MENU

Half-Year Profits Up 85% At Taylor Wimpey Plc

Taylor Wimpey (LSE: TW), the homebuilding developer with operations in the UK and Spain, today released results for the six months to 30 June 2013 showing revenues increasing 11% to £1.0bn, operating profits up 34% to £132m and profits from continuing operations before exceptional items jumping 85% to £87m.  Without the benefit of the 2012 tax credit and financing rebate of £82m, overall profits amounted to £136m — a gain of 5%.

Revenues rose following a 2% increase in completions coupled with an average selling price up 7% to £188k.  The operating margin was up 230 basis points to 14%, compared with 11% in 2012.  Taylor Wimpey has an order book of 7,378 homes (as at 28 July 2013) valued at £1.3bn, and are nearly 90% sold for 2013.  Full-year results are now expected to be at the upper end of expectations.

The reduction of net debt from £135m to £68m is also encouraging, as is the board’s decision to increase the interim dividend by 16% to 22 pence per share.

Pete Redfern, chief executive, commented:

“During the first half of 2013, there has been meaningful improvement in the housing market, with more positive consumer sentiment, a more available and affordable mortgage market, and the presence of Government mortgage schemes, all adding to a favourable outlook. Our business is ideally positioned to perform well in this environment with a strong land position and a very effective housebuilding operation. We continue to open all new outlets with implementable planning permission.”

Taylor Wimpey is confident on the outlook for the next few years.  There is a high level of demand for new homes, which the house builder will hope can convert into continued strong sales figures.  The implementation of a new IT system will also help to alleviate glitches in the buying process and lead to cost savings.  Overall, the prospects for growth at Taylor Wimpey are considerable.

Indeed, Taylor Wimpey has been a growth success story with an 144% gain in the last 12 months. If you are interested in tapping into similar opportunities take a look at this free report which could help you on your way.

The report explains how taking a contrarian view and backing unloved companies can be vital steps on the path to the magic £1,000,0000 milestone. Maybe one day, a resurgent Taylor Wimpey could be the share that transforms your wealth.

Just click here to download the report today. But hurry, all Fool reports are free for a limited time only.

> Barry does not own shares in Taylor Wimpey.