Bovis Homes

Bovis Homes Group plc

[Name of Instructor]

Table of Content

Introduction1

Financial Performance2

Company's capital structure3

Debt Financing of Company4

Company's Market Valuation5

WACC5

Calculation for Bovis Homes WACC5

Capital Asset Pricing Model5

Calculation of Bovis Homes CAMP7

Problems with CAMP7

Rappaport Share Value Analysis7

Scenario Analysis8

Activity Based Costing9

Bovis Home's Dividend Policy12

Conclusion12

Recommendations12

References14

Appendices 115

Appendices 217

Appendices 317

Appendices 417

Bovis Homes Group plc

Introduction

Bovis Homes is one of the UK's most incredibly successful house manufacturers and the association has built a fortunate notoriety for the value of its construct and objective, association's elevated detail and mindful client utility. Bovis Homes unit go is expansive and adaptable, with objectives that might be developed and acclimates to meet the adapting requires of the business, the client and nature in which team raise.

From one and a few sleeping room apartments to five and six room disconnected clan homes, Bovis Homes portfolio combines mentor houses, town houses, and homes for first time purchasers and for the retired. Group additionally specialise in recovery conspires, working nearly in partnership with a broad go of lodging companionships, gathering and different open segment bureaus to furnish competitive, value EcoHome standard homes in tolerable, tan field areas.

The Bunch is pleased with its notoriety and history which extends back something greater than a century to when it was first made in London in 1885 by Charles William Bovis. Bovis Homes now work in four districts crosswise over the UK. Bovis Homes' groups in Mid, South West and South East districts are all based in provincial work places, a considerable number of with supporting satellite zone business settings. Bovis Homes is a builder of high quality traditional homes in England and Wales. The Group's business involves the design, build, and sale of new homes for both private customers and Registered Social Landlords. The Group employs over 500 staff directly and around a further 2,500 sub-contractors work on its sites on a daily basis. In 2011, the Group legally completed 2,045 homes on a mixture of Greenfield and brown field sites (www.bovishomes.co.uk/)..

Financial Performance

The Group has achieved excellent progress during the past year, especially in the context of a challenging market environment. Mortgage availability continued to be heavily constrained, particularly in respect of first time buyers. Consumer confidence was adversely affected due to rising unemployment, high inflation, and ongoing political and economic issues within Europe. The Group's profitability has increased significantly in 2011 with the benefit of increasing revenue, strong cost control, and an increase in sales outlets. Profit before tax increased by 74% to £32.1 million as a result of a greater number of legal completions at an increased average sales price and an improved profit margin. With a strong balance sheet with net cash of £50.8 million, the Group has an excellent platform from which to grow significantly the returns to our shareholders.

Earnings per share for the year have grown by 65% to 17.5p. Consistent with the intention to increase dividends progressively as earnings per share increase, the Board will be recommending a final dividend of 3.5p per share, which, when combined with the 2011 interim dividend of ...