Telford Homes Plc (AIM:TEF), the residential property developer in East London noted for regeneration projects within public sector partnerships, is pleased to give the following trading update ahead of its preliminary results for the year ended 31 March 2011 which will be released on 1 June 2011.
Completed £70 million banking facility with RBS, HSBC and Santander on 31 March 2011
Steady sales environment continues in East London
Reduced activity during the recession has, as expected, led to a fall in the number of open market completions achieved in the year to 281 (2010: 389)
Full year figures anticipated to be in line with market expectations
Four developments with Homes and Communities Agency grant now completed with final grant tranches received
New £70 million bank facility
The Board is delighted to announce that the Group completed a new £70 million banking facility with The Royal Bank of Scotland, HSBC and Santander on 31 March 2011. This facility lasts for three and a half years until 30 September 2014. The initial drawdown of just over £30 million has repaid loans held with both RBS and Allied Irish Bank and leaves headroom of £40 million for future site acquisitions and development costs.
Securing finance is extremely difficult given the current banking climate and many developers are struggling to access funds. It is a significant indication of the strength of Telford Homes that, after a year of extensive investigation of every aspect of the business and its financial position, these three major banks are prepared to support the Group to this extent.
The housing market in East London remains steady and the Group is pleased to report that new sales have been achieved in line with the forecast for the year. Due to the Group's reduced activity during the recession the number of open market completions in the year has, as expected, fallen to 281 (2010: 389). The Board anticipates that the results for the year to 31 March 2011 will be in line with market expectations.
In addition the Group has completed the first four developments under its grant agreement with the Homes and Communities Agency ("HCA") and all of the final grant tranches on those developments, totaling £8.2 million, have now been received.
Andrew Wiseman, CEO of Telford Homes, commented: "The Board is delighted to have signed the new £70 million banking facility with RBS, HSBC and Santander. This is a great achievement in the current banking climate and gives us significant headroom to add to the development pipeline for future years. We are also pleased to observe that the market in East London has remained steady, and as a result the Group has performed in line with expectations during the year."
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