By Taylor Wimpey’s full year revenues rose 3.2% to £4.4bn.
This was driven by higher average selling prices which rose 4% to £313,000.
Operating profits increased from £828.6m to £923.4m, a record figure for Taylor Wimpey.
This was helped by tighter cost controls and a reduced spend on new land as the group reacted to lower sales rates in the second half of the year.
Total group completions fell slightly, down from 14,302 to 14,154 this year. The order book fell from £2.6bn to £1.9bn, excluding joint ventures.
Net cash increased 3.2% to £863.8m due to lower land spending.
Free cash flow also rose from £429.4m to £477.3m.
While sales rates rose to 0.62 in the first 8 weeks of 2023, this is still significantly below the 1.02 seen in early 2022 as affordability concerns continue to mount, especially on the minds of first time buyers.
Full year completions are expected to fall in the range of 9,000 to 10,500.
A final dividend of 4.78p per share has been announced.
This brings the full-year dividend up to 9.4p per share, a 9.6% increase on last year.
The shares were broadly flat following the announcement.
Aarin Chiekrie, equity analyst at Hargreaves Lansdown:
“Taylor Wimpey’s posted strong results in a tough environment for housebuilders.
Higher average house prices helped drive group revenues forward last year, but the picture’s not so pretty for this year.
If current sales rates persist for the rest of 2023, full-year completions are expected to fall by around 30%, which would likely cause a big hit to profits.
And while operating profits rose this year, tighter cost controls can only move the dial so far.
The longer-term fundamentals of the UK housing market remain strong, but short-term headwinds are causing headaches for Taylor Wimpey.
The sector’s facing ongoing labour and supply chain challenges, and sector-wide planning permission disruptions are a thorn in the side.
But housebuilders are cyclical businesses, so it’s important to look at the big picture when downturns like this come round.
Taylor Wimpey’s significant net cash position gives it a cushion to pad out the bumpy road ahead.”
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