Taylor Wimpey said it is on course to achieve £470million operating profit for 2023, reaching the upper end of its forecast.
In its latest trading update released today, the housebuilder said that it had achieved this through its cost-cutting measures implemented earlier in the year, focusing on “optimising price and sharp cost discipline”.
The developer also said that it will build between 10,000 and 10,500 by the end of the year, again reaching the higher end of its forecast.
Despite the positive news, the operating profit is significantly down on the previous year’s figure, almost half of the £923million achieved in 2022. The number of houses built has also seen a substantial fall, close to a third less than the 14,154 built in 2022.
In March this year, Taylor Wimpey implemented cost-saving measures in the face of challenging market conditions, restructuring the company and closing its Oxfordshire division to save the developer around £20million a year. The developer said that it had “acted decisively and proactively” in a bid to control costs.
Jennie Daly, CEO of Taylor Wimpey, commented: “Taylor Wimpey has delivered a resilient performance in what continues to be a challenging market backdrop, reporting a robust sales rate and strong financial position and reiterating our full year 2023 UK volume guidance in the range of 10,000 to 10,500 homes. Due to our focus on optimising price and sharp cost discipline, we now expect Group operating profit to be at the top end of our guidance range of £440million to £470million. This performance is testament to the hard work of our experienced teams, who have continued to adapt and support customers through their buying journey while being focused on delivering efficiencies across the business.”
“Taylor Wimpey is a strong, sustainable and agile business underpinned by a robust balance sheet and an excellent well-located landbank. These attributes ensure we are well positioned to manage the business and optimise performance in all market conditions, delivering quality homes to our customers and long-term growth and value to our stakeholders.”
“Looking ahead, while the market backdrop remains uncertain, we are confident in the medium to long-term sector fundamentals, with a meaningful supply and demand imbalance in UK housing.”
Some in the industry believe that Taylor Wimpey’s positive figures suggest that the market downturn may finally have bottomed out, coinciding with recent positive news from Persimmon who saw a “strong pick-up” in home sales last month. Last week the Bank of England also held the interest rate at 5.25% after 14 rises to combat high inflation.
