Taylor Wimpey PLC (LON:TW.) is to start a staged re-opening of its construction sites from early next month using new social distancing protocols, the housebuilder has said.
Teams will return in the week starting May 4 to prepare sites for a new method of operating with the first subcontractors returning in the week commencing May 11.
Taylor Wimpey shut all of its UK sites on March 24 but said it has devised new working practices that include additional precautionary and risk management measures compliant with government coronavirus guidance such as a range of bespoke protective equipment (PPE) for two-person tasks.
Sales have been affected by the site closures, it said, and completions in the 16 weeks to 19 April dropped by 14% to 2,271 though its order book had risen 12% to £2.68bn compared to a year ago.
“Since closing our sites and sales offices, cancellations have represented only 0.8% of the total order book and new sales have exceeded the number of cancellations,“ the builder said.
Taylor Wimpey had already announced it would scrap its planned final and special dividends and added it had a gross cash position of £836mln as of yesterday.
Pete Redfern, chief executive, said: “We took an early decision at the end of March to close our sites while we assessed in detail how to build homes without compromising on health and safety or quality.
“We are now confident that we have clear plans and processes in place so we can safely start back on site in a phased way beginning on 4 May.
“In the period while our sites have been closed, trading has inevitably been impacted. However, we are still seeing continued demand for our homes and our sales teams have been selling homes remotely, and digitally, week to week.”
Brokers careful on prospects
Peel Hunt, which has an add rating and 230p share price target, said the group has continued to sell homes during the lockdown and the sales prices are comparable to those achieved in the first quarter with no bulk sales.
William Ryder, an analyst at Hargreaves Lansdown, added: "To be clear, we don’t think everything is hunky-dory for Taylor Wimpey or the wider sector.
"The risk of a prolonged recession, falling house prices and sales volumes is still heightened – and we know how quickly that combination can demolish profits for housebuilders.
"However, while the group’s not out of the woods yet, this is better news than we had feared, and we hope the sector’s positive momentum is continued by Persimmon next week.”
Liberum said it was waiting for moe evidence of better times: “In spite of this positive update, we remain cautious on Taylor Wimpey, as we still need to see further evidence that the new strategy is delivering benefits and the margin can progress.”
Shares rose 10% to 148.8p.
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