Taylor Wimpey year-end profits to rise 75%

Aaron Morby 12 years ago

House builder Taylor Wimpey has delivered a sharp rise in operating profits despite completing just 2% more homes last year.

In a statement on end of year trading, Taylor Wimpey said margins had topped 10% again and forecast operating profit would soar 75% for 2011.

The firm also reported stronger trading at the end of the year and first two weeks of 2012.

This saw its order book rise 17% against last year giving the builder more confidence to boost housing starts in 2012.

Pete Redfern, group chief executive, said: “In 2011, we have taken the opportunity to focus on our strategy of driving value for shareholders through margin improvement and improving return on capital.

“It is pleasing to have reached our double digit operating margin target ahead of schedule and to be well-placed to deliver further improvement, providing that market conditions remain broadly stable.”

Home completions edged up to 10,180 from 9,962 in 2010, of which 20% were affordable housing (2010: 18%).

The house builder’s average selling prices on private sales rose marginally to £185k from £184k, against a backdrop of broadly stable house prices in the wider market.

The first two weeks of trading in 2012 had followed the encouraging patterns of the second half of 2011, with good visitor levels, healthy reservations and low cancellations, said Redferm

The house builder entered 2012 with 314 outlets compared to 301 at the start of last year.

“Our primary goal with new outlets continues to be to optimise planning consents and value-engineer sites prior to opening and we continue to prioritise margin performance over volume growth.

“However, we anticipate that our stronger order book, recent land acquisitions and planning approvals on strategic sites will enable us to increase our outlet numbers during 2012 and deliver further growth in completions, subject to ongoing stable market conditions.” said Redfern.

Taylor Woodrow’s landbank remains little changed  at 6.4 years judged on present building rates.

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