Taylor Wimpey plc

Ladies and gentlemen, welcome to the Taylor Wimpy Trading Update. My name is Neil, and I will be coordinating your call today. If you would like to ask a question during the presentation, you may do so by pressing star 1 on your telephone keypad. Now I'll hand you over to Jenny Daly. She's executive from Taylor Wimpy to begin. Jenny, please go ahead.

Thank you, Neil. And good morning, all, and thanks for joining us. I know it's a busy day today. So as usual, I'm joined by Chris, but I'll start with some brief comments before opening up to questions. So I think you'll see from our statement today a consistent message to our comments at half year and you should take away that we're on track and very happy with how we're positioned. If I was to describe the market, I think I'd use words like steady and stable. It's certainly much better than it was at this point last year and it's ticked up from the summer. This has continued in quarter three. albeit we did see an element of consumer caution in the run-up to the recent budget. So in that context, I think we're pleased to have produced a good sales rate of 0.7 for the second half year to date, which is 0.68 excluding bulks, reflecting a relatively low level of bulk activity as we continue to focus on delivering value from our sites. This is testament to our attractive locations and our experienced teams. Our year-to-date cancellation rate remains at normalized levels, so as I say, much improved on last year, though perhaps not back to levels we saw before this downturn. In terms of what we're seeing from customers, generally confidence is good, but we know that there has been a bit of waiting for the budget and potentially for lower interest rates. So with this backdrop, our teams have been working hard to drive sales and educate customers with the help of our IFAs to give them the confidence to commit to their buying decisions. So turning now to outlets, we've operated on an average of 209 outlets in the second half to date and taking into consideration the prevailing sales rates and planned outlet openings, we expect to end the year with just over 200 outlets as we have continued to sell well. Importantly, we continue to have excellent visibility in all of the sites needed to deliver growth from next year, assuming a supportive market, with 95% of our 2025 volumes coming from outlets that will be open by the end of the year. And even though planning does remain challenging, we've had a number of successes recently, so we still expect to open more outlets in 2025 than we did in 2024, but those are likely to be weighted towards the second half. I also know that you'll be very interested in how we are selling into next year. Clearly, there is an improving sales rate, and our current order book is around 2.2 billion, but do bear in mind that this includes year-end completions at this stage. Underlying, we're about 150 private units up on last year, with an affordable slightly lower than last year. But I think, as you know, these sell further out, and so I think we are still well positioned for 2025 affordable deliveries. Overall, with a stronger sales rate, we're in a good position to continue to build the order book to support next year. As I mentioned in the summer, there's been a little bit more opportunity in the land market, and this has been helped in recent weeks by vendors acting ahead of potential changes at the recent budget. We have been active and opportunistic in reviewing land deals And as a result, our year-to-date approvals are around 11,000 plus. So we now expect to end the year with net cash of around 500 million, subject, of course, to the timing of land purchases in the remainder of the year. In terms of the new government initiatives, the big planning announcements came earlier in the summer, and these will be supportive of the industry, albeit implementation will take some time. On the budget, it was pleasing to see continuing commitment to growth in housing and some much-needed investment in planning capacity and local authorities. Whilst funding has increased in the affordable housing sector, and that's to be welcomed, we still haven't seen any meaningful action in respect of the Section 106 affordable housing issues we mentioned at the half-year results. For the business overall, I think it's early yet to assess the impact of the budget on bill cost inflation more broadly. But we are very mindful of the potential impacts of higher national insurance, particularly as regards our subcontractors. So back then to the outlook for 2024, you will see that we reiterated our expectations to deliver full year volumes towards the upper end of our guidance range of 9,500 to 10,000 UK homes, excluding JVs, and to deliver group operating profit in line with current market expectations. Looking ahead, we will continue to monitor the economic environment, but we remain encouraged by the improving customer demand and affordability. And though we will hear more later today, expected rate cuts during 2025 will hopefully provide a tailwind to release some pent-up demand. So we've talked to you previously about how we are set up to run throughout the cycle, and that this gives us the agility to optimise performance in all market conditions. This year has been very much about preparing for the next phase and ensuring all of our teams and operations are ready to take advantage of a better market when it arrives. So while there remain market uncertainties, there is an improved outlook and we remain on track to grow from 2025, assuming supportive market and have strong visibility on the land in place to deliver that growth. And with that, I'll now open up for questions.

Thank you very much. Ladies and gentlemen, if you would like to ask a question, please press star followed by one on your telephone keypad now. If you change your mind, please press star followed by two to withdraw your question. When preparing to ask your question, please ensure your phone is unmuted locally. We will now take our first question from Ainsley Lemon from Infested. Please go ahead.