Cohesive Consistent Confident

Henry Boot PLC
Annual Report and Financial Statements for the year ended 31 December 2015
www.henryboot.co.uk
Stock Code: BHY
Performance
Q
You have a published
aim to achieve and
maintain a return on
capital employed of
between 10-13% as
a benchmark of a
successful business in
the property sector.
How have you
progressed this year
and do you see any
factors that could affect
this ongoing target?
A
A strong overall operating profit
increase of 13.3%, helped in
particular by our strategic land
division, has generated a return on
capital employed of 12.2% (2014:
11.4%).
This higher return was achieved on a 5.6% higher
level of capital employed as we build our business
strength.
Our return on capital employed is impacted by our
profit margin and the rate at which we generate
sales from our assets. We are continually looking
at ways to reduce our cost base across all of our
businesses and actively look to improve efficiencies
through the use of new technologies and working
practices. Margins remain highly competitive within
the construction segment and the future price of
both materials and labour has a large impact here.
Within the land segment the speed at which assets
can be disposed of is highly dependent upon the
planning system and the appetite of the major house
builders for new land, whilst the property segment
is subject to the market demand for new property,
the residential sales arena and the speed with which
large and often complex development schemes can
be brought to fruition.
Darren Littlewood
Group Finance Director
32