IT has been a busy month at Gold Coast listed residential developer Villa World Limited (ASX:VLW).
An upgraded profit guidance, purchase of a new development project and the resignation of a long serving director Troy Harry headlined the month.
With the upgraded profit guidance, the company indicated sales are so strong it will be beefing up production, but even then it may not be able to keep up.
VLW is expecting a Net Profit before Tax of between $17.5 and $19.5 million for FY14, compared to a Statutory Net Loss after Tax of $13.5 million for last financial year - an increase of up to 74 per cent against Underlying Operating Profit Before Tax of $11.2 million in FY13.
The company has carried forward 217 sales worth $80.8 million into FY14 and has made a further 424 sales worth $157.6 million to November 30. It remains cautious, however, noting in a statement the market remains volatile.
Demand is stronger for completed dwellings, though there s increasing demand for off-the-plan product at some projects and therefore sales may depend on the company's construction capacity and it is accelerating this construction activity where possible.
Restocking is a priority for the company and five site acquisitions have been made and settled since July 2012, adding 579 lots to the development pipeline. Three projects have been released for sale and sold strongly.
The company has also entered an unconditional contract for the purchase
of a development site at Pakenham, with approval for 291 residential lots, in the growth corridor of south east Melbourne.
The purchase price is $9.5million (including GST), with settlement expected towards the middle of 2014 following the completion of works by the vendor.
Harry, a non-executive director of the company since 2009, resigns effective March 31, to go on a long term holiday with his family.
In preparation for his holiday, Harry is making some adjustments to his investment portfolio, including his shareholdings in the Company.
The board is searching for his replacement, in addition to the recent appointment of Mark Jewell as an independent nonâ€executive director.
VLW has enjoyed a strong year on the share market, with its share price rising to a 52 week high of $2.03 per unit late in the year (up from 75 cents in January), but it is trading 1.34 per cent down at $1.835 per unit today.
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