Building delays to hit gross sales at Taylor Wimpey

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UK housebuilder Taylor Wimpey expects dwelling completions to drop 40 per cent this yr due to disruption attributable to coronavirus.

The corporate needed to shut its constructing websites in March and though they’re now open once more, they’re solely working at 80 per cent of manufacturing capability due to social-distancing measures.

“A typical Taylor Wimpey web site has about 100 individuals. However we are able to essentially handle to have 100 individuals [at the moment],” Pete Redfern, chief government, mentioned on Wednesday, including that the issues had been extra acute at websites the place flats had been being constructed.

Mr Redfern expects manufacturing capability to rise by the autumn, however the building delays will hit gross sales this yr and there will even be a knock-on influence in 2021.

He welcomed a possible extension to the federal government’s Assist to Purchase scheme, as it could assist first-time patrons who had reserved properties however could not be capable to full the acquisition by the December deadline because of building delays.

Regardless of these delays, Taylor Wimpey mentioned gross sales had been recovering and that buyer curiosity in its properties was holding up properly.

“Demand has been very resilient,” mentioned Mr Redfern. “A major variety of individuals simply wish to transfer on to the subsequent stage of their lives and that features shopping for a home.”

Mr Redfern’s feedback got here as Taylor Wimpey reported outcomes for the primary half of the yr. The housebuilder mentioned the pandemic had “a fabric influence on our monetary efficiency”. Income for the interval greater than halved to £755m as the corporate offered fewer houses, whereas the £300m pre-tax revenue within the first half of final yr turned a £40m loss.

Analysts at Liberum mentioned Taylor Wimpey’s overheads had been “better than we anticipated”.

There was no first-half dividend.

Shares dropped greater than 7 per cent to 124p on Wednesday morning, and are down 37 per cent within the yr so far, though they’ve recovered from the low of 102p reached in April.

The corporate raised £510m in a share putting in Could to reap the benefits of alternatives within the land market as smaller opponents pull again. “We now have signed off 26 websites since we restarted land shopping for in Could,” mentioned Mr Redfern. “It’s a a lot sooner run fee than we might have felt snug with with out that further capital.”

He mentioned there have been notably enticing alternatives within the south-east of England.

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