Residential property developer Oakdene Homes has followed a £15 million placing at £2 with news of strong annual profits growth.

AIM-quoted Oakdene, which focuses on the South East of England, increased pre-tax profits 60 per cent to £8.2 million in 2006 on turnover up 8 per cent at £46 million. The Reigate-based company had grown by acquisition of companies and projects in 2004 and 2005, and concentrated on developing them in 2006. Chairman Philip Stephens and chief executive officer Carl Turpin now intend to use the placing proceeds to acquire more ‘strategic sites to produce returns in 2009 onwards’.

With staff numbers doubling during the year, Oakdene began construction work at Newhaven, its biggest development so far; the first of whose three phases comprises 105 flats and six shops. A 300-berth marina also features, managed by a team formerly from Sea Containers.

The company, which has begun selling direct rather than through agents, said it has received plenty of expressions of interest from potential buyers, though there has been a ‘slight delay’ in obtaining detailed planning permission for part of the development. Elsewhere, Oakdene has a profit-sharing agreement with Heritable Bank to develop luxury flats at Swaylands, a listed building at Penshurst in Kent.

After a ‘very strong’ housing market ‘for most of 2006’, Stephens said the company’s building schedule for 2007 will ensure ‘we have many more units for sale’. He acknowledged current concern over rising interest rates, a traditional damper on the property market, but points to the ‘substantial lack of new housing’, especially in Oakdene’s areas, asserting, ‘We are confident that, while the market may stabilise, there is unlikely to be any reduction in the sale prices we are achieving on our developments.’

At 211.5p, Oakdene shares are up 4.5p today and have risen 38 per cent since Growth Company Investor’s recommendation a year ago. They could well outperform several sector peers.

Oakdene Homes	AIM	£6.02m	12.00p	0.00p
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