In a trading update today the house builder issued a profit warning as it flagged the ongoing impact of macroeconomic uncertainty which it expects to last until October at least.

The firm said: “The Group remains confident that it is well positioned to navigate the economic uncertainty. However, as a consequence of lower expected profitability, it is in the early stages of seeking temporary banking covenant relaxation.

“Discussions with the Group’s lenders have commenced and a further update will be provided in due course.”

Crest Nicholson said it now expects sales numbers to fall from 1,400 to 1,500 units compared to previous guidance of 1,550 to 1,700 units as build costs increase and interest rates stay high.

Land buyers are also more cautious with revenue from land sales now expected to be £40m from £75m to £100m.

The firm now expects to achieve an EBIT for the financial year of around £5m to £15m, with interest costs of £15m and a revised year end net debt position of £100m to £120m.

The group has recently cut around 50 jobs shut divisions and overhauled its strategy in a shift out of volume house building into mid-market homes under its Project Elevate turnaround plan.

Martyn Clark, CEO, said: “We remain committed to our strategy of positioning Crest Nicholson as a leading player in the mid-premium housing market and continue to make good progress on our Project Elevate transformation initiatives.

“However, it is increasingly clear that the current macroeconomic uncertainty is contributing to the prospect of a more prolonged higher interest rate environment, renewed cost pressures and a deterioration in consumer confidence.

“Therefore, in the near term the right and prudent course of action is to adapt quickly to the challenges presented by the current trading environment and focus on prioritising cash generation and optimising our balance sheet position.

“We are doing what needs to be done to navigate this uncertainty to best position the business to deliver the attractive medium-term opportunity.”