Taylor Wimpey’s operating profits almost halved last year to £470.2m, according to its latest results.
The results reflect a challenging market for housebuilders, but there are some signs of market improvements.
Taylor Wimpey’s full-year revenue fell 20.5% to £3.5bn, while net cash was 21.5% lower at £677.9m.
Jennie Daly, chief executive of the developer, said: “We delivered a good full-year performance in line with expectations, despite a challenging market, benefitting from our sharp operational focus, the quality of our homes and locations and a continued proactive sales effort.
“It is still early in the year and the macroeconomic backdrop remains uncertain, however it is encouraging to see some signs of improvement in the market, with reduced mortgage rates positively impacting affordability and customer confidence.”
The builder said it was “poised for growth from 2025”, although it expects a further fall in sales this year to around 9,500 to 10,000 homes.
The company’s shares fell early on Wednesday following the results.
Expert reaction
Aarin Chiekrie, equity analyst at Hargreaves Lansdown, said: “Taylor Wimpey put in a relatively resilient showing given the difficult market conditions of 2023. Full-year operating profits came in at the top end of group guidance, but this still represents a roughly 50% fall from the prior year’s levels.
“A combination of real house price declines and lower mortgage rates have helped to ease some of the affordability pressures for buyers since the beginning of 2023, and these trends appear to have carried into the new year.
Richard Hunter, head of markets at interactive investor, added: “Housebuilding is a cyclical industry that is currently near the low point of the cycle, which tends to lead to the survival of the fittest, with Taylor Wimpey remaining in that camp.
“The torrid backdrop of more recent times is well-known, with higher interest rates, lower consumer confidence and general cost-of-living pressures all working against the industry.
“The tide could be turning, and while Taylor Wimpey is not calling for anything approaching a full recovery, there are some encouraging signs.
“The important spring selling season is imminent, one that traditionally welcomes in a spike of activity, while reducing mortgage rates given the likely interest rate cuts in the UK later this year should improve not only affordability but also consumer confidence more generally.”
