Legal & General appoints new CEO at Scottish house builder following sixth consecutive year of strong performance
Kevin Whitaker has been appointed as the new chief executive at CALA Group as the housebuilder delivered a sixth consecutive year of strong performance.
Announcing an update on trading for the twelve months to 30 June 2018, the first since full acquisition by Legal & General, CALA said it had maintained the positive momentum generated during the first six months (1 July – 31 December 2017) of its 2018 financial year over the important spring selling season.
In the twelve months to 30 June 2018, private completions rose 23% to 1,620 (2017: 1,322) and private ASP reduced to £463,000 (2017: £497,000) due primarily to site mix and the planned transition away from homes priced above £1 million where trading is generally more difficult. Affordable housing activity also rose substantially in the year, which included a 55% increase in completions to 551 (2017: 355).
Private revenue per site per week during the period, a far more meaningful metric of CALA’s sales performance given the group’s size relative to that of its larger peers, was £277,000; an increase of 2% on the prior year (2017: £271,000). Private sales per active site per week for the financial year were 0.62 (2017: 0.56).
The group continues to have relatively limited direct exposure to Help to Buy with only 16% of private sales completed using the product during the period (2017: 14%). CALA expects that this figure will rise modestly over the coming years, albeit still significantly below the levels experienced by its listed peers, as the group increases the number of homes it builds and expands the breadth of product built on its sites.
As at 30 June 2018 the group had secured 499 forward private reservations – 31% up on last year’s figure – with a GDV of £211m (2017: 382 private units with a GDV of £179m).
Graham Reid, interim chief executive of CALA Group, said: “The past twelve months have been a landmark year for CALA. The continued strength of our performance produced a sixth consecutive year of outstanding delivery, while we were also able to further expand our growth targets based on our consistent track record and investment in the business in recent years.
“The overall market backdrop for CALA has remained broadly supportive and we enter the remainder of the extended financial year in a positive position, with a healthy level of forward private reservations. Looking ahead, we remain confident of continuing our strong growth momentum with the benefit of the backing of Legal & General, one of the most highly-respected, blue-chip investors who shares our long-term vision.”
Following the recent retirement of previous group chief executive Alan Brown in April 2018, the Board has confirmed the promotion of Kevin Whitaker to the role, assuming all CEO responsibilities as at 1 August 2018.
Kevin, currently one of two regional chairs, has worked for CALA since 1999, having previously been managing director of CALA Homes East and land director with CALA Homes Scotland before that.
Kevin Whitaker, group chief executive of CALA Group, said: “I am extremely proud that Legal & General has appointed me as CALA’s chief executive. Having spent 19 years with the company, I know about the quality of our people, culture, strategy and the homes we build, and I am very excited to get started as we continue to grow the business and deliver on our strategy.
“Legal & General’s investment in the remaining part of CALA is the start of an exciting new chapter for the group and our strong track record of delivery, combined with our growth strategy, means that we are well placed to build on the excellent momentum we have generated in recent years.”
Legal & General Group acquired the 52.1% of CALA Group which it did not previously own in March 2018.
The transaction valued CALA at £605m and followed the group’s strong delivery in 2017, which saw the business achieve revenues of £747.9m alongside an operating profit of £92.8m.
Kerrigan Procter, chief executive officer of Legal & General Capital, said: “We are delighted to appoint Kevin as CALA’s chief executive as we look to continue to build on the Group’s strong growth momentum. Having been a key member of the management team over the past eleven years, he knows the business inside out and shares our long-term vision, which will be invaluable to continuing to develop and grow CALA.
“I would also like to place on record Legal & General’s thanks to CALA’s finance director, Graham Reid for stepping into the interim chief executive role and overseeing the continuation of CALA’s strong trading performance.”