Morning Note: Market News and Berkeley Group
Market News
US Markets were closed for a public holiday on Thursday. European futures rose, while US contracts edged down. Investors are bracing for $6.5 trillion of notional US options expiring today. The yen extended gains on a hawkish tilt from the BOJ minutes and solid CPI data. Brent dropped.
Donald Trump will decide within two weeks whether the US will join Israel in launching strikes against Iran, the White House said. Satellite images show Tehran is racing to get its oil out and filling storage tanks.
UK retail sales slumped a more-than-expected 2.7% in May from the previous month. The pound pared gains.
Trade latest: The EU is “making progress” in talks with the US, the bloc’s economy commissioner said. Canada opened the door to raising its tariffs on American steel and aluminium on July 21 if discussions stall.
Corporate: Irish billionaire Paul Coulson is nearing a deal to cede full control of Ardagh to creditors ahead of $2.6 billion in debt repayments due next year, people familiar said. SoftBank’s Masayoshi Son is seeking to team up with TSMC in a $1 trillion AI hub in Arizona. Home Depot made an offer for GMS, potentially setting off a bidding war with QXO, the WSJ reported. Eutelsat is raising €1.35 billion from the French government and other investors to help build a rival to Starlink. Banks in France face a combined dividend tax bill of as much as €5 billion, according to a lawmaker.
Berkeley Group – Full Year Results
Berkeley Group the UK housebuilder, today announced its audited results to 30 April 2025, reporting a resilient performance in a challenging housing market while maintaining strategic discipline. The Group’s Chairman Michael Dobson will be stepping down in September, Current CEO Rob Perrins will become Executive Chairman and current CFO Richard Stearn will move into the CEO role. The shares are weaker by around 8% in early trade.
Operating in undersupplied London and South-East England, Berkeley continues to deliver across varied schemes, from suburban family homes to urban mixed-use developments, supplying more than 10% of the capital’s new private and affordable housing. Its cyclical strategy, honed through large-scale brownfield regeneration, supported the group’s performance over the year.
Pre-tax profit for the year stood at £528.9 million, modestly below the prior year but slightly ahead of analyst expectations of £526.3 million. The operating margin improved to 20.1%, up from 19.5%, reflecting robust cost control and operational discipline. Net cash at the year-end was £337.3 million, underpinned by strong liquidity and growing forward sales.
The group delivered around 3,500 new homes during the year, maintaining its heavy focus on brownfield regeneration. Sales visibility remains robust, with over 75% of next year’s revenue already secured. Land holdings continue to provide long-term strength, while build cost inflation remains subdued, offering stable margin prospects. The balance sheet remains robust, with net cash of £337 million and £1.7 billion of total liquidity, supported by strong pipeline visibility and forward sale cash.
In recognition of the fast-growing private rental segment, Berkeley has now established its own Build to Rent (BTR) platform. The company has identified c.4,000 homes across 17 brownfield regeneration sites to launch and manage under this new venture, capitalising on institutional demand for well-managed rental housing.
Throughout 2025, Berkeley returned £382 million to shareholders via dividends and share buybacks, aligning with its capital return strategy. The group reaffirmed its FY2026 pre-tax profit target of £450 million, signalling confidence in delivering through the cycle.
In a leadership update, Berkeley announced that finance chief Richard Stern will succeed Rob Perrins as CEO, with Perrins transitioning to executive chair following AGM approval later this year, ensuring continuity for Berkeley’s long-term strategic vision.
While the current housing market remains subdued amid elevated interest rates, Berkeley remains well positioned. Supported by a strong order book, disciplined cost control, and strategic initiatives—including the launch of its BTR platform—the company looks to deliver sustainable growth and shareholder value moving forward.
