(Adds detail, exec comments, background, shares)
By Isla Binnie
LONDON Dec 7 British housebuilder Berkeley
Group declared its first dividend since 2008 on Friday,
as strong profit growth boosted the company's confidence in its
Pre-tax profit rose over 40 percent to 142 million pounds
($228 million) in the first half to end-October, prompting
Berkeley to announce a dividend of 15 pence per share to be paid
next year, ahead of a larger planned capital return in 2015.
"We can do it all in September 2015 but we always said that
the intention is...if we can, we will return modest dividends on
the way," Rob Banks, group managing director, told Reuters.
"We've made a profit in the period so we've got more
certainty that we can achieve the first milestone."
The news helped take shares in the company to a record high
of 1,736 pence, rising over 5 percent on Friday morning, with
brokers upgrading their target prices and forecasts.
"This is not a material sum from the 1300 pence
total return but could be more significant if there has been a
policy shift to pay a more material running dividend," analysts
at Peel Hunt said in a note.
Berkeley benefits from reliably high property prices in its
core London market despite broader economic instability. While
loan conditions for buyers remain tight, the rate of mortgage
approvals rose more than forecast in October.
"London in particular is a city which remains a world centre
of excellence, culture and business, and is central not just to
Berkeley but to a recovery in the wider UK economy," Berkeley
chairman Tony Pidgley said.
($1 = 0.6219 British pounds)
(Editing by Rosalba O'Brien)