House builder Cairn Homes announces new €40m share buyback scheme and interim dividend

Irish listed housebuilder Cairn Homes has said it is planning a €45 million share buyback programme and will announce a 3.8 cent interim dividend per ordinary share when its interim results are announced on September 4th.

The share buybacks involves a new scheme of €40 million and the remaining €5 million of a programme from last year. The programme will commence today.

In terms of trading, Cairn said it has closed 894 unit sales generating revenue of €365 million in the first half of 2024, a 66 per cent year-on-year increase in revenue.

Its closed and forward order book has increased to about 3,100 new homes with a net sales value of nearly €1.2 billion.

Cairn also noted that the State’s Land Development Agency had included it in its housebuilder partnership framework panel for Project Tosaigh 2, which is targeting the delivery of 5,000 affordable homes in the near-term. And that it added a fourth lender, Home Building Finance Ireland, to its increased €327.5 million sustainability-linked syndicate facility.

The company reaffirmed its full year guidance for 2,200 units, an operating profit of €145 million; and a return on equity of 15 per cent.

Commenting on the H1 2024 trading update, Michael Stanley, chief executive, said: “Cairn experienced a very strong spring sales season for first time buyer homes, which has added to our order book of over 3,000 homes. We will grow our output by 30 per cent this year and invest heavily in 10 new site commencements, including eight in the second half of 2024.

“The current ill-health of the rental market perhaps remains a greater challenge for our economy and growing population. In recent years, more than 70,000 homes previously for private rental are no longer available, the majority having been purchased by homebuyers from smaller landlords exiting the market.

“Privately funded replacement stock, particularly apartments in urban areas has been very low and as a result, many of Ireland’s young and fully employed population are faced with a shrinking and illiquid rental market.”

Mr Stanley noted “stronger support” from Government for new cost rental apartment developments, which he said “can significantly boost the delivery of affordable and private scaled apartment developments for both ownership and rental”.