboat, life-size sculptures inspired by pupils from nearby Alperton Community School and a 5,000 sq ft Community Hub.  This regeneration partnership with the London Borough of Brent is transforming the previously derelict Northfield Industrial Estate.

 

Alongside this, Berkeley's financial strategy reflects the cyclical nature and complexity of brownfield development, protecting and enhancing long-term value for shareholders and using its development expertise to maximise the returns from its assets, creating the right development solution for each site.  Our capital allocation policy is therefore clear and remains unchanged:  first, ensure financial strength is appropriate to the prevailing operating environment; second, invest in the business (land and work-in-progress) at the right time; and third, make returns to shareholders through dividends and share buy-backs.

 

This disciplined approach allows Berkeley to deliver sustainable, risk-adjusted returns over the cycle, targeting a sustained pre-tax return on equity of 15%.

 

Current position

 

From the strong trading period that followed the Global Financial Crisis, Berkeley invested in accumulating its unrivalled portfolio of complex large-scale brownfield regeneration sites in and around London, which will sustain the Group's delivery profile for the next ten years.   As investment in the upfront development costs on a number of these sites completes over this and the next financial year, Berkeley's focus will increasingly be on cash generation. This will provide the optionality to invest further in the business or reassess the level of returns to shareholders, depending upon the characteristics of the prevailing operating environment. Berkeley is targeting being working capital neutral over this period and will only invest in new sites very selectively or in partnership with landowners; such as retailers, utilities, local authorities and housing associations.

 

In the near-term, Berkeley will focus on matching production on existing sites to demand and delivering its forward sales over the period to 30 April 2025. Beyond this, the current operating environment, characterised by record levels of planning tariff within an increasingly complex and slow planning system, at a time of high build costs, increased regulation and higher corporation tax, alongside the RPDT and proposed new Building Safety Levy, will inevitably continue to see a reduction in supply of new homes in London and the South East. Berkeley's delivery of new homes will therefore result in a reduction in its land holdings.

 

While sales prices have been at levels to largely offset increasing costs in recent years, margins may be placed under pressure if these headwinds do not abate sufficiently and as households and businesses come to terms with heightened inflation, increased interest rates and the more protracted recession articulated by the Bank of England in its most recent forecasts.

 

Shareholder Returns

 

Berkeley has in place a long-term plan for shareholder returns, based upon an ongoing annual return of £283 million planned through to September 2025, which can be made through either dividends or share buy-backs.

 

In September, Berkeley paid a dividend of £23 million (21.25 pence per share) which completed the return of £141 million that was due in respect of the six months ended 30 September 2022, with £118 million having been returned via share buy-backs, of which £64 million was returned in the previous financial year and £54 million during this half.

 

Berkeley has committed to the next ongoing scheduled shareholder return, which is the £141 million in respect of the six months ending 31 March 2023, against which £56 million has been returned via share buy-backs in the first half of the year.

 

Therefore, the total amount returned via share buy-backs in this period is £110 million across 2.9 million shares, at an average price of £37.61 per share. 

 

The ongoing annual return of £283 million currently equates to £2.60 per share; a 30% increase on the initial £2.00 per share initiated in 2016 following share buy-backs undertaken since that date and the share consolidation in the previous financial year.

 

 

Summary of Performance

 

Berkeley has delivered pre-tax profit of £284.8 million for the six-month period:  

 

Six months ended 31 October	2022		2021		Change
	£'m		£'m		£'m		%
Revenue	1,200.7		1,220.7		-20.0		-1.6%
Gross profit	323.8		346.5		-22.7		-6.6%
Operating expenses	(89.9)		(75.5)		-14.4		+19.1%
Operating profit	233.9		271.0		-37.1		-13.7%
Net finance costs	(10.6)		(5.0)		-5.6
Share of joint ventures	61.5		24.7		+36.8
Profit before tax	284.8		290.7		-5.9		-2.0%
Pre-tax return on equity	18.0%		19.1%		-1.1%
Earnings per share - basic	200.4p		201.7p		-1.3p		-0.6%
Shareholder Returns
Dividend paid / B-Share payment	23.3		451.5		-428.2
Share buy-backs	110.5		34.7		+75.8
Shareholder return in the period	133.8		486.2		-352.4

 

As a result of its forward sales at the start of the financial year and sales rates which have been ahead of last year, Berkeley anticipates delivering full year profits in line with its previous guidance of approximately £600 million. 

 

Berkeley expects its pre-tax earnings for the following two years to be at least £1.05 billion (previously approximately £1.25 billion).   This level of profitability is in line with Berkeley's objective of generating a sustainable 15% pre-tax ROE through the cycle, whilst operating margins are expected to be at normal historical levels. 

 

 

Housing Market and Operating Environment

 

Sales

 

For Berkeley, the value of underlying sales reservations for the current six month period to 31 October 2022 is 2% ahead of the levels secured throughout 2021/22 on a like-for-like basis.  As noted in June, sales in this comparative period were back to pre-pandemic levels. 

 

Since the end of September, Berkeley's sales have been 25% lower than levels experienced for the first five months of the financial year. This is a resilient performance in the context of the current market volatility and reflects the strength and depth of demand in London.

 

Pricing has remained above business plan levels throughout this period and into November, with cancellation rates rising from early-teens to around 20% in the last couple of months.  Berkeley's sales continue to be split broadly evenly between owner-occupiers and investors.

 

In line with the strength of the London market during the first half, the Group's cash due on forward sales stands at £2.33 billion as at 31 October 2022, up 7% on the £2.17 billion held at the recent year-end.  This represents the cash due on exchanged private sales contracts which will be collected over the next three financial years and excludes secured sales in St Edward and forward sales to housing associations.

 

The latest quarterly DLUHC data shows new starts in London for the 12 months to June 2022 of 21,500 (including private, PRS and affordable homes).  This remains substantially below both the current London Plan target of 52,000 per annum and the Government's identified local housing need of 94,000 per annum.

 

Land and planning

 

Berkeley has not added any new sites to its land holdings in this period, whilst one long-term site contracted on a conditional basis in Motspur Park has been added to the long-term pipeline.   

 

On the planning front, Berkeley has secured one new consent in the period; at St William's site in Worthing, Sussex for around 190 homes.  We have obtained numerous revisions to existing consents in the period as we continue to progress our sites; most notably at The Green Quarter (Ealing), White City, Hartland Village (Fleet), Hareshill (Crookham) and The Eight Gardens (Watford).

 

The Levelling Up and Regeneration Bill has continued to evolve as it progresses through Parliament, with a number of significant amendments tabled in recent weeks. We support the Government's key objectives for reform, which are to further encourage a brownfield first approach, improve the quality of new homes and the new places created, and to better engage communities in the plans made for their area. This does, however, need to be balanced with the societal need for more homes and wider benefits they bring. Consequently, we are concerned that any weakening of the presumption in favour of sustainable development and the status of five year land supply targets will reduce the pace of delivery of new homes. This will create uncertainty, less predictability of outcome and less stability, which will lead to lower investment going forward.

 

As a brownfield focused developer we welcome the Government's recent announcement of a review into what further measures would prioritise the use of brownfield land. We will continue to make the case for an efficient, delivery focused, planning and regulatory system that is able to meet the needs of local people through bespoke design led negotiations on strategic development sites, for which we believe S106 agreements remain an essential tool.

 

Similarly, we have consistently argued that design codes make sense for new additions to existing neighbourhoods, but that where a new neighbourhood is being created it is more appropriate to engage in a bespoke, design led, approach. This will better engage the local community than an abstract conversation, it will maximise the benefits of a site, and ensure new development is built to an appropriate density.

 

Inevitably during a period of transition there is a pause as stakeholders seek to understand the new system. We therefore hope the reform agenda has now reached a settled position that is able to command broad support in order to create a settled planning environment as soon as possible, providing confidence for all stakeholders. 

 

Construction

 

Material cost inflation has begun to reduce, but this varies considerably by product, with those which are energy-intensive in their manufacture or in high demand remaining at elevated levels.  Labour cost inflation has been benign relative to materials inflation and, despite the ongoing wider inflationary environment for consumers, we do not expect labour costs to substantially increase from this point given the softening outlook for the construction sector.

 

Overall, despite the fact that high increases in some materials will continue, we expect build cost inflation to start to moderate during 2023 from the current elevated levels which have been between up to 10% across our portfolio on a blended basis for some time. 

 

Berkeley Modular continues to produce the first modules at its modular factory in Northfleet, which will be delivered to Kidbrooke Village during the New Year and is working with the numerous statutory bodies to achieve the various regulatory approvals required for efficient future delivery.

 

Fire Safety

 

Berkeley has been very supportive of Government in its determination both to ensure buildings are fire-safe for people to live in and mortgageable so they can move home and re-mortgage their properties when they wish. Berkeley's focus in this area has been on ensuring its buildings achieve the required EWS 1 form certification for mortgage purposes and it has obtained this on 99% of its relevant freehold buildings.

 

Earlier in the year, Berkeley welcomed the withdrawal of the Consolidated Advice Note, which had created much uncertainty in this process, and its replacement by PAS9980, a proportionate risk-based approach that has the support of the wider industry.  Based upon this approach and assurances from Government about its fair and equitable implementation, Berkeley signed the Developer Pledge.  The Pledge commits signatories to take responsibility for remediating life-critical fire safety issues, based upon the PAS 9980 assessment, on buildings it developed over 30 years which Berkeley is fully committed to and progressing.  Berkeley is carrying out PAS9980 assessments on all relevant buildings and will undertake any works necessary to address life-critical fire safety issues.

 

The Pledge also commits signatories to assume responsibility for remediating buildings accepted by Government into the Building Safety Fund and to meet historic funding commitments Government has made on certain of these buildings. It is Berkeley's preference to take full responsibility for all its buildings and complete any required works ourselves as determined by a PAS9980 assessment as this will speed up the overall process of remediation.  There are a number of buildings that Berkeley has been asked to fund where historic funding commitments have been made for works that are not life-critical fire safety issues and we are working through these with the relevant parties.  

 

We are in detailed discussions with DLUHC in respect of the long-form contract that sits alongside the Pledge. It is in the interests of all stakeholders, including leaseholders, local and national government, banks and developers that the long form contract follows the principles of the Pledge and has both a clear standard against which buildings can be assessed for life-critical fire safety issues, and an independent dispute resolution process.

 

Government has undertaken to ensure that all developers and house-builders are treated equally and that all parties involved in the development process are held to account and pay their fair share.  Berkeley believes this is fair and equitable and is fully supportive of this approach.  With the Developer Pledge and 4% Residential Property Developer Tax ('RPDT') Berkeley believes that UK house-builders have played a very full part in resolving this issue and further levies on the industry would be unjust and constrain delivery and innovation.  We are therefore concerned to see recently that Government is continuing with its plans to introduce an additional Building Safety Levy with the target of raising a further £3 billion from the industry, as it will further reduce much needed investment in brownfield regeneration.

 

Looking forward, Berkeley is ensuring its procedures are compliant with new legislation and is supportive of the Building Safety Act which, together with the actions taken to date, should restore trust and confidence to the housing market, enabling it to operate efficiently, effectively and be fair for all.

 

Outlook

 

Berkeley ends the period in a robust position with good visibility of near-term earnings underpinned by £2.3 billion of cash due on secured private sales.  We have unrivalled land holdings in the most fantastic city in the world that suffers from a systemic under-supply of new homes, providing resilience to the sales market.

 

In these uncertain times, Berkeley has a very clear strategy; realising its forward sales, matching supply to demand, adding value to its existing land holdings and pipeline sites, protecting operating margins and focusing on cash generation ahead of the income statement.

 

We will also continue to serve our customers and the communities in which we work, delivering new neighbourhoods on brownfield land that stitch these neglected parts of our cities back into the local fabric, bringing new amenities and using land in the most efficient and sustainable way.

 

The delivery of new private and affordable homes is a force for good, generating better health outcomes, new jobs and skills, economic growth and social mobility which benefits the whole of society.  Its importance needs to be fully recognised.

 

 

Rob Perrins

Chief Executive

 

TRADING AND FINANCIAL REVIEW

 

Trading performance

 

Revenue of £1,200.7 million in the period (2021: £1,220.7 million) arose primarily from the sale of new homes in London and the South East. This included £1,185.8 million of residential revenue (2021: £1,199.7 million) and £14.9 million of commercial revenue (2021: £21.0 million).

 

2,080 new homes (2021: 1,828) were sold across London and the South East at an average selling price of £560,000 (2021: £647,000) reflecting the mix of properties sold in the period. 

 

The gross margin percentage is 27.0% (2021: 28.4%), reflecting the mix of developments.  Overheads of £89.9 million (2021: £75.5 million) include St William overhead following the acquisition in March 2022. The operating margin has decreased to 19.5% (2021: 22.2%), moving towards the historic range.  

 

Berkeley's share of the results of joint ventures is a profit of £61.5 million (2021: £24.7 million), with St Edward's profits arising predominately from completions at Royal Warwick Square and Milbank.

 

The Group has remained cash positive on a net basis throughout the period. Net finance costs were
£10.6 million for the period (2021: £5.0 million) due to facility fees, interest on borrowings and imputed interest on land creditors, which continues to outweigh interest income on cash deposits.

 

The taxation charge for the period is £63.1 million (2021: £50.9 million) which yields an effective tax rate of 22.2% (2021: 17.5%) following the introduction of the additional 4% residential property developer tax (RPDT) in April 2022.

 

Pre-tax return on equity for the period is 18.0%, compared to 19.1% for the comparative period.  Basic earnings per share have decreased marginally to 200.4 pence per share (2021: 201.7 pence per share), which takes account of the buy-back of 2.9 million shares at a cost of £110.5 million under the Shareholder Returns Programme.

 

Financial Position

 

The Group's net assets increased over the six-month period by £73.5 million to £3,209.6 million
(30 April 2022: £3,136.1 million):

 

Summarised balance sheet as at		31-Oct-22		30-Apr-22		Change
		£'m		£'m		£'m
Non-current assets		363.2		374.6		-11.4
Inventories		5,298.2		5,134.0		+164.2
Debtors		82.8		150.2		-67.4
Creditors		(2,877.2)		(2,791.6)		-85.6
Capital employed		2,867.0		2,867.2		-0.2
Net cash		342.6		268.9		+73.7
Net assets		3,209.6		3,136.1		+73.5
Shares, net of treasury and EBT		108.6m		111.3m		-2.7m
Net asset value per share		2,956p		2,818p		+138p

 

Inventories

 

Inventories of £5,298.2 million include £919.7 million of land not under development (30 April 2022: £738.1 million), £4,259.6 million of work in progress (30 April 2022: £4,255.1 million) and £118.9 million of completed stock (30 April 2022: £140.8 million).

 

The increase in land not under development in the period arises from the completion during May and June of a further 11 sites into St William as part of the transaction in March 2022, which are represented by land creditors.  There is one further St William site which will complete in 2025.  No sites have been moved into production during the period.  

 

Creditors

 

Total creditors of £2,877.2 million include £939.2 million of on-account receipts from customers (30 April 2022: £931.4 million) and land creditors of £929.1 million (30 April 2022: £800.7 million), with the latter's increase represented by the completion of the St William sites noted above.  Of the total £929.1 million land creditor balance, £69.8 million is short-term and £859.3 million is spread over the following nine years.

 

Creditors also include provisions of £175.3 million (30 April 2022: £161.0 million) which represents post-completion development obligations and other provisions.

 

Net cash

 

The Group ended the period with net cash of £342.6 million (30 April 2022: £268.9 million), an increase of £73.7 million:

 

Abridged Cash Flow for the period ended		31-Oct-22
		£'m
Profit before taxation		284.8
Taxation paid		(67.3)
Net investment in working capital		(13.7)
Net distribution from joint ventures		6.2
Other movements		(2.5)
Shareholder returns		(133.8)
Decrease in net cash		73.7
Opening net cash		268.9
Closing net cash		342.6

 

The net cash of £342.6 million consists of gross cash holdings of £1,002.6 million, net of £660 million of long-term borrowings.

 

Net assets and NAVPS

 

Net assets increased over the six-month period by £73.5 million, or 2.3%, to £3,209.6 million
(2022: £3,136.1 million) primarily due to the profit after tax for the period of £221.7 million outweighing the shareholder returns of £133.8 million (comprising £110.5 million share buy backs and £23.3 million dividends) and other movements in reserves of £14.4 million.

 

The shares in issue, net of treasury and EBT shares, closed at 108.6 million compared to 111.3 million at the start of the period.  The net reduction of 2.7 million shares comprises two movements:

 

·         The 2.9 million share buy-backs undertaken during the period for £110.5 million (£37.61 per share);

·         The issue of 0.2 million shares under the 2011 LTIP.

 

Consequently, the net asset value per share is 2,956 pence, up 4.9% from the 2,818 pence at 30 April 2022.

 

Funding

 

The Group's borrowing capacity is unchanged from the recent year-end at £1,200 million, comprising:

 

·        £400 million unsecured 10-year Green Bonds which mature in August 2031 at a fixed coupon of 2.5% per annum;

·       £800 million banking facilities, comprising a £260 million Green Term loan and a £540 million undrawn revolving credit facility ('RCF'). These facilities are in place for a period of five years to February 2027, with two one-year extension options available.

 

Berkeley has allocated the proceeds of the Green Bonds and Green Term Loan to its ongoing development activities in accordance with its Green Bond Framework (available on its website).

 

With total borrowings of £660 million, the Group's gross cash holdings of around £1.0 billion are placed on deposit with its relationship banks.

 

Joint Ventures

 

Included within non-current assets are investments in joint ventures accounted for using the equity method which are at £184.2 million at 31 October 2022 (30 April 2022: 190.4 million). The net £6.2 million reduction in the period arises from three movements:

 

·        Berkeley's share of profits earned in St Edward of £61.5 million;

·        Berkley's share of cash distribution from St Edward of £74.9 million;

·        Berkeley's share of cash contributions to site specific joint ventures of £7.2 million.

 

In St Edward, 251 homes were completed in the period at an average selling price of £1,036,000 (2021: 109 homes at £889,000).  The completions occurred at Royal Warwick Square and Millbank in London, Hartland Village in Fleet, Green Park Village in Reading and Highcroft in Wallingford. 

 

In total, 5,156 plots (30 April 2022: 5,317 plots) in Berkeley's land holdings relate to seven St Edward developments, three in London (Westminster, Kensington and Brentford) and four outside the Capital (Reading, Fleet, Wallingford and Guildford). The sites in Brentford and Guildford are contracted on a conditional basis subject to planning.

 

Land Holdings and Pipeline

 

Berkeley's land holdings comprise 64,121 plots at 31 October 2022 (30 April 2022: 66,163 plots), including the St Edward joint venture.  Of these land holdings, 60,956 plots (30 April 2022: 62,998) are on 81 sites that are owned and included on the balance sheet of the Group or its joint venture, or is unconditionally contracted in the case of one St William site.  The remaining 3,165 plots (30 April 2022: 3,165) are on three contracted sites which either do not yet have a planning consent or have another conditional element such as vacant possession.

 

The plots in the land holdings at 31 October 2022 have an estimated future gross profit of £8.16 billion (30 April 2022: £8.26 billion), which includes the Group's 50% share of the anticipated profit on St Edward's joint venture developments.  The future gross profit has reduced in the period as the gross profit taken through the Income Statement has exceeded optimisation and market movements, with no new sites added in the period.  The future gross margin is at 26.5% at the end of the period (30 April 2022: 26.5%).

 

In addition, Berkeley has approximately 8,500 plots on seven sites (30 April 2022: 8,000 plots on six sites) that constitute its pipeline, having conditionally contracted one long-term site in the period.

 

The status of the 81 owned and unconditionally contracted sites is:

 

·      55 sites (plots: 44,680) have an implementable planning consent and are in production;

·    14 sites (plots: 9,175) have a consent which is not yet implementable, due to practical technical constraints and challenges surrounding, for example, vacant possession, CPO requirements or utilities provision; and

·      12 sites (plots: 7,101) do not have a planning consent.

 

Of the three contracted sites, one site has a resolution to grant consent, but remains subject to a call-in.

 

The estimated future gross margin represents management's risk-adjusted assessment of the potential gross profit for each site, taking account of a wide range of factors, including: current sales and input prices; the political and economic backdrop; the planning regime; and other market forces; all of which could have a significant effect on the eventual outcome.

 

 

Our Vision 2030: Transforming Tomorrow

 

Our Vision 2030 is Berkeley's ambitious long-term strategy, which sets ten strategic priorities for the business over the current decade.  It is designed to drive our performance, spur innovation and reinforce our position as the country's most sustainable developer through maximising our positive impacts on society, the economy and the natural world.

 

Driving ambitious carbon action

 

Berkeley's climate action programme is driving our progress towards our science-based carbon reduction targets and we were delighted to be recognised with a Carbon Reduction Award at the Better Society Network's cross-sector National Sustainability Awards 2022.  We have a CDP Climate Action and Transparency Leadership level rating of "A-".

 

Direct emissions - within our own operations (scopes 1 and 2) we continue to focus on energy efficiency, with a particular emphasis on site set up and out of hours usage. We have purchased biodiesel HVO on 95% of our sites as a lower carbon alternative to diesel, saving 600 tCO2e in this half year period.  When combined with our supply chain consumption on our sites, the saving is 2,250 tCO2e in this half year period.

 

Embodied carbon - following the completion of 15 detailed life cycle carbon assessments (scope 3 category 1) last financial year, we have now set quantitative targets to reduce embodied carbon for new developments.  Life cycle assessments will now be completed on new developments, helping us to gain further insight and work towards meeting our science-based targets.

 

We remain committed to a just transition to net zero, which means working collaboratively with our existing UK-based suppliers and the UK energy sector as they decarbonise, rather than switching procurement to countries with a cleaner energy sources and lower embodied carbon products.

 

Low carbon homes - we continue to deliver efficient homes (scope 3 category 11) through a fabric-first design approach, in combination with the most appropriate technology and infrastructure solution for each site. We are implementing the requirements of the 2021 Building Regulations (effective June 2022 with 12-month transitional arrangements) and preparing for the more stringent Future Homes Standard.

 

We continue to engage with industry to meet this important challenge through participation in the UKGBC's Advancing Net Zero Programme and as Chair of the sector group of the Net Zero Carbon Building Standard Homes Group.

 

Supporting nature's recovery

 

We are proud to pioneer nature recovery within our industry and to play a proactive role in reversing biodiversity loss within the communities we serve.  We have built up a pipeline of  49 developments committed to biodiversity net gain, which together will deliver over 500 acres of new or measurably improved natural habitats.

 

We are evolving our approach, having commissioned and embedded new best practice landscape design guidance from the Wildfowl and Wetlands Trust (WWT) on incorporating blue and green infrastructure within our masterplans. This is enabling both our customers and the natural environment to benefit from the wealth of biodiversity supported by these habitats. We are honoured to be a founding member of the WWT's Blue Recovery Leaders Group, working to restore, improve and create more wetland habitats.

 

Communities and social value

 

Our ambition on every site is to strengthen the local community, support people's health, wellbeing and quality of life and deliver lasting social value that can be felt both within and beyond our site boundaries.

 

85% of our projects involve the regeneration of brownfield land in the heart of existing towns and cities. Reviving these well-connected sites helps to reenergise surrounding communities and deliver new homes, jobs, amenities and growth where they are most sustainable and most needed. 

 

Examples include Oval Village, previously a disused gasworks, where we are currently welcoming residents to the first private and affordable homes and delivering 2.5 acres of public space, a 179% biodiversity net gain, a mix of public amenities and flexible employment space to support 1,000 permanent jobs.

 

Every new masterplan and wider placemaking strategy is informed by our bespoke social value tool and we continue to embed Community Plans on every regeneration site to help connect neighbours and create inclusive, fun and resilient places. Examples of Community Plan initiatives include Royal Arsenal's Platinum Jubilee street party which brought together 2,000 Woolwich residents and mental health awareness events and exercise classes at Hartland Village in Hampshire. 

 

Future skills

 

We welcomed 77 apprentices, graduates and sponsored students to our future skills programmes in autumn 2022 and currently have 9% of our employees in earn and learn roles, in addition to around 300 trainees working on our sites through our supply chain. This performance secured Gold Member status from The 5% Club.

 

We continue to promote careers in the built environment sector and inspire new talent to join our hugely rewarding and varied industry through a range of programmes and events. Recent initiatives include partnering with Young Professionals to bring 150 students to West End Gate in Westminster to experience a live regeneration site and learn about built environment career opportunities. We are also supporting the Royal Borough of Greenwich and SHCH Sixth Form to help young people with learning disabilities take their first steps into employment.

 

Increasing the diversity of our workforce is a priority and we continue to apply the principles and commitments of the Mayor's Fund for London's Diversity Pledge and work in partnership with Women Into Construction.

 

The Berkeley Foundation

 

The Berkeley Foundation (the "Foundation") is our registered charity established to support young people and their communities in the areas where we work. The Foundation enables Berkeley to channel its skills, resources and fundraising efforts towards ambitious, impactful voluntary sector partnerships.

 

We are acutely aware that high inflation is putting added pressure on vulnerable households and the fantastic voluntary sector partners which support them.  The Berkeley Foundation has continued to support our charity partners over the period, which work closely with the communities around our sites to tackle inequalities and create opportunities for those in greatest need.

 

Highlights for the Foundation within the period include the launch of a new three-year partnership with Groundwork London to engage disadvantaged young people to enhance local green community spaces and prepare them for careers in the green economy.

 

Principal risks and uncertainties

 

The principal business risks and uncertainties facing Berkeley for the next six months are the same as those set out on pages 87 to 101 of The Berkeley Group Holdings plc Annual Report for the year ended 30 April 2022.  These comprise the economic and political outlook, the impact of regulation on the business and the wider industry, the availability of land, the planning process, retention of our people, securing sales, liquidity and working capital management, mortgage availability, climate change and sustainability considerations, health and safety on the Group's developments, product quality, control of build costs and maintaining programmes, and cyber and data risk.   In preparing this interim report, full account has been taken of this risk profile and the future outlook for the Group's developments as embraced within the Group's strategy and outlook.

 

 

 

- End -

 

 

Statement of Directors' Responsibilities

 

This statement, which should be read in conjunction with the independent review of the auditors set out at the end of these condensed consolidated interim financial statements (the "interim financial statements"), is made to enable shareholders to distinguish the respective responsibilities of the Directors and the auditors in relation to the interim financial statements which the Directors confirm have been presented on a going concern basis.  The Directors consider that the Group has used appropriate accounting policies, consistently applied and supported by reasonable and appropriate judgements and estimates.

 

A copy of the interim financial statements of the Group is placed on the website of The Berkeley Group Holdings plc: www.berkeleygroup.co.uk. The Directors are responsible for the maintenance and integrity of the information on the website. Information published on the internet is accessible in many countries with different legal requirements. Legislation in the United Kingdom governing the preparation and dissemination of the financial statements may differ from legislation in other jurisdictions.

 

The Directors confirm that this condensed set of interim financial statements has been prepared in accordance with International Accounting Standard 34, "Interim Financial Reporting", as adopted by the United Kingdom and that the interim management report includes a fair review of the information required by DTR 4.2.7R and DTR 4.2.8R, namely:

 

·     an indication of important events that have occurred during the first six months and their impact on the condensed set of financial statements, and a description of the principal risks and uncertainties for the remaining six months of the financial year; and

 

·    material related party transactions in the first six months and any material changes in the related party transactions described in the last annual report.

 

The Directors of The Berkeley Group Holdings plc are listed in the Annual Report of The Berkeley Group Holdings plc for the year ended 30 April 2022. A list of current Directors is maintained on The Berkeley Group Holdings plc's website.

 

 

On behalf of the Board

 

 

 

 

R C Perrins

Chief Executive

9 December 2022

 

 

 

 

R J Stearn

Finance Director

9 December 2022