TIDMTW.
RNS Number : 7480F
Taylor Wimpey PLC
09 November 2022
9 November 2022
Taylor Wimpey plc
Trading statement
Overview
Jennie Daly, CEO, commented:
"In a challenging economic and political backdrop we are
performing well and are on track to deliver full year operating
profit* in line with market expectations(1) .
While sales rates have been impacted by wider economic
uncertainty, we continue to see good levels of customer interest in
our homes and a desire to get onto or move up the housing
ladder.
Taylor Wimpey is an agile business and we have been focused on
operational efficiency and execution. We operate from a position of
financial strength and as we continue to navigate the current
macro-economic challenges, our quality landbank in customers'
preferred locations positions us well. We will continue to manage
the business with discipline as we seek to deliver value for all
our stakeholders."
UK trading performance
We achieved a net private sales rate of 0.74 homes per outlet
per week for the year to date (2021: 0.95) and 0.51 homes per
outlet per week in the second half of the year to date (2021:
0.91), reflecting customer response to heightened levels of
economic uncertainty.
The cancellation rate for the second half of the year to date
was 24% (2021: 14%), with a year to date cancellation rate of 18%
(2021:14%).
As at 6 November 2022, our current total order book excluding
joint ventures stood at c.GBP2.6 billion (2021: c.GBP2.8 billion)
and our order book represented 9,153 homes as at 6 November 2022
(2021: 10,643) of which 79% is exchanged.
Customer visits to our website continue to be at good levels,
albeit with conversions taking longer. Where customers have locked
in mortgage rates, they remain keen to complete their purchase.
In the year to date, we have operated on an average of 229 sales
outlets (2021: 224), and we are currently operating from 234
outlets (2021: 217) having opened 74 new outlets in the year (2021:
64 ).
Prevailing build cost inflation remains around 9-10%.
Proactive response to changing market conditions
We have been closely monitoring the market and lead indicators,
and have acted decisively and proactively to mitigate risk through
the levers available to us. We have further increased cost control,
increased management controls and focused our sales teams for
selling in a tougher market.
With a strong land position, we can continue to be highly
selective in our landbuying. A s a result, year to date approvals
total c.7k plots, similar to our half year position. We will
continue to operate on a highly selective basis in the land
market.
As at the end of October 2022, our short term landbank stood at
c.86k plots (3 July 2022: c.88k) and our strategic land pipeline
stood at c.145k potential plots (3 July 2022: c.145k). This strong
land position gives us options in all market conditions.
We have a strong balance sheet and are highly cash generative.
Reflecting the proactive actions taken, we now expect to end the
year with net cash ** of c.GBP800 million.
Outlook
With resilient pricing in the order book and a focus on cost
discipline, we expect to deliver operating profit in line with our
expectations. We expect Group volumes to be at broadly similar
levels to 2021, given the uncertainty in the market. We remain on
track to increase our outlet numbers at the end of the year which
will provide us and our customers with increased choices and gives
us the flexibility to respond quickly to changing market
conditions.
Higher mortgage rates will contribute to the wider cost of
living challenges affecting our customers. Despite the more
challenging short term conditions, we remain confident in the long
term sector fundamentals with a continued meaningful supply and
demand imbalance in UK housing.
Taylor Wimpey is financially strong with an excellent, well
located landbank and a highly experienced management team with a
focus on protecting value while driving further operational
efficiency. We remain well placed to navigate the current
challenges, deliver quality homes to our customers and long term
growth and value to our stakeholders.
(1) As published on 7 November 2022, the Company compiled
consensus expectation for full year 2022 Group operating profit
including joint ventures and excluding exceptional items is
c.GBP922 million.
* Operating profit is defined as profit on ordinary activities
before net finance costs, exceptional items and tax, after share of
results of joint ventures.
** Net cash is defined as total cash less total borrowings.
Note:
2021 relates to 2021 equivalent trading period, unless
stated.
-Ends-
CEO Jennie Daly and Group Finance Director Chris Carney will be
hosting a conference call with Q&A for analysts and investors
at 9.00am on 9 November 2022. The call will be recorded and
streamed live to our website:
https://www.taylorwimpey.co.uk/corporate/investors/results-and-reports
For further information please contact:
Taylor Wimpey plc Tel: +44 (0) 1494 885656
Jennie Daly, CEO
Chris Carney, Group Finance Director
Debbie Archibald, Investor Relations
Andrew McGeary, Investor Relations
FGS Global TaylorWimpey@fgsglobal.com
Faeth Birch
Anjali Unnikrishnan
James Gray
Notes to editors:
Taylor Wimpey plc is a customer-focused homebuilder, operating
at a local level from 23 regional businesses across the UK. We also
have operations in Spain.
For further information please visit the Group's website:
www.taylorwimpey.co.uk/corporate
Follow us on Twitter @TaylorWimpeyplc
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END
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