Taylor Wimpey share price: Housebuilder updates on recent performance

Taylor Wimpey (LON:TW) has updated investors on its half-year performance this morning, noting that it is still too early to assess the impact of the outcome of last month’s EU referendum.

**Highlights from the group’s statement:**
Pete Redfern, Chief Executive, commented:
“We have delivered a strong operational and financial performance with continued growth in profitability, building over 6,000 new homes across the country during the first half of 2016.
One month on from the EU Referendum, current trading remains in line with normal seasonal patterns. Customer interest continues to be high, with a good level of visitors both to our developments and to our website. We are monitoring customer confidence closely across a number of metrics, including appointment bookings, and these continue to be solid. Whilst it is still too early to assess what the longer term impact from the Referendum result on the housing market may be, we are encouraged by the first month’s trading and by continued competitive lending from the mortgage providers as well as the positive commentary from Government and policymakers.

With a strong order book which has grown to over £2.2 billion as at 24 July, we are c.90% forward sold for 2016. We remain fully committed to the Dividend Policy we announced earlier this year which will deliver increased returns to shareholders.”
Current trading and outlook
Whilst it is still too early to assess what long term impact the EU Referendum result will have on the UK housing market, there has been no meaningful change to date, with trading in the last month at a normal seasonal range with a net private sales rate of 0.65. The net private sales rate for the year to date (w/e 24 July 2016) is 0.77 (2015 equivalent period: 0.78).
Since 24 June, the early forward confidence indicators amongst homebuyers, together with the continued competitive lending by mortgage providers, have been encouraging and support confidence in the resilience of the UK housing market. We are monitoring both our own internal measures of customer confidence and external data closely. Help to Buy has continued to be a differentiator for new build housing, and remains popular with our customers. Over the last month, the actions and commentary by the Government, Bank of England and mortgage lenders demonstrate a commitment to housing supply and a recognition that there remains a fundamental imbalance between demand and supply in the UK.
Customer interest remains high, with website visits solid and customers continuing to register interest in forthcoming developments and to make appointments to progress their home purchases. Whilst we saw a small increase in the average cancellation rate immediately following the Referendum, this remained low compared to long term historic norms and is now back in line with recent low levels.
The markets in all of our core regional geographies, which are the primary drivers of our business, continue to trade positively. Whilst the wider London market remains robust and in line with the rest of the UK, the central London market has continued to slow, particularly at the upper end of the market.
As at 24 July 2016, we were c.90% forward sold for private completions for 2016, with a total order book value of £2,237 million (2015 equivalent period: £2,005 million), excluding joint ventures.
A fundamental part of our strategy is a proactive and flexible approach to managing through the housing cycle, with a focus on creating long term value and mitigating future risk. We believe that through all market conditions, quality of location is a key determinant of a home purchase. We are currently operating from 286 high-quality outlets, in locations in villages, towns and cities where people want to live, supported by strong demographics and local economies. This approach, together with a strong balance sheet and a strong strategic land position, optimally positions us for the future to perform well through all market conditions. We remain fully committed to the Dividend Policy which we set out in May 2016 and our objective to provide a consistent and reliable income stream for investors.
As of 07:22 BST, Wednesday, 27 July, Taylor Wimpey plc share price is 144.90p.