Big housebuilders begin reporting first-quarter updates in the coming week.
It’s their first numbers since the industry committed to remove cladding and remediate fire safety issues in buildings over 11 metres in height built over the past thirty years.
Taylor Wimpey PLC (LSE:TW.) updates Tuesday with Persimmon PLC (LSE:PSN) Wednesday and both signed the pledge proposed by housing secretary Michael Gove.
Cost inflation will also be a big theme, with Taylor Wimpey having said this was running at around 6%, back at the time of its final results early last month.
Chief executive Pete Redfern, who has held the CEO role since 2007 and before that at George Wimpey before the merger with Taylor Woodrow was agreed, will be handing in his hard hat and boardroom role to the group’s first female CEO, Jennie Daly, at Tuesday’s annual shareholder meeting.
Daly’s immediate targets are to keep the company on its growth targets for 2022 of low-single-digit growth for new house completions and keeping operating margins on their 21-22% target in the face of the cost inflation.
Persimmon, the FTSE 100’s largest builder, said it anticipated increased selling prices would offset build cost inflation running around 5.0%.
Earlier this month it said that the £75mln it had earmarked for cladding and fire safety rectification works should remain sufficient.
Before that, we last saw numbers from the company at the time of its final results in early March, when chief executive Dean Finch said trading in the new financial year “has started well”.
Private sales rates were said to be ahead by around 2% in the opening weeks, with a “robust” forward sales position of £2.21bn and a target of 4-7% volume growth, “whilst maintaining our industry-leading margins,” which rose to 28.0% last year.