Taylor Wimpey (TW) is letting the cash do the talking. Alongside bumper half-year profits, the housebuilder announced a £50m increase in its 2015 cash return, now £250m. "Our shareholders wanted more capital returned and that's exactly what we are delivering," says group finance director Ryan Mangold.
Strip out write-backs on the landbank and pre-tax profits rose 64 per cent to £178m. That reflects the buoyancy of the housing market in London and the south east: completions rose 11 per cent to 5,766 homes, while the average selling price increased 10 per cent increase to £206,000. The government's Help to Buy scheme is also helping, having accounted for a full 42 per cent of private sales during the half. Mr Mangold says the group was further convinced to return cash by the extension of the scheme to 2020, from its original 2016 expiry date.
At the end of June, the order book - the value of homes reserved but not yet finished - stood at £1.58bn, up 26 per cent on a year earlier. Citigroup reckons Taylor Wimpey's entire land bank, to which it added 11,531 plots during the period, reflects potential revenue of about £35bn at current house prices. The broker expects full-year pre-tax profit of £418m, giving EPS of 9.6p (from £268m and 5.6p in 2013).
| Taylor Wimpey (TW) | ||||
|---|---|---|---|---|
| ORD PRICE: | 115p | MARKET VALUE: | £3.7bn | |
| TOUCH: | 115-115.4p | 12-MONTH HIGH: | 131p | LOW: 95p |
| DIVIDEND YIELD: | 0.6% | PE RATIO: | 15 | |
| NET ASSET VALUE: | 72p | NET DEBT: | 2% | |
| Half-year to 29 Jun | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 | 1.01 | 143 | 3.60 | 0.22 |
| 2014 | 1.19 | 197 | 4.70 | 0.24 |
| % change | +18 | +38 | +31 | +9 |
Ex-div: 20 Aug Payment: 25 Sep | ||||
