House-builder Taylor Wimpey PLC (LON:TW. found sector peer Persimmon a hard act to follow, as its shares slumped following results.
Full-year revenue in 2017 was £3.97bn, up 7.9% from £3.68bn in 2016 and a bit ahead of the market's expectations.
Profit before tax and exceptional items clocked in at £812mln, up 10.7% from £733.4mln the previous year but below the £818mln the market had been expecting.
READ: Taylor Wimpey completes more homes in 2017 on strong demand despite Brexit uncertainty
The chief executive, Pete Redfern, said the group had been encouraged by early trading patterns at the start of 2018, adding that “despite some wider macroeconomic uncertainty, consumer confidence remains robust and market fundamentals are solid”.
Notwithstanding that, the net private sales rate for the year-to-date was down to 0.81 compared to 0.91 in the same period of 2017, although Taylor Wimpey said the rate remains in line with its expectations for 2018.
The house-builder ended the year with net cash of £511.8mln, up 40.3% from £364.7mln the year before.
“Whilst we have seen no adverse impact on trading, we are conscious of the wider political and economic risks. We are confident that our well-capitalised balance sheet together with our high-quality land-bank with outlets located in places where demand is high and where people want to live provides the flexibility and resilience needed to manage all types of market conditions through the cycle,” the company said.
Leasehold scandal
Neil Wilson at ETX Capital said it was a strong set of result, “although as expected stated profits were lower because of the provision for helping customers affected by the leasehold scandal”.
“The order book of 8,415 homes is a touch lighter than the 8,573 for the same period last year. A bit of caution on the outlook re Brexit etc., but even with the Bank of England set to raise rates, the market still looks very accommodative. The question is whether following the post-Brexit rally, there is any value left in these stocks; Taylor Wimpey shares are up approximately 50% from their post-Brexit low,” Wilson noted.
In late afternoon trading, Taylor Wimpey shares were down 4.1% at 185.85p.
-- Updates share price --