Taylor Wimpey has reported a decrease in completions and revenue for the first half of 2024, reflecting ongoing challenges in the housing market.
The impact of higher interest rates is all too evident in Taylor Wimpey’s numbers as falling sales continued in the first half of 2024.
In the first half of 2024, Taylor Wimpey’s group completions, including joint ventures, fell to 4,728 homes from 5,120 in the same period last year. This decline in completions contributed to a decrease in group operating profit, which fell to £182.3 million from £235.6 million in H1 2023.
The company noted £18.6 million of profit generated from land sales, compared to just £2.7 million in the previous year.
Despite significant headwinds, Taylor Wimpey reported a slight improvement in its net private sales rate, which increased to 0.75 in H1 2024 from 0.71 in H1 2023. It may be too early to call the data green shoots but it will be of some solace for investors.
Looking ahead, Taylor Wimpey remains cautiously optimistic. The company expects full-year UK completions, excluding joint ventures, to be towards the upper end of its previous guidance range of 9,500 to 10,000 homes. This positive outlook is supported by a robust order book, which stood at £2,102 million as of July 28, 2024, representing 7,667 homes.
“Looking to the second half, our performance to date means we now expect to deliver 2024 full year UK completions towards the upper end of our previous guidance range of 9,500 to 10,000 and Group operating profit in line with current market expectations,” said Jennie Daly, Chief Executive.
The company is focusing on building its order book to optimize value and position itself for growth from 2025, assuming supportive market conditions. Taylor Wimpey reports excellent visibility for 2025 completions, owning and controlling all necessary land, with most having detailed planning permission.
In the medium term, Taylor Wimpey is actively preparing for potential planning changes and developing high-quality planning applications. The company has approximately 30,000 applications in the planning process and additional applications ready if proposed changes to green belt regulations come into effect.
Despite the current challenges, Taylor Wimpey remains committed to shareholder returns announcing a 2024 interim dividend of 4.80 pence per share, slightly up from 4.79 pence per share in H1 2023, which will be paid in November.