McInerney pre-tax profits increase by 26% to €26m

PRE-TAX profits at McInerney increased by 26% to €26 million in 2003, according to Davy Stockbrokers.

McInerney Holdings is scheduled to release its 2003 results on Tuesday and Davy analyst Florence O’Donoghue said the company had produced earnings growth of 32% per annum since 1997.

“We envisage earnings growth of 26%, with the seasonally strong second half accounting for around two-thirds of the year’s earnings,” she said. Ms O’Donoghue believes higher levels of house building activity will be the primary driver of the results. Referring to the company’s trading statement in January, she said McInerney sold 1,481 private housing units in 2003. This represents a 28% increase on 2002.

“The substantial increase in British sales is expected to result in another bumper increase in profit contribution. We are pencilling in UK EBIT of €7.5m, up from €4.9m in 2002 despite negative currency translation effects,” she said. Ireland remains its core market, accounting for 65% of private housing sales and Davy expects Ireland will account for about 70% of operating profits.

“Not surprisingly, private housing sales will be the foundation of the Irish performance. In 2003, 969 houses were sold in Ireland, up 10%, and any upside to the results may come from the Irish house-building margin. We have cautiously pencilled in a margin of 11.3%.

“Beyond the 2003 figures, attention will naturally focus on the group’s view of its prospects for 2004. We expect the group to remain upbeat.”