Henry Boot Profit Warning
Henry Boot forecasts 2026 loss as land sales and housebuilding slow
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Key Points
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Hallam Land first-half plot sales dropped to 556, down from 1,222 in HY25, with a further 465 plots exchanged for completion in the second half of 2026, highlighting continued caution in land acquisition by builders.
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Stonebridge Homes is now expected to incur an operating loss in 2026 due to higher mortgage rates, planning delays and around 5% build cost inflation.
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Golden Valley in Cheltenham includes the IDEA building, a 160,000 sq ft innovation centre, and the scheme is now about 68% let or under offer after work commenced in July.
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Net debt rose to £133m at the end of June, with temporary amendments already agreed to Henry Boot’s banking covenants and ongoing discussions about full-year covenant requirements.
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The company signalled a potential improvement in the second half, with higher expected home completions and delayed land sales completing later in the year, providing some near-term relief after a weak first half.
Henry Boot has warned that full-year profits will come in "significantly" below market expectations, sending its shares down 5.1% to 157.50 pence — a 13-year low not seen since early 2013, according to Morningstar. The Sheffield-based developer blamed a sharp slowdown in land sales and rising costs at its housebuilding arm for the profit miss.
The blow is severe. Plot sales at Hallam Land, its land promotion division, fell to just 556 in the first half of 2025 — down from 1,222 in the same period a year earlier, Housing Today reported. Meanwhile, its housebuilder Stonebridge Homes is now expected to post an operating loss in 2026.
Hallam Land Plot Sales More Than Halved in First Half
Henry Boot's land promotion arm, Hallam Land, saw its first-half plot sales collapse to 556 from 1,222 the year before — a drop of more than 50%, according to Housing Today. Housebuilders have been delaying land purchases. Many are asking for deferred payment terms instead of buying outright.
A further 465 plots are exchanged for completion in the second half of 2026. That offers some relief, but it also shows how far out builders are pushing their commitments. Management cited high mortgage rates, planning delays, and wider economic uncertainty — including the Middle East conflict — as weighing on confidence and deal activity.
Stonebridge Homes Set to Post 2026 Operating Loss
Henry Boot's housebuilding unit, Stonebridge Homes, faces a tough road ahead. The company now expects it to record an operating loss in 2026. Three forces are driving the pain: higher mortgage rates dampening buyer demand, planning delays slowing project starts, and around 5% build cost inflation squeezing margins, Yorkshire Post reported.
The group does expect more home completions in the second half of 2025. Some delayed land sales are also due to complete later this year. That may provide a short-term boost. But the outlook for 2026 remains difficult, with costs rising and demand fragile.
Net Debt Hits £133m, Triggering Covenant Talks With Lenders
Henry Boot's net debt climbed to £133 million at the end of June. That figure triggered discussions with the company's lenders about its banking covenants — rules that set limits on how much debt a company can carry relative to its assets or earnings, according to Morningstar. The group has already agreed temporary amendments to those covenants.
The company expects debt to fall as transactions complete and key projects move forward. Its HBD commercial property arm showed resilience, with strong demand from industrial and logistics occupiers. The Origin joint venture is now about 75% let or under offer, offering a bright spot in an otherwise difficult update.
Golden Valley Scheme Advances Despite Wider Market Gloom
One area of progress is the £95 million Golden Valley scheme in Cheltenham. Work began in July on the IDEA building, a 160,000 square foot innovation centre at the heart of the development. The scheme is now about 68% let or under offer, Yorkshire Post reported, showing that demand for high-quality commercial space remains intact.
Henry Boot said it still plans to submit around 10,000 plots for planning approval this year. Management stressed a focus on cash generation and long-term value creation. The tone was cautious but not panicked — the group believes the fundamentals of land and property development remain sound once market conditions stabilise.
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