Henry Boot Reports Resilient 2025 with Record Land Sales and Strategic Refocus

Henry Boot 2025 results: record land plot sales, higher net debt, and a sharper strategy

Henry Boot’s unaudited 2025 numbers show a business leaning into its strengths. The group delivered record plot sales at Hallam Land, simplified the portfolio by selling Henry Boot Construction, and pushed further into industrial and logistics development. Offsetting that, Stonebridge Homes swung to a loss, development profits were lighter, and gearing moved above the company’s preferred range.

Management expects another second-half weighted year in 2026 and says the group is well placed to meet market expectations, assuming the Middle East conflict does not prolong and disrupt activity.

Key numbers investors should know

Metric (FY25 unless stated)	Outcome
Total revenue (incl. discontinued)	£307.0m (2024: £325.8m)
Profit before tax	£29.1m (2024: £30.7m)
Profit before tax – continuing operations	£26.4m
ROCE (return on capital employed)	7.5% before facility reclassification; 6.2% after
NAV per share (ex. pension surplus)	312p (2024: 312p)
Statutory NAV per share	313p (2024: 317p)
Net debt and gearing	£108.0m; 25.7% (2024: £62.7m; 14.7%)
Total dividend	7.86p (+2.1%); final 4.62p
Hallam Land plots sold	3,957 (record) at £11,414 average gross profit per plot
HBD completions (GDV)	£119m (our share: £33m); 32% pre-let/sold
Stonebridge Homes completions	185 units; operating loss £9.2m
Development pipeline (HBD)	£1.7bn GDV (our share: £1.4bn); 55% Industrial & Logistics

Hallam Land: record volumes and a planning wind at their back

Land promotion is Henry Boot’s engine room. It sources strategic sites, secures planning permission, and sells to housebuilders. In 2025 it sold a record 3,957 plots and lifted operating profit by 35% to £32.9m. The planning backdrop helped: 4,159 plots secured consent, taking the consented store to 9,024 plots, with a further 19,580 plots awaiting determination. Around 11,000 plots were submitted in 2025, with a similar push planned over the next 12 months.

Why it matters: consented plots are held at cost, so the balance sheet doesn’t reflect the value created until sale. The scale of the planning pipeline suggests visibility on future disposals. One caution for 2026 – management expects a higher mix of promotion agreements and fewer freeholds, likely pulling profit per plot below the typical £10,000 level.

HBD development and investment: steady progress, optionality building

Property investment and development (HBD) delivered £9.4m operating profit (2024: £14.9m). Completed schemes totalled £119m GDV (our share: £33m), with 32% pre-let or pre-sold. The Origin joint venture added meaningful industrial space – 449,000 sq ft across Walsall, Welwyn Garden City and Markham Vale – and is attracting occupier interest.

The committed programme starts 2026 at £66m GDV (our share: £18m), 48% pre-let/sold or under offer, with delivery weighted to H2 2026. The near-term pipeline remains healthy, headlined by Golden Valley, Cheltenham – a £98m first phase on a £1bn innovation campus expected to start this summer, supported by public funding.

On the investment side, returns outperformed the market: an 11.1% total property return versus the CBRE UK Monthly Index at 7.1%, with portfolio value (including JVs) at £119.8m and like-for-like occupancy at 97%.

Stonebridge Homes: a tough year, but green shoots appearing

Home building had a difficult 2025. Completions fell to 185, delays in detailed planning slowed outlet openings, and cost overruns hurt margins. The result was a £9.2m operating loss (2024: £1.9m profit). The group increased ownership to 62.5% in January 2025 and to 75% in February 2026, and is integrating and professionalising the business.

What to watch: early 2026 trading looks better – the net private weekly reservation rate from 29 December to 15 March was 0.43, up from 0.34. Output is expected at 200-220 homes in 2026, a step back toward the medium-term goal of 600 homes a year. The land bank has grown to 2,572 plots, but management plans selective land disposals to speed up asset turn and align sites with a premium homes strategy.

Strategic refocus, cost discipline and balance sheet

Two notable moves sharpened the group’s focus. First, the sale of Henry Boot Construction on 31 December 2025, funded via a £4.0m vendor loan, reduces risk and simplifies the portfolio to land promotion, development/investment, and home building. Second, the Future Ways of Working programme cut central overheads by 20% in 2025, with further savings expected in 2026.

The flip side is leverage. Net debt rose to £108.0m and gearing to 25.7%, above the 10-20% target range, mainly due to investment in Stonebridge’s land bank and cash outflows around the construction disposal. Management expects large land and development transactions to help reduce gearing during 2026.

Outlook and guidance: second-half weighted again

Management guides to another back-end loaded year in 2026, with company-compiled market consensus profit before tax at £20.2m. Hallam Land is expected to have another good year on volumes, albeit at lower profit per plot due to mix. HBD plans to ramp up committed activity through 2026-27, supported by the £1.4bn pipeline and Origin JV. Stonebridge should improve, though planning delays remain a headwind.

Risks to keep in mind: activity levels remain below long-term averages, the sales mix can swing profits, and the outlook references potential disruption if the Middle East conflict is prolonged. ROCE at 7.5% (6.2% post reclassification) is below the 10-15% medium-term ambition, so delivery needs to accelerate.

My take: why this update matters for shareholders

• Proof of the model: record Hallam Land sales and a much bigger planning pipeline underpin future cash generation. That is the heart of the equity story.
• Industrial focus is sensible: the Origin JV, strong occupier interest and Golden Valley give Henry Boot leverage to a recovering I&L market without overcommitting capital.
• Home building needs execution: improved reservations are welcome, but 2026 is about restoring volumes, tightening cost control and turning inventory faster.
• Balance sheet watch: gearing is above target. Management says H2 deals should bring this down – investors will want to see that progress in cash and covenant headroom.
• Dividends held steady: a total 7.86p, with the final at 4.62p, signals intent to remain progressive once earnings pick up.

What to track next

• Hallam Land transactions: 465 plots already exchanged for 2026 and 2,181 under offer – conversion and pricing will set the tone.
• HBD lettings and starts: pre-lets at Origin, commitment to Golden Valley phase one (£98m GDV), and build cost discipline.
• Stonebridge KPIs: net reservation rate, active outlets, build cost inflation, and the size/mix of the land bank after selective disposals.
• Gearing and cash: evidence that large transactions land in H2 and move gearing back toward 10-20%.

Bottom line

Against subdued markets, Henry Boot leaned on its strengths in 2025 – land promotion and industrial development – while taking tough medicine in home building and simplifying the group. The pipeline is stacked, the planning environment is more supportive, and early 2026 housing metrics are moving the right way. Delivery in the second half, tighter capital discipline, and a clearer upswing at Stonebridge are the catalysts to watch from here.