28 February 2024
If you are covering Taylor Wimpey’s latest results, please see the following comment from Oli Creasey, property analyst at Quilter Cheviot:
"Taylor Wimpey’s full year results don’t contain too many surprises but paint a picture for 2024 that doesn’t look too different to 2023, and potentially a little worse.
"The company guided to an operating profit of c. £470m in January, which has been confirmed this morning. The dividend payout for the year is 9.58p, a yield of almost 7%, which was ahead of market expectations.
"2024 has started out on a reasonable footing, with a sales rate of 0.67x (houses sold per site per week), a little faster than the equivalent period last year. However, the company’s guidance for 2024 volumes is to sell between 9,500-10,000 homes over the course of the year. The middle of this range implies a -10% fall in volumes vs 2023.
"The story is similar for house prices. Overall prices rose +3.5% in 2023, but comments from management suggest that the profit margin will be lower in 2024 (at least in H1) as the forward order book has been sold at slightly lower prices than 2023. On the plus side, build cost inflation has effectively disappeared, with the prevailing rate of +1% effectively reduced to zero by TW’s efficiency measures.
"2023 was not a great year for housebuilders, and it is of slight concern that 2024 is looking like being marginally worse, both in terms of volume and price.
"Elsewhere, TW welcomed the CMA’s report, published earlier this week, and will cooperate fully with the investigation."
