Interim Management Statement

RNS Number : 3483F

Taylor Wimpey PLC

21 April 2011

 



21 April 2011

Taylor Wimpey plc

Interim Management Statement

Taylor Wimpey plc is holding its Annual General Meeting at 11:00am today in London, where the following comments will be made regarding current trading, financial performance and the outlook for the financial year.  In line with the requirements of the UK Listing Authority's Disclosure and Transparency Rules, this Interim Management Statement covers the period from 1 January 2011 to the date of this announcement.

The Group as a whole is performing in line with our expectations.  We remain focused on delivering margin improvement from the existing land portfolio in the UK and adding new sites where good opportunities are identified.

UK Housing

Market conditions in the UK remain resilient despite the ongoing uncertainty in the wider economy and the restricted level of mortgage lending.  We are working with mortgage lenders to identify innovative ways of increasing mortgage supply and we have made good progress in signing up further lenders to our 'Take5' insurance-backed 95% mortgage product, which we launched in February.

We are currently operating from just over 300 outlets, compared to 290 this time last year, and have seen a continuation of the encouraging trends in visitor levels, sales rates, cancellation rates and selling prices reported at our full year results.

We remain focused on maximising the value achieved from each home completion and we have achieved further improvement in the margin on sales in our order book.  The current order book stands at 5,681 homes (31/12/2010: 4,684 homes).

We maintain our consistent, disciplined approach to land acquisition and have approved the purchase of 2,937 new plots on 23 new sites since the start of 2011.  We are engaging with the government and with local authorities to deliver an implementable planning system that is capable of delivering a higher level of new homes in the longer term, whilst recognising the challenges of transition.  We are also realigning our business to ensure that it is well positioned to benefit from the opportunities that the proposed new planning system will provide.   

North America Housing

As announced following our General Meeting on 18 April 2011, our shareholders have approved the disposal of our North American business.  This disposal remains conditional on the receipt of North American government and regulatory approvals together with the satisfaction of customary conditions.  We continue to work with the buyers in order to achieve completion which we anticipate will take place by the end of the second quarter of 2011.

Current trading in our North American operations has seen a continuation of the trends highlighted in our full year results announcement and the business is trading in line with our expectations.

Spain Housing

Market conditions remain challenging in Spain with restricted mortgage lending and the strength of the Euro against Sterling, although we have been encouraged by a modest improvement in trading since the start of the year.

Group financial position

Net debt at 31 March was £817 million, reflecting an investment in land, a reduction in land creditors and an increased investment in work in progress in line with the more usual seasonal trading patterns in the UK.  We expect this to reduce significantly by the half year following the receipt of the proceeds of the disposal of our North American business and scheduled home completions in the UK.

Board changes

With effect from today, as previously announced, Kate Barker CBE will join the Board as an Independent Non-Executive Director and Andrew Dougal and Katherine Innes Ker will stand down as Independent Non-Executive Directors.

Outlook

We expect a relatively flat market in the UK over the remainder of 2011.  We expect to make further progress in delivering value from our existing land portfolio and the completion of the disposal of our North American business will put us in a strong position to add new sites where attractive opportunities are identified.  We remain on track to achieve our target of double-digit operating margins in the UK in 2012, subject to continuing stable market conditions.

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For further information please contact:

Taylor Wimpey plc                                                                  Tel: [phone]

Pete Redfern, Group Chief Executive

Ryan Mangold, Group Finance Director

Jonathan Drake, Investor Relations

Finsbury                                                                                  Tel: [phone]

Andrew Dowler

Clare Hunt

Notes to editors:

Taylor Wimpey plc develops communities in the UK, North America and Spain. It aims to be the developer of choice for customers, employees, shareholders and communities.

For further information, please visit the Group's website:

www.taylorwimpeyplc.com

 

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