Taylor Wimpey reiterated full-year guidance in its trading update in May, reporting continued recovering demand in the UK’s housing sector and higher sales.
Things, though, have moved on apace in the housing sector since then and how the housebuilder’s tone has changed will be the focus of its interims next week.
Key things to look for are recent reservation trends; the outlook for 2023; and pricing and how it compares to prevailing build cost inflation.
Margins are another area of concern, says UBS. Taylor Wimpey is yet to guide on margins for 2023 and there is currently a wide range in consensus earnings (consensus pre-tax range for 2023: £380-534mln; average £432mln).
UBS expects expect volumes (ex-JVs) to be down 32% at 4,479 (45% of our 2023E forecast of 9,872), average selling prices of £319,000 (+6% ) and sales of £1,489mln.
The bank is also forecasting interim underlying earnings (EBIT (inc-JVs) of £195mln at a margin of 13.1% (20.4%) and pre-tax profit of £190mln.