Gleeson’s update confirms a robust H1 performance despite a subdued backdrop. Gleeson Homes delivered 801 completions during H1 (H1’24: 769), with an improved net reservation rate of 0.55 (H1’24: 0.41) or 0.44 exc. bulk (H1’24: 0.39). Whilst macro conditions remain challenging, not least due to volatile borrowing costs, Gleeson Homes enters H2 with a forward order book of 597 plots (H1’24: 586 plots), which leaves it well placed for the full year. We also point to strong momentum in site openings, which supports strong medium term growth potential. As previously flagged, Gleeson Land is expected to complete all of its sales in H2. This is supported by several planning decisions expected in early H2, as well as a strong demand backdrop. With full year expectations reiterated, we continue to expect a return to double digit PBT growth in FY25. This alone should drive a higher share price but we also see re-rating potential when a more consistent end market recovery is established. We reiterate our Buy rec.
