First-half revenue rose 2% to £1.7bn (£1.6bn expected). This was driven by a 7% increase in average selling prices to £334,000 due to favourable regional and product mixes, which more than offset a 5% decline in completions to 4,986 homes.
Underlying operating profit fell 19% to £130mn (£107mn expected), as cost inflation weighed on margins.
Free cash outflows improved from £65mn to £11mn, reflecting better cash retention. The net cash position roughly halved to £0.2bn.
Full-year UK completions guidance was lowered to 10,600-10,800, the bottom half of its previous range. Cost inflation is expected between 3-4%. No underlying operating profit guidance was mentioned (previously: around £400mn), but market forecasts are sitting much lower at £321mn.
The distribution policy has been lowered to 4% of net assets (previously: 7.5%), with a minimum of 2% allocated to dividends and further 2% to either dividends or share buybacks. An interim dividend of 1.2p per share was announced, down 74%, alongside a new £42mn share buyback.
The shares fell 4.4% in early trading.
Our view
HL view to follow.
Taylor Wimpey key facts
All ratios are sourced from LSEG Datastream, based on previous day’s closing values. Please remember yields are variable and not a reliable indicator of future income. Keep in mind key figures shouldn’t be looked at on their own – it’s important to understand the big picture.
This article is original Hargreaves Lansdown content, published by Hargreaves Lansdown. It was correct as at the date of publication, and our views may have changed since then. Unless otherwise stated estimates, including prospective yields, are a consensus of analyst forecasts provided by LSEG. These estimates are not a reliable indicator of future performance. Yields are variable and not guaranteed. Investments rise and fall in value so investors could make a loss.
This article is not advice or a recommendation to buy, sell or hold any investment. No view is given on the present or future value or price of any investment, and investors should form their own view on any proposed investment.