Broadthorpe, the holding company that runs builder William Davis, has seen its profits rise courtesy of the late 1990s property boom. The company suffered from a number of loss-making contracts in 1995 but its policy of buying up cheap land when prices were low was rewarded when land and house prices rose from 1996 onwards. The Loughborough-based company’s profits grew by 47% pa, from £1.3m in 1996 to £4m in 1999, while sales rose just 8% in the same period to £52.8m. Profit growth was helped by the company’s decision to use its stock of cheap land to build high margin three- and four-bedroom homes. The company also landed a series of profitable contracts, including the £20m redevelopment of Leicester’s Bede Island and the construction of a 240-room accommodation block for the city’s De Montfort University. Finally, William Davis benefited from working with housing associations on a 12-year, 345-house project south of Birmingham, which helped boost profits further by delivering economies of scale.
This profile reflects the company at time of publication and does not reflect any changes that may have subsequently occurred. Fast Track and its sponsors do not endorse, guarantee or recommend investment in any of the companies.