LONDON, April 21 (Reuters) – Persimmon (PSN.L: Quote, Profile, Research, Stock Buzz), Britain’s biggest housebuilder, reported a rebound in sales as homebuyers returned to the market after bad weather and an uncertain outlook froze activity at the end of 2010.

Persimmon said reservations taken in the year-to-date had risen 12 percent compared with the same period last year, thanks to a steady-flow of visitors and low cancellation rates.

“Our sales rates have picked up. To be 12 percent ahead in this period, it shows the market is there. It’s still a challenging market but those numbers are good for us, and it brings us back to where we stood at this time last year,” Chief Executive Mike Farley told Reuters.

Housebuilders have reported a more robust selling environment so far in 2011 with smaller peer Redrow (RDW.L: Quote, Profile, Research, Stock Buzz) reporting encouraging sales on Tuesday and supported by positive retail data in March. [ID:nLDE73H0Q0] [ID:nAHLKFE7FW]

But poor mortgage availability continues to drag on housing transactions, particularly the first-time buyer market.

Gross lending for home purchases rose 21 percent in March from February and the industry body said it expected mortgage credit availability to improve this quarter. But on the year, mortgage lending fell 2 percent. [ID:nLDE73J0JR]

FOCUS ON LAND

LONDON, March 9 (Reuters) – British engineering and construction firm Costain (COSG.L: Quote, Profile, Research, Stock Buzz) said it has not pulled out of the bidding for Mouchel (MCHL.L: Quote, Profile, Research, Stock Buzz), despite the support services group turning to Interserve (IRV.L: Quote, Profile, Research, Stock Buzz) as preferred suitor.

“We haven’t walked away and we are very much in an offer period,” Chief Executive Andrew Wyllie told reporters on a results conference call.

But Costain added it was also pursuing a number of large acquisition targets after reporting a 54 percent rise in profits last year to 27.9 million pounds ($45 million).

Costain was rejected by Mouchel despite improving on its previous proposal of 0.5531 Costain shares plus 30 pence in cash for each Mouchel share, with the target turning instead to an unspecified alternative offer from maintenance and outsourcing group Interserve. [ID:nLDE71O0TY]

“We are the preferred offeror at this stage of the game, so at this stage there’s no reason to suggest that that could change,” Interserve’s chief executive Adrian Ringrose told Reuters on Wednesday, after reporting a decline in its 2010 profit, citing challenging conditions. [ID:nLDE7231DP]

Ringrose added that he sees no further Mouchel developments for a number of weeks as it carries out due diligence.

“We are concentrating on the only thing that we can concentrate on, which is the value that we see in that business and making sure that we’ve got that right. If that’s right then we will likely proceed,” said Ringrose.

LONDON (Reuters) – British testing firm Intertek (ITRK.L: Quote, Profile, Research, Stock Buzz) is buying quality and safety services firm Moody International for $730 million (450 million pound) in cash to expand its offering to the energy industry.

Intertek, which also reported forecast-beating full-year profits up 11 percent, said the acquisition would drive expansion in two key areas, industry services and system certification.

“It’s about high-single digit (percentage growth); that’s our usual growth rate, and we can also have it in the energy sector with the acquisition of Moody,” Chief Executive Wolfhart Hauser told Reuters.

“It is an important strategic move for Intertek,” said Kevin Lapwood at Seymour Pierce, citing the global reach as a key benefit of the acquisition.

Intertek, which tests a range of products from toys and footwear to computers, said Moody’s system certification business would give it a presence in Asia, and the takeover is expected to materially enhance earnings next year, while generating pretax synergies of 6 million pounds by year three.

Shares in Intertek were up 4.53 percent at 0947 GMT, the highest gainer on the FTSE 100.

Intertek, which operates in over 100 countries and counts as clients the government of Mozambique and companies such as Carrefour (CARR.PA: Quote, Profile, Research, Stock Buzz), Gap (GPS.N: Quote, Profile, Research, Stock Buzz) and Unilever (ULVR.L: Quote, Profile, Research, Stock Buzz), said adjusted pretax profit for the year to end-December was 211.9 million pounds ($345 million) compared with 191.5 million a year earlier.

LONDON/ISTANBUL (Reuters) – Britain’s Costain Group Plc (COSG.L: Quote, Profile, Research, Stock Buzz) is the likely target of Renaissance Construction, as the Turkish building group seeks a partner with deep roots in high-potential markets.

Board chairman Erman Ilicak said last month that Renaissance, one of Turkey’s three largest construction groups, was in early-stage talks to take a controlling stake in an unnamed, 140-year-old British company.

Ilicak told reporters the potential target specialized in building nuclear plants, railways and water networks and had annual revenue of 1.5 billion euros.

The detailed description, analysts say, points squarely at Costain: “It’s difficult to come up with too many more suggestions (other than Costain),” said Panmure Gordon analyst Andy Brown.

Costain’s bid to buy Mouchel (MCHL.L: Quote, Profile, Research, Stock Buzz) failed recently, after the struggling support services firm struck an alternative deal with Interserve Plc (IRV.L: Quote, Profile, Research, Stock Buzz).

Brown said the “bid shadow” of Renaissance could also explain Costain’s reluctance to go hostile in its pursuit of Mouchel.

One wrinkle, however, is a gap in valuation: Costain’s market value is about 150 million pounds ($245 million), compared with a 300 million euro ($417 million) value cited by Ilicak.

LONDON/ISTANBUL, March 3 (Reuters) – Britain’s Costain Group Plc (COSG.L: Quote, Profile, Research, Stock Buzz) is the likely target of Renaissance Construction, as the Turkish building group seeks a partner with deep roots in high-potential markets.

Board chairman Erman Ilicak said last month that Renaissance, one of Turkey’s three largest construction groups, was in early-stage talks to take a controlling stake in an unnamed, 140-year-old British company.

Ilicak told reporters the potential target specialised in building nuclear plants, railways and water networks and had annual revenue of 1.5 billion euros. [ID:nLDE7191H2]

The detailed description, analysts say, points squarely at Costain: “It’s difficult to come up with too many more suggestions (other than Costain),” said Panmure Gordon analyst Andy Brown.

Costain’s bid to buy Mouchel (MCHL.L: Quote, Profile, Research, Stock Buzz) failed recently, after the struggling support services firm struck an alternative deal with Interserve Plc (IRV.L: Quote, Profile, Research, Stock Buzz). [ID:nLDE71O0TY]

Brown said the “bid shadow” of Renaissance could also explain Costain’s reluctance to go hostile in its pursuit of Mouchel.

One wrinkle, however, is a gap in valuation: Costain’s market value is about 150 million pounds ($245 million), compared with a 300 million euro ($417 million) value cited by Ilicak.

LONDON, March 3 (Reuters) – Balfour Beatty (BALF.L: Quote, Profile, Research, Stock Buzz) is looking to its professional services business to drive growth in markets such as India and Australia after the British infrastructure firm’s profits rose 20 percent last year.

A strong balance sheet means that the group has the firepower to make bolt-on acquisitions, particularly in new or emerging markets that are pivotal for global contractors as Western markets lag.

“We are looking at the growth strategy, that is an organic strategy, but from time to time, there are opportunities to give that growth a kickstart,” Chief Executive Ian Tyler told Reuters, citing its purchase of Canadian professional services firm Halsalls as a model for future deals.

The group bolstered its professional services capacity with the acquisition of U.S. firm Parsons Brinckerhoff in 2009.

Tyler said the group was on track to achieve cost savings of 30 million pounds ($49 million) by end-2012. Its order book rose 8 percent to a record 15.2 billion pounds last year.

Balfour Beatty, which operates in 80 countries, offers a range of infrastructure services. It is moving towards higher margin businesses such as design and consulting, known as professional services.

Tyler said that most medium-term growth would be focused around the professional services division, with markets such as India and Australia and sectors such as mining a key priority.

LONDON, March 1 (Reuters) – British housebuilder Persimmon (PSN.L: Quote, Profile, Research, Stock Buzz) put its weight behind signals of an improving market this year, in defiance of mortgage data that showed home loans still well below long term trend levels.

“We’re encouraged by the market place, visitor levels are 10 percent up … sales today are 2 percent ahead than this point last year,” Chief Executive Mike Farley told Reuters as the company reported profits rebounding in 2010 thanks mainly to improved margins and a strong performance from its high-end Charles Church brand.

“It’s been evenly spread across the country, that’s encouraging,” he added, after sales in 2010 were mainly driven by a rebound in the southeast.

Farley said he was comfortable with analyst consensus forecasts of margins at 9 percent this year, after they rose to 8.2 percent from 4 percent in 2009.

Economists are predicting a testing year for housebuilders and muted growth at best, as economic uncertainty and a struggle to access credit deter buyers from entering the market. [ID:nSLASCE7NR]

And the Bank of England said on Tuesday that mortgage approvals picked up more than expected in January but that approvals are still running at only half their long-run average. [ID:nAHLSDE7DY]

SHARES DOWN

LONDON, Feb 28 (Reuters) – Ground engineering company Keller Group (KLR.L: Quote, Profile, Research, Stock Buzz) said the downturn in global construction activity cut its annual profit by nearly half, with government cutbacks set to crimp any rebound in the short-term.

Keller, which helped prepare the ground for the Palm-Jumeirah Island in Dubai and Melbourne’s Eureka Tower, posted an annual underlying pretax profit of 39.6 million pounds ($63.84 million).

This compared with a consensus of 40.7 million, according to a poll of 8 analysts supplied by the company and a profit of 74.7 million pounds in 2009.

Weak construction markets in the U.S. and Europe were to blame for the year-on-year drop in profits, Keller said on Monday. “We do not anticipate a rapid return to pre-recession levels of construction spend,” it said

The group’s order book was 13 percent ahead year-on-year at the end of January but Keller warned that the medium-term outlook would remain challenging as the full impact of government cutbacks is felt.

Revenue growth will return in 2011 in the U.S., Eastern Europe and Asia, offset by a slight decline in Australia and Western Europe, but overall margin weakness is dragging on the outlook.

“We expect consensus for FY 2011 to drift down 5-10 percent towards our estimates. This is driven by margin weakness across the developed world and a slightly weaker performance in Australia,” said analysts at Liberum Capital.

LONDON (Reuters) – British support services company Interserve has made a cash-and-shares approach to peer Mouchel to create a UK outsourcing powerhouse, trumping construction firm Costain.

Maintenance group Interserve said Friday it had inked a “co-operation agreement” with design consultancy Mouchel and discussions over the offer were continuing.

Mouchel said Thursday it was in advanced talks with an unnamed potential buyer, prompting a denial from Costain that it was the party involved.

Costain’s last formal approach was 164.6 pence per share, valuing Mouchel at 185 million pounds, but in Costain’s statement Thursday it indicated that it had had a revised approach rebuffed.

“Given this we believe any offer from Interserve which involves the issue of shares is likely to be above 170 pence,” said analysts at Brewin Dolphin.

“Costain’s sweetener was around 30 pence so you would think Interserve’s would have to be better,” a source with knowledge of the situation told Reuters.

The move by Interserve may trigger a bidding war.

LONDON, Feb 24 (Reuters) – British housebuilder Barratt Developments (BDEV.L: Quote, Profile, Research, Stock Buzz) reported a pick-up in trading since the start of year as it posted sharply lower first-half losses. “We have made a good start to the second half of the financial year with a significant pick-up in trading since the depressed autumn period,” said Chief Executive Mark Clare.

It echoed comments from smaller peer Redrow (RDW.L: Quote, Profile, Research, Stock Buzz) which was upbeat on the outlook for the spring season after reporting a big uptake in sales this year. [ID:nLDE71G0AU]

A positive start to the year and a subsequent buoyant spring would bring relief to the sector, after a weak autumn trading period was exacerbated by bad weather in December.

But economists are predicting another tough year with muted growth at best, as economic uncertainty and expensive mortgage financing deter buyers. [ID:nSLASCE7NR]

“We’re running the business in an extremely tight framework imposed by a lack of mortgage finance availability,” said Clare.

“It’s doubly frustrating it remains harder to borrow money on new homes than second-hand homes. That’s a discrimination that needs addressing as soon as possible,” he said.

Mortgage approvals were flat year on year, at very low levels, in January. [ID:nLAL004649]