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GOLD Coast housing company Villa World made an emphatic return to the black over the 2014 financial year with a net profit of $19.1 million, boosting returns for shareholders in the process.
The profit compares with a $13.1 million loss last year, while the pre-tax result of $22.6 million is higher than the company had expected just three months ago.
Villa World CEO Craig Treasure (pictured) says he is pleased to see strong returns for shareholders, with the company having built a loyal investor base prior to the GFC when it was known as a high-dividend stock for 20 years.
“It’s made a great profit and paid a good dividend to shareholders. It has really low gearing and plenty of capacity to deliver its projects and to acquire more.”
Shareholders also have also seen a 79 per cent increase in the value of their stock over the past year as the company’s fortunes began turning for the better early last year.
“Our strategy of growth has underpinned much of this success, with a 36 per cent increase in sales for the year.”
“While our Queensland-based projects account for the majority of our sales, the share of sales in both Victoria and NSW is increasing in line with our strategy to restock in each of the three states,” he says.
Villa World’s revenue surged 35 per cent to $229.5 million, boosted by $80.8 million in sales carried forward from FY13.
Villa World has 17 projects across the eastern seaboard, reporting strong demand across most projects.
Acquisitions have boosted the number of lots in the company’s portfolio to 3925, from 2647 a year ago, giving it about 4.7 years of sales at current levels.
“We anticipate that our acquisition strategy will replenish our inventory levels by the middle of the current financial year to meet projected market demand. This will see profit and sales weighted towards the last half of the year.
Treasure says Villa World is targeting profit growth of at least 5 per cent this financial year, providing consumer confidence remains strong, interest rates remain low and the home-buyers grants remain in place.
The company spent $89.5 million on acquisitions during the year, aided by $67.7 million in cash generated from operating activities.
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