Street Calls of the Week
Investing.com -- Cairn Homes (LON:CRN) on Wednesday raised its full-year 2025 guidance after posting a drop in first-half profit, citing strong demand from first-time buyers that lifted its order book to €1.54 billion.
The Irish homebuilder now expects revenue of about €945 million and operating profit of €160 million to €165 million this year, compared with previous forecasts of more than 10% revenue growth and about €160 million in operating profit.
Revenue for the six months ended June 30 fell 18% to €284.5 million from €347.1 million a year earlier, as the company completed 708 units compared with 893 in the first half of 2024. The average selling price was €387,000, little changed from €388,000 a year earlier.
Gross profit decreased to €63.1 million from €80.4 million, with the gross margin narrowing to 22.2% from 23.2%.
Operating profit dropped to €42.7 million from €61.4 million, producing an operating margin of 15.0%.
Profit after tax was €31.7 million, down from €46.9 million. Basic earnings per share came to 5.1 cent.
Cairn used €118.6 million in operating cash flow and reported net debt of €307.4 million at the end of June, compared with €157 million a year earlier.
Construction work-in-progress rose to €435.0 million from €318.6 million, following major site commencements in 2024.
The board declared an interim dividend of 4.1 cent per share, an 8% increase from 3.8 cent last year, payable Sept. 19.
Cairn also completed a €45 million share buyback program in January, repurchasing 803,939 shares at a cost of €1.8 million.
The order book grew to 4,092 homes valued at €1.54 billion as of Sept. 2, up from €910 million at the start of the year.
Private weekly sales averaged 4.1 homes per active site. Build cost inflation is expected to be about 1% to 1.5% in 2025, lower than earlier guidance of 2%.
Cairn issued guidance for 2026 of revenue between €1.02 billion and €1.05 billion and operating profit of €175 million to €180 million.
The results came alongside government policy updates, including a July review of the National Development Plan, which raised capital investment to €102.4 billion through 2035.
Of that, €36 billion is allocated to housing, local government and heritage between 2026 and 2030, with annual capital funding for the department set to rise from about €4.6 billion in 2025 to about €7.2 billion by 2030. Planning and rent legislation reforms were also introduced earlier this year.
Mortgage approvals and drawdowns for house purchases reached their highest levels since the financial crisis in the year to the second quarter, supporting housing demand.
Cairn noted strong take-up across developments in Dublin, Kildare, Meath, Cork and Galway.