REG - Taylor Wimpey PLC - TAYLOR WIMPEY PLC FULL YEAR RESULTS
27/02/2025 07:15
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RNS Number : 6249Y Taylor Wimpey PLC 27 February 2025
27 February 2025
Taylor Wimpey plc
Full year results for the year ended 31 December 2024
Well positioned for sustained growth
Jennie Daly, Chief Executive, commented:
"I'm pleased with our performance in 2024, delivering a strong sales rate and
in line results while achieving the highest customer service scores and
overall build quality that we have ever had at Taylor Wimpey. This is
testament to the hard work and commitment of our teams across the Group.
The start of the Spring selling season has been robust, and we have seen good
levels of demand for our homes. Affordability - while remaining a challenge
for many, especially first time buyers - is also moving in the right
direction. As a result, our total order book is up on last year, putting us in
a strong position to grow housing volumes this year. We expect to deliver full
year 2025 UK completions in the range of 10,400 to 10,800 excl. JVs and for
Group performance to be in line with market expectations(1).
We welcome the Government's recent planning reforms which are capable of
delivering a real step change in planning outcomes. We look forward to seeing
increased resources and a focus on the implementation phase to drive these
outcomes and deliver much-needed new homes across the UK."
Operational highlights:
· Group completions (including JVs) of 10,593 (2023: 10,848)
· UK net private sales rate of 0.75 homes per outlet per week (2023:
0.62). Excluding bulk deals, the net private sales rate was 0.67 (2023: 0.54)
· UK average selling price on private completions of £356k (2023:
£370k) with the overall average selling price £319k (2023: £324k)
· Operated in the UK from an average of 216 outlets (2023: 238) and
opened 55 outlets in the year (2023: 47), ending the year with a total of 213
outlets (31 December 2023: 237)
· Strong landbank of c.79k plots (31 December 2023: c.80k plots) and a
c.4k plots year on year increase in the short term owned landbank to c.66k
plots
· Year end net cash(‡) position of £565 million (31 December 2023:
£678 million net cash), ahead of our guidance as a result of the timing of
land purchases
· Final ordinary dividend of 4.66 pence per share, subject to
shareholder approval at the AGM, total dividend for the year of 9.46 pence per
share (2023: 9.58 pence per share), consistent with our Ordinary Dividend
Policy to return 7.5% of net assets per annum
(1)As published on 24 February 2025, the Company compiled consensus
expectation for full year 2025 Group operating profit* is £444 million.
Responsible business and a leader in sustainability:
· Rated five-star for customer service in the Home Builders Federation
(HBF) survey with Taylor Wimpey's highest ever customer service score of 96%
(2023: 92%)
· Improved Construction Quality Review (CQR) score of 4.93 (2023: 4.89)
· Annual Injury Incidence Rate (AIIR)(†***) per 100,000 employees and
contractors of 212 (2023: 151)
· Overall employee engagement score of 93% (2023: 93%), with a 73%
response rate (2023: 69%)
· Contributed £345 million to local communities across the UK (2023:
£405 million)
· Reduced absolute operational carbon emissions by 47% from a 2019
baseline (2023: 35%)
· Added a net £68.9 million to the Group's cladding fire safety
provision in the year and making good progress on remediation of identified
buildings
· Recognition of ESG progress: included in the Dow Jones Sustainability
Europe Index and S&P Sustainability Yearbook 2025, The Financial Times
Europe's Climate Leaders list, rated A- by CDP Climate Change and recognised
in Sustainalytics 2025 ESG top rated companies, with an ESG Risk Rating of Low
· In 2024, again achieved certification to the Carbon Trust's Route to
Net Zero Standard, Advancing level, the only housebuilder to hold this
standard during the year
· Selected four ESG metrics (across Health and Safety, Diversity and
Inclusion, and timber frame completions) for independent limited assurance
procedures by PwC
· Recognised in the NHBC Pride in the Job Awards, with 62 Quality
Awards (2023: 51), 16 Seal of Excellence Awards (2023: 13), two Regional
Awards and the Supreme Award in the Large Builder category
Group financial highlights:
2024 2023 Change
Revenue £m 3,401.2 3,514.5 (3.2)%
Operating profit* £m 416.2 470.2 (11.5)%
Operating profit margin(*†) % 12.2% 13.4% (1.2)ppt
Profit before tax £m 320.3 473.8 (32.4)%
Profit before tax and exceptional items £m 418.5 473.8 (11.7)%
Profit for the year £m 219.6 349.0 (37.1)%
Basic earnings per share pence 6.2 9.9 (37.4)%
Adjusted basic earnings per share pence(††) 8.4 9.9 (15.2)%
Ordinary dividend per share pence 9.46 9.58 (1.3)%
Tangible net assets value per share pence(†) 123.8 127.1 (2.6)%
Net cash £m 564.8 677.9 (16.7)%
N.B. Definitions can be found at the end of the Group financial review
Current trading and outlook
The start of the Spring selling season has been robust and we have seen good
levels of demand for our homes.
Appointments and overall customer interest in our homes remain at healthy
levels, supported by our quality product, site locations and focused sales and
marketing efforts. There is good mortgage availability at competitive rates as
lenders remain committed to the mortgage market. As a result, the encouraging
sales performance seen towards the end of 2024 has continued in the year to
date.
The year to date net private sales rate (w/e 23 February 2025) is 0.75 per
outlet per week (2024 equivalent period: 0.67), up 12% year on year. We have
seen some incremental improvement in market pricing since the start of the
year with current pricing flat year on year. The cancellation rate is 16%
(2024 equivalent period: 12%) and the number of down valuations remain low.
As at 23 February 2025, our total order book excluding joint ventures was
£2,255 million (2024 equivalent period: £1,949 million), comprising 8,021
homes (2024 equivalent period: 7,402 homes).
We have a strong landbank, and an excellent strategic pipeline with over
c.26.5k plots for first principle planning determination in the planning
system as at 31 December 2024, (2023: c.30.2k plots). We were more active in
the land market than expected in 2024, approving c.12k plots (2023: c.3k
plots) which, as previously reported, partly reflects an increase in
attractive opportunities brought forward in the run up to the Budget. We will
remain active and opportunistic in our approach to land acquisition in 2025.
As previously stated, we have begun to see modest build cost inflation and we
expect this to be low single digit for the year, depending on the response
from our subcontractors to rising employer costs. We will continue to work
with our supply chain to identify opportunities for savings across the
business.
While appetite for Section 106 affordable housing continues to be impacted by
headwinds faced by Housing Associations, we have good visibility on this
year's affordable deliveries.
Overall, given the strong order book and confidence in delivery of our plans,
we expect 2025 performance to be in line with market expectations(1). This
reflects 2025 UK completions excluding JVs in the range of 10,400 to 10,800,
with approximately 45% occurring in the first half of the year. Margin in the
first half will reflect weighting of completions over the year, the impact of
underlying pricing in the order book at the start of the year (which was
c.0.5% lower year on year), and build cost inflation.
Looking ahead, we operate in an attractive market, with significant underlying
demand for the quality homes we build. We have a clear strategy focused on
driving value and operational excellence while investing in the long term
success and sustainability of the business. We have a strong balance sheet,
excellent landbank and experienced teams, and are well positioned to deliver
sustained growth.
-Ends-
A presentation to analysts will be hosted by Chief Executive Jennie Daly and
Group Finance Director Chris Carney, at 9am on Thursday 27 February 2025. This
presentation will be webcast live on our website:
www.taylorwimpey.co.uk/corporate (http://www.taylorwimpey.co.uk/corporate)
An on-demand version of the webcast will be available on our website in the
afternoon of 27 February 2025.
For further information please contact:
Taylor Wimpey plc
Tel: +44 (0) 1494 885656
Jennie Daly, Chief Executive
Chris Carney, Group Finance Director
Debbie Archibald, Investor Relations
Andrew McGeary, Investor Relations
FGS Global
TaylorWimpey@fgsglobal.com
Faeth Birch
Anjali Unnikrishnan
Notes to editors:
Taylor Wimpey plc is a customer-focused homebuilder operating at a local level
from 22 regional businesses across the UK. We also have operations in Spain.
Our purpose is to build great homes and create thriving communities.
For further information please visit the Group's website:
www.taylorwimpey.co.uk/corporate (https://www.taylorwimpey.co.uk/corporate)
Follow our company page on LinkedIn, Taylor Wimpey plc
2024 overview
During the year, we maintained strong operational focus and delivered a good
financial performance against a mixed backdrop. Total Group completions
including joint ventures (JVs) were 10,593 (2023: 10,848). UK home completions
excluding JVs were 9,972 (2023: 10,356). We provided 2,178 affordable homes
excluding JVs (2023: 2,351) equating to 22% of total UK completions (2023:
23%). UK average selling price on private completions was £356k (2023:
£370k) with the overall average selling price £319k (2023: £324k).
Group operating profit of £416.2 million, was in line with our guidance, with
an operating profit margin of 12.2% (2023: 13.4%), reflecting the build cost
and pricing dynamics as well as impact of overhead costs being recovered
across fewer completions.
Exceptional costs in the year, before tax, totalled £98.2 million consisting
of the net cladding fire safety provision increase in the year (£68.9
million), loss on disposal of the Winstanley and York Road joint venture
(£13.6 million) and the impact of our share of the cladding fire safety
provision recognised in the Greenwich Millennium Village joint venture (£15.7
million).
Profit for the year was £219.6 million (2023: £349.0 million). We continued
to be highly cash generative with a year end net cash position of £564.8
million (31 December 2023: £677.9 million), ahead of our guidance as a result
of the timing of land purchases.
In the UK, we opened 55 outlets in the year (2023: 47). We traded from an
average of 216 outlets in 2024 (2023: 238) and ended the year with a total of
213 outlets (31 December 2023: 237), slightly ahead of expectations due to a
small number of delayed outlet closings.
We also prepared our business for growth in 2025 and beyond, with a continued
focus on progressing our existing landbank while taking advantage of increased
opportunities in the land market in 2024. We worked to ensure our regional
businesses are equipped to grow, using technology to enhance our operating
efficiency and with targeted investment to increase our responsiveness to
market opportunity. For example, scaling up our timber frame business and
upgrading our warehouse management system at Taylor Wimpey Logistics, to
ensure we are fit for the future.
Our purpose and contribution to the UK economy
Our purpose is to build great homes and create thriving communities. This is a
shared purpose across our business and value chain. It is not only vital for
our customers but also has far reaching positive societal impacts of which we
are extremely proud.
The new build housing sector makes a substantial contribution to both the
communities in which we operate and the UK economy as a whole. We build much
needed homes and infrastructure, create new communities and enhance existing
communities, and strive to make a significant social and economic contribution
to local economies across the UK.
The Home Builders Federation (HBF) estimates that the housebuilding industry
contributes around £53 billion per year in economic activity and provides
around 270k direct jobs in England and Wales, with many more employed
indirectly in various roles across our supply chain.
It is not always well understood the very real benefit that housebuilding can
bring to a local area. Our new housing developments drive economic growth and
positively benefit local communities.
In 2024, Taylor Wimpey contributed £345 million to local communities across
the UK via planning obligations (2023: £405 million). This funded affordable
housing, green spaces, community facilities, commercial and leisure
facilities, transport infrastructure, heritage buildings and public art, and
helped to deliver on our purpose.
The homes we build are significantly more carbon efficient than the vast
majority of existing housing stock and the new build sector is at the
forefront of the UK's efforts to deliver zero carbon ready homes.
Performance and positioning
2024 saw the return of some stability to the UK's new homes market. However,
the year was not without its challenges. At the start of 2024, an improved
interest rate outlook meant lower mortgage rates for our customers with
affordability improving. The summer brought positive changes to the planning
system from the new Government, aimed at getting Britain building, but some
caution on UK finances ahead of the Autumn Budget. After the Budget, forecasts
for future inflation rose slightly and mortgage rates began to rise, albeit
modestly.
Against that backdrop we are pleased with our sales performance which remained
resilient throughout 2024. Our net private sales rate for the year of 0.75
(2023: 0.62) reflects the hard work of our teams and the high-quality of our
locations.
Affordability remained challenging for many potential customers, particularly
first time buyers, in particular in the South of England. Incentives remained
an important element in driving customer commitment throughout 2024 and
overall pricing in the year end order book was marginally lower than the prior
year. We continued to optimise the balance between pricing and volume with a
focus both on margin and return on capital. However, as stated, 2024 margin
continued to be impacted by build cost and pricing dynamics as well as the
impact of overhead costs being recovered across fewer completions.
Our regional businesses continue to work hard to embed the efficiency savings
we have made over the past few years. Build costs on new tenders were stable
over the course of the year. We expect the 2025 cost environment to return to
a more normal profile of low single digit cost increases, given the extended
period without price increases for our suppliers and well known inflationary
pressures for businesses as a result of the Autumn Budget changes to National
Insurance and Minimum Wage.
During the year we focused on setting up our business for growth in 2025 and
beyond. We entered this year with a strong order book and an excellent
landbank. We currently have outlets open that are expected to deliver all of
this year's legal completions and have prepared our highly engaged and
experienced teams for the next phase in the cycle, to deliver growth in 2025
and beyond.
Proven strategy and fit for the future
Our strategy remains consistent and is centred on four strategic cornerstones:
land, operational excellence, sustainability and capital allocation to build a
stronger and more resilient business. These strategic cornerstones guide our
principles of working while allowing us to be agile to respond to
opportunities and risks in changing market conditions.
We manage the business through the cycle which means that while short term
performance is important, strategic decisions also protect the longer term
interests of the Group and its stakeholders. Our approach has enabled us to
optimise value for our stakeholders and, through our differentiated Ordinary
Dividend Policy, to provide a reliable income stream for our investors through
this cycle.
While short term market conditions remain uncertain, the long term
fundamentals remain very strong with an increasingly marked undersupply of
housing estimated at over four million homes, that is particularly acute in
some areas of the country.
Being fit for the future includes making sure we have the strategy and
structures in place across all areas of our business to build the capacity to
support our ambition for growth, focusing on areas we can control.
The changes to the National Planning Policy Framework (NPPF) introduced by the
Government, will require local authorities to identify land to meet the
housing needs of their area for a five year period. Required housing need is
now based on a stock-based approach (a proportion of existing housing in each
region), which has removed ambiguity and increased the national total annual
approvals required to 370k plots per year. If a local authority is unable to
provide evidence that it has a five year housing land supply, there will be
presumption in favour of sustainable development.
We are optimistic that these changes to the planning system should help unlock
the land needed to support homebuilding in coming years, placing the land
market on a similar footing to that of 2012 to 2019 when land conditions were
supportive of industry growth. For our part, we are focusing on the proactive
submission of high-quality applications to planning authorities to best
position Taylor Wimpey to benefit from improvements to the planning process.
As at 31 December 2024 we had c.26.5k such applications for first principle
planning determination in the planning system (2023: c.30.2k), with a
significant number to follow. This will translate into more outlets which will
provide future opportunities to grow volumes.
In 2024, we continued to focus on embedding the operational efficiencies and
savings we have delivered over the last few years and this remains an ongoing
focus. However, we also put in place many of the building blocks to prepare
for the next phase of the market and enable us to grow our volumes, with
market demand, including investing in aspects key to the long term
sustainability of the business, to ensure we are fit for the future.
For example, in 2024, we delivered cost savings through our measured value
improvement programme. We identified savings in certain product types and by
omitting products from certain supplier contracts to source more efficiently
elsewhere. We continued to drive standardisation through Taylor Wimpey
Logistics (TWL) and by driving greater conformity to our standard house types,
which comprised 94% of our 2024 home completions excluding apartments (2023:
90%).
TWL is a key differentiator and remains integral to our drive for increased
efficiency and standardisation. TWL holds strategic stock and then provides
build packs that can be called off on a 'just in time' basis for site. This
improves control, consistency of supply and also provides a buffer for our
regional businesses, which received orders 98% on time in full from TWL in
2024. This enhances the efficiency of our operations as well as visibility for
our site teams and subcontractors. In 2024, we installed a new warehouse
management system to future proof our facility and further increase efficiency
and quality.
During 2024, we delivered the first kits as planned from our ISO 9001
accredited timber frame manufacturing factory. This has been a strategic
component of the ability of our businesses to scale up and to also increase
sustainability. We continue to scale up timber frame production and our
regional businesses are actively looking for opportunities suitable for timber
frame. In combination with our existing suppliers, our own facility will help
us in our goal to increase timber frame usage to 30% of our completions by
2030. In 2024, 1,624 of our completions were timber frame (2023: 1,661).
We continue to support the UK's transition to net zero through delivery of
energy-efficient, low carbon homes and delivery of our Net Zero Transition
Plan. As we move forward, we are ensuring that commitment to the UK's
biodiversity and nature is still prioritised as changes to the planning system
are rolled out. In 2024, we again achieved certification to the Carbon Trust's
Route to Net Zero Standard, Advancing level, the only housebuilder to hold
this standard during the year.
For a number of years Carbon Trust have provided limited assurance over our
carbon and energy data; this year we have gone further by selecting four
additional ESG metrics (across Health and Safety, Diversity and Inclusion and
timber frame completions) that have been subjected to independent limited
assurance procedures by PwC, demonstrating our commitment to ESG.
It matters to us how we achieve our results. We are a leader in build quality
in the volume industry and have again improved our CQR score. This is a key
performance indicator (KPI), reflecting our commitment to delivering
high-quality homes for our customers.
Further KPIs relate to our customer service and we are particularly pleased to
have increased our 8-week customer service score to 96% (2023: 92%) our
highest ever performance, and our 9-month customer service score to 80% (2023:
77%). This is the result of targeted work over the past few years and the
efforts of our excellent teams to improve our processes. We have improved
management information systems with our Customer Relationship Management (CRM)
system and enhanced the customer journey by raising standards, increasing
customer contact points and the speed of our response. Continuous improvement
in our customer offer is one of the ways we will continue to drive and capture
opportunities in all market conditions.
The industry is facing a significant skills shortage. We are pleased to have
highly skilled and engaged employees and in 2024, we launched a compelling
employee value proposition, to ensure we will continue to attract and retain
the best people, a key component of our preparedness for the future.
We are developing our IT capabilities via our Innovate(TW) programme with a
focus on improving our processes, increasing business-led innovation, and
using technology to share best practice quickly across the Group. Our team are
working to identify actionable ideas from over 260 received from employees so
far. We have also employed artificial intelligence (AI) to simplify tasks and
free up employee time for more value added activities, such as supporting our
customers, monitoring build programmes and ensuring build quality, and closely
scrutinising costs.
New workstreams are designed to enable us to optimise our operations in a
sustainable way. Continuous business improvement remains key to protecting
stakeholder value against a backdrop of increasing regulatory and economic
demands. This includes increased standardisation and use of modern methods of
construction such as timber frame.
2025 priorities
Over the past year we have set up the business for growth, with a strong
financial position and order book, and an excellent landbank, meaning we are
well placed for 2025. This year we want to embrace those opportunities for
growth and further drive performance.
There are aspects that we consider as fundamental to Taylor Wimpey and as such
these are considered 'business as usual' including, health, safety and
environmental protection, high-quality build, an excellent customer service
journey for all customers and partners and a keen focus on cost. Over and
above the fundamentals we have a number of specific focus areas for 2025:
· Continue to improve build efficiency and compliance: protecting the
value we create means enhancing efficiency and extracting economies of scale
to deliver best practice across the Group. Build compliance and standard
processes are key to ensure we continue to drive performance and optimise
efficiencies.
· Deliver sales performance and optimise price: our teams are
incentivised to drive value as we continue to optimise the balance between
sales rate and price.
· Drive outlet openings: business wide focus on delivering new quality
outlets efficiently to support execution of the growth opportunity, with asset
turn and return on capital front of mind. We expect to open more outlets in
2025 than in 2024 with outlet openings to be weighted towards the second half
of the year.
· Further digitise our processes to drive efficiencies and future proof
the business: we are developing our IT capabilities via our Innovate(TW)
programme with a focus on digitising our processes to create the platform to
deliver greater business-led innovation, using technology to share best
practice quickly across the Group.
· Employee value proposition: our industry is facing a skills shortage,
and we continue to work hard to attract and retain the best people. Our
revamped employee value offer outlines the benefits of working for Taylor
Wimpey, including development and training for all our employees and
additional enhancements to our family policies, including improvements to
maternity, adoption, paternity, and the introduction of paid carers leave.
· Deliver against our environmental targets and commitments in our
Environment Strategy and Net Zero Transition Plan: environmental performance
is growing in importance and, like health and safety, is a key priority for
Taylor Wimpey. Increasingly we need to extend our environmental performance
data to ensure we can comply with changing regulation and drive progress on
our sustainability commitments.
Competition and Markets Authority (CMA)
Taylor Wimpey welcomed the CMA's final report, published on 26 February 2024,
from its housebuilding market study with its focus on improving the planning
system, adoption of amenities and outcomes for house buyers.
At that time of publication, the CMA commenced an investigation into a number
of housebuilders, including Taylor Wimpey, relating to concerns that they may
have exchanged competitively sensitive information. On 10 January 2025, the
CMA updated its timetable stating that further investigation, including
additional evidence gathering and CMA analysis and review, would continue
until May 2025.
We will continue to cooperate fully with the CMA in relation to its
investigation as we have done throughout the process to date.
Commitment to sustainability
Environment and net zero by 2045
We published our Net Zero Transition Plan in early 2023, with our goal to be
net zero aligned in our operations by 2035 and to reach net zero carbon
emissions across our value chain by 2045, five years ahead of the UK
Government's target. Our net zero targets have been independently validated by
the Science Based Targets initiative (SBTi). Our Environment Strategy,
Building a Better World, includes ambitious targets up to 2030 across climate,
nature, resources and waste.
As stated, in 2024, we again achieved certification to the Carbon Trust's
Route to Net Zero Standard, Advancing level, the only housebuilder to hold
this standard during the year. A scope 1 and 2 carbon reduction measure was
included in the incentive plans for senior leadership and regional management
in 2024 to support progress on our near term carbon reduction targets. For a
number of years we have received limited assurance over our carbon and energy
data from The Carbon Trust.
We were included in the Dow Jones Sustainability Europe Index and the S&P
Sustainability Yearbook 2025, rated A- by CDP Climate Change and recognised in
Sustainalytics 2025 ESG top rated companies, with an ESG Risk Rating of 'Low'.
We are a member of Next Generation, the sustainability benchmark for UK
housebuilders, and received a silver rating in 2024.
Cladding fire safety
The safety of our customers is of paramount importance, and we have always
been guided by this principle. It is our long held view that leaseholders
should not have to pay for the cost of fire safety remediation and our
priority has always been to ensure that customers in Taylor Wimpey buildings
have a solution to cladding remediation.
We took early and proactive action, committing significant funding and
resources to address fire safety and cladding issues on all affected Taylor
Wimpey apartment buildings built since 1992.
In 2022, we signed up to the Government's Building Safety Pledge for
Developers and the Welsh Government Building Safety Developer Remediation Pact
which reaffirmed our commitment that leaseholders should not have to pay for
fire safety remediation. In the first half of 2023 we also signed the Scottish
Safer Buildings Accord. Prior to signing these, we had already begun working
on affected Taylor Wimpey buildings. By the end of 2022 we had recorded a
total provision for cladding fire safety remediation works of £245.0 million.
In the first half of 2024 we reassessed the remediation costs based on tenders
received and based on this updated information and enhanced cost appraisal,
the expected fire safety remediation cost was increased by £88.0 million. The
increase was due to increased costs based on recent tenders, including project
delivery administration costs and funding of the Building Safety Fund
pre-tender costs and a small number of new buildings being added. In the
second half of 2024 one of the Group's joint ventures recognised a provision
for remediation works on the buildings it built and as a result £19.1 million
has been released from the provision held by the Group in relation to those
buildings. This results in a net charge for the year of £68.9 million,
recognised in operating expenses as an exceptional item.
During the year we spent £28.5 million on remediation works and continued to
progress work with building owners, management companies and leaseholders and
we remain committed to resolving these issues as soon as practicable for our
leaseholders. We have 203 buildings within the scope of our provision, all of
which have been assessed by our specialist team. We signed the Ministry of
Housing, Communities and Local Government's Joint Plan in 2024 and are working
to meet the targets it sets out.
Winstanley and York Road joint venture
In December 2024, we disposed of our interest in the Winstanley and York Road
Regeneration LLP joint venture - this was a mutual agreement with Wandsworth
Council enabling the Council to take a new approach to prioritise the delivery
of affordable housing provision. The JV was formed in 2017 to deliver a
12-to-15-year estate regeneration scheme including a mixed-use development of
up to 2,550 homes, improved community facilities and a new park. Under the JV,
139 homes, a new school, church, multi-use games area and play area have been
successfully delivered. The net impact was a £13.6 million loss, recognised
as an exceptional cost in 2024.
Capital allocation framework
Our priority is to maintain a strong balance sheet with low adjusted gearing.
We use cash generated by the business to fund our investment in land and work
in progress to support and drive future growth. Thereafter, our aim is to
provide an attractive and reliable income stream to our shareholders
throughout the cycle, including during a normal downturn, via an ordinary cash
dividend linked to Group net assets.
In line with our Ordinary Dividend Policy to return 7.5% of net assets, or at
least £250 million annually, we have today announced a final ordinary
dividend payment of 4.66 pence per share, which is subject to shareholder
approval at the Annual General Meeting (AGM). With the 2024 interim dividend
payment of 4.80 pence per share, the total ordinary dividend for the year is
9.46 pence per share or approximately £335 million.
Board changes
After just over nine years, Humphrey Singer stepped down from the Board on 31
December 2024. Scilla Grimble, independent Non Executive Director, succeeded
Humphrey as Chair of the Audit Committee with effect from 1 September 2024 and
Lord Jitesh Gadhia, independent Non Executive Director, succeeded Humphrey as
the Senior Independent Director.
Martyn Coffey joined the Board as an independent Non Executive Director on 1
December 2024 and became a member of the Audit and Nomination and Governance
Committees. Having previously served as CEO of Marshalls Plc for over ten
years and as a Non Executive Director of Eurocell plc for eight years, Martyn
brings a wealth of experience and deep knowledge of manufacturing for the
building industry and of supply chains.
Operational review
Our operational review focuses on the UK (unless stated otherwise) as the
majority of metrics are not comparable in our Spanish business. There is a
short summary of the Spanish business in the Group financial review. The
financial review is presented at Group level, which includes Spain, unless
otherwise indicated. Joint ventures are excluded from the operational review
and are separated out in the Group financial review, unless stated otherwise.
Our Key Performance Indicators (KPIs)
Our key performance indicators align to our strategic cornerstones.
UK 2024 2023 Change
Land
Land cost as % of average selling price on approvals 17.0% 15.2% 1.8ppt
Landbank years c.7.8 c.7.7 1.3%
% of completions from strategically sourced land 40% 45% (5)ppt
Operational excellence
Construction Quality Review (average score / 6) 4.93 4.89 0.8%
Average reportable items per inspection 0.18 0.28 (0.10)
Annual Injury Incidence Rate (per 100,000 employees and contractors) 212 151 40.4%
Employee engagement (annual survey) 93% 93% -
Sustainability
Customer satisfaction 8-week score 96% 92% 4ppt
'Would you recommend?'
Customer satisfaction 9-month score 80% 77% 3ppt
'Would you recommend?'
Reduction in operational carbon emissions intensity against our 2019 baseline 21% 5% 16ppt
N.B. The 8-week 'would you recommend' score for 2024 relates to customers who
legally completed between October 2023 and September 2024, with the comparator
relating to the same period 12 months prior. The 9-month 'would you recommend'
score for 2024 relates to customers who legally completed between October 2022
and September 2023, with the comparator relating to the same period 12 months
prior.
2024 sales, completions and pricing
Total Group completions including joint ventures were 10,593 (2023: 10,848).
UK home completions excluding joint ventures were 9,972 (2023: 10,356). We
provided 2,178 affordable homes excluding joint ventures (2023: 2,351)
equating to 22% of total UK completions (2023: 23%). Our UK net private sales
rate for 2024 was 0.75 homes per outlet per week (2023: 0.62). Excluding the
impact of bulk deals, the net private sales rate was 0.67 (2023: 0.54). The
cancellation rate for the full year was 15% (2023: 18%).
UK average selling price on private completions was £356k (2023: £370k) with
the overall average selling price £319k (2023: £324k).
We estimate that market-led house prices have seen c.1% deflation for
completions in 2024 (2023: c.1% inflation).
In the second half of the year, we experienced weaker pricing in the South of
England where affordability has been most stretched, compared to the North
where we have captured some price growth. As a result, underlying pricing in
the year end order book was around 0.5% lower year on year.
Underlying build cost inflation on completions in 2024 was c.1.5% (2023:
c.8.5%).
We ended the year with a strong order book valued at £1,995 million (31
December 2023: £1,772 million), excluding joint ventures, which represents
7,312 homes (31 December 2023: 6,999 homes), of which 3,208 are private (2023:
2,565) and 4,104 are affordable (2023: 4,434).
In the UK, we traded from an average of 216 outlets in 2024 (2023: 238) and
ended the year with a total of 213 outlets (31 December 2023: 237), slightly
ahead of expectations due to a small number of delayed outlet closings.
Land
As at 31 December 2024, our short term landbank stood at c.79k plots (2023:
c.80k plots). The short term owned proportion of our landbank increased by
c.4k plots to c.66k plots. Our strategic land pipeline was c.136k potential
plots (2023: c.142k potential plots). We approved c.12k plots (2023: c.3k
plots) in 2024 which, as previously reported, partly reflects increased
opportunities in the land market in the run up to the Autumn Budget.
The average cost of land as a proportion of average selling price within the
short term owned landbank remains low at 12.9% (2023: 13.7%). This reflected
the impact of strategic land pull through as well as the regional mix of sites
being weighted towards the North.
The average selling price in the short term owned landbank in 2024 increased
by 5.2% to £344k (2023: £327k).
As at 31 December 2024, we were building on, or due to start in the first
quarter of 2025, on 98.4% of sites with implementable planning (2023:
99.6%).
Our success in developing our strong strategic pipeline means that 56% of our
short term landbank has originated from this source (2023: 54%). In the year,
40% of our completions were sourced from the strategic pipeline (2023: 45%).
During 2024, we converted a further c.6k plots from the strategic pipeline to
the short term landbank (2023: c.8k plots).
Customers
We are pleased to have increased our Home Builders Federation (HBF) 8-week
'would you recommend?' score to 96%, the best we have ever recorded (2023:
92%) and retained our five-star rating. We also saw an increase in our 9-month
score which gives us insight into how customers feel about the homes and
places we build over the longer term. Our score is our highest ever at 80%
(2023: 77%) which reflects the work we have been doing to strengthen our
customer service and build quality and to improve the time taken to resolve
customer issues.
We encourage customers to leave reviews on Trustpilot. At the end of 2024,
with 10,107 reviews, we had a 4 out of 5 star rating (end of 2023: 4 out of
5 with 8,950 reviews).
We have prioritised working with all our partners to deliver excellent
customer service and leverage our customer database capabilities and data
insights provided by our fully integrated CRM system to better support our
customers and align our marketing strategy, in order to build a strong order
book. In a changing market, understanding our customers is more important than
ever.
Build quality
We continue to see improvements in our build quality as measured by the NHBC
CQR score, which measures build quality at key build stages. In 2024, we
scored an average of 4.93 (2023: 4.89) from a possible score of six. This
compares with an industry benchmark group average score of 4.70.
We aim to maintain high standards by ensuring our quality assurance processes
are embedded at every stage of the build. We clearly communicate our quality
standards to subcontractors and invest in training, process improvements and
regular inspections throughout the build process to ensure consistently high
standards and prevent quality issues from occurring.
Placemaking
Good placemaking ensures our teams plan, design and deliver schemes that
become successful and sustainable new communities, where our customers can
enjoy a good quality of life.
Placemaking is about creating communities that are socially, environmentally
and economically sustainable. During 2024, we have been developing our
Placemaking Charter, a new framework to further embed strong placemaking
standards across our business. The Charter will be fully rolled out to our
teams in 2025 and is based around five key principles:
- Connected communities
- Places where life happens
- Attractive and welcoming places
- Safe places
- Places designed with nature
Access to transport and local infrastructure and facilities contributes to the
success of our schemes. In 2024, we contributed £345 million to local
communities in which we build across the UK via planning obligations (2023:
£405 million). This funded a range of infrastructure and facilities including
affordable housing, green space, community facilities, commercial and leisure
facilities, transport infrastructure, heritage buildings and public art. We
aim to install infrastructure at an early stage of the build process to
enhance our schemes and help the new community become established quickly. We
also invest in public and community transport, walkways and cycle paths.
Employees
Health and safety
Health and safety remains our number one priority and it is the first topic
covered in every Board, Group Management Team (GMT) and regional management
team meeting across the country. Building sites are inherently dangerous
places and so it is essential that strict safety protocols are identified,
embedded, monitored and enforced and a clear, consistent and disciplined
approach to safety is paramount throughout the organisation. 98% of our
employees agree that we take health and safety seriously (2023: 98%).
Our Annual Injury Incidence Rate (AIIR) for reportable injuries per 100,000
employees and contractors was 212 in 2024 (2023: 151). This reflects an
increase in minor slips, trips and falls. Around 40% of accidents were slips,
trips and falls and this will be an increased area of focus this year.
Despite the increase, we remain below the HBF Home Builder Average AIIR of
246.
Our AIIR for major injuries per 100,000 employees and contractors was 59 in
2024 (2023: 65).
Culture and people
We have a strong culture at Taylor Wimpey which we and our employees are proud
of. This is demonstrated in our latest employee survey with an overall
employee engagement score of 93% (2023: 93%), with a 73% response rate (2023:
69%).
We seek feedback from, and engagement with, all employees. This includes
regular updates and Teams calls from the Chief Executive and a wide variety of
senior management. It is important that management is accessible and visible.
In addition to regular visits to the regional businesses, we operate a
National Employee Forum, National Young Person's Forum and Local Employee
Forums in our regional businesses, where employee representatives are able to
feedback to, and ask questions of, members of the Board and other senior
management directly. We also support six employee resource groups to advance
our Equality, Diversity and Inclusion agenda. During 2024, our voluntary
employee turnover rate reduced to 12.1% (2023: 14.2%).
We are pleased to report that Taylor Wimpey was once again recognised in the
NHBC Pride in the Job Awards, achieving a total of 62 Quality Awards (2023:
51), 16 Seal of Excellence Awards (2023: 13) and two Regional Awards. We are
proud to announce that in January 2025, Site Manager, David McClure, from our
Castle Gate development in West Scotland was honoured with the Supreme Award
in the Large Builder category - the very highest achievement in the Pride in
the Job awards programme.
Skills
During 2024, we directly employed, on average, 4,354 people across the UK
(2023: 4,618) and provided opportunities for, on average, a further c.9.4k
operatives (2023: c.9.3k) on our sites.
We recognise that building the skills of our current and future workforce is
essential to address current and potential future skills gaps in our industry
and subcontractor base. We continue to work closely with our partners, peer
companies, industry associations and educational organisations to identify and
address skills gaps and upskill our workforce and also share best practice
within the industry bodies.
We support our regional businesses to develop local links with colleges,
universities and schools and encourage a diverse range of candidates to
consider careers in housebuilding. Each of our regional businesses has a
schools engagement plan and we engaged with 550 schools and reached 330,000
students in 2024 also offering webinars for parents / guardians.
Our career converters programme supports ex-service personnel to join our
business. In 2024, this included a focus on recruiting former service
personnel to Trainee Assistant Site Manager roles.
Equality, diversity and inclusion (ED&I)
We remain committed to creating a more diverse workforce and will publish our
third Diversity and Inclusion Report in 2025. We have set quantitative targets
to improve gender balance at all levels and to increase ethnic minority
representation. Our targets are aspirational, but we believe that it is
important to be ambitious and hold ourselves to account.
Our aim is to create a workplace where colleagues feel championed and
supported regardless of their background and identity.
Investment in ED&I is a long term commitment for Taylor Wimpey, supported
by our Board, and all levels of our leadership. Alongside our successes, we
remain focused on the areas we still need to progress. Due to market
conditions, we recruited and employed fewer people in 2024, and this impacted
our ability to make progress on our diversity targets.
Our workforce is not yet reflective of the UK's ethnic diversity. As at 31
December 2024, 5.5% of our employees were from a Black, Asian or other
minority ethnic background (2023: 5.7%). Ethnic representation in the GMT and
direct reports was 6.9% (2023: 6.9%) and 2.5% in regional business leadership
roles (2023: 3.7%).
In 2024, our employee base comprised 2,823 males (2023: 2,912) and 1,503
females (2023: 1,524), which equates to a gender mix of 65% male (2023: 66%)
and 35% female (2023: 34%) across the Company. Our GMT was 33% female (2023:
33%). Our Board of Directors was 44% female (2023: 44%), comprising 4 females
(2023: 4) and 5 males (2023: 5). Females in the GMT and direct reports to GMT
was 26% (2023: 28%), comprising 19 females (2023: 20) and 53 males (2023: 52).
Reduced overall recruitment impacted our graduate and trainee recruitment. 33%
of graduates were females (2023: 62%) and 29% were from a minority ethnic
background (2023: 17%). In our other early entry talent programmes the
figures were 14% and 11% (2023: 15% and 7%).
In line with the Gender Pay Gap regulations, we calculated our 2024 gender pay
gap based on pay and bonus data at the 'snapshot date' of 5 April 2024 (paid
over the preceding 12 months). The calculations cover all staff employed by
Taylor Wimpey UK Limited as at 5 April 2024. This data shows that our mean
gender pay gap was 8% in favour of men (2023: 6% in favour of men) and median
pay gap 6% in favour of men (2023: 2% in favour of men).
The shift in our pay gap this year reflects a number of factors, including:
lower levels of sales commission (due to market conditions) which impacts more
female employees (females make up 81% of sales employees (2023: 83%)); larger
than average pay increases for all lower paid employees which impacted more
male employees; and a reduction in the overall number of employees. We will
continue to focus on our programmes to increase female representation across
different functions and levels of the business which will reduce the pay gap
over time. More information is available online in our Diversity and Inclusion
Report.
Charity partnerships
During 2024, we continued our partnership with our national charities as well
as local charity partners across the UK. Our national partners are Youth
Adventure Trust, Every Youth, Crisis, CRASH, Magic Breakfast, and St Mungo's.
In total, during 2024, we donated and fundraised c.£1 million for registered
charities (2023: c.£1 million). This included supporting St Mungo's
Construction Skills Training Centres to help people recovering from
homelessness gain new skills and find employment in the construction industry.
This year we also took part in CRASH's Christmas washbag campaign, where our
employees assembled more than 3,000 bags with essential toiletries, such as
soap, toothbrushes, and toothpaste, for homeless charities and hospices across
the UK. In its tenth year, our annual Taylor Wimpey Challenge reached the £1
million milestone for total funds raised. In 2024, 355 employees took part in
the event and headed to the Jurassic Coast in Dorset, with a total of 56 teams
that raised over £113k for the Youth Adventure Trust, and over £44k to
support other charities. In addition, through our partnership with Magic
Breakfast we contributed £80k to help serve over 285k breakfasts to pupils in
England and Scotland from September 2023 to September 2024.
Sustainability
We recognise the importance of sustainability which is integrated throughout
our business and has been incorporated as one of our four strategic
cornerstones. Our approach encompasses environmental, social, economic and
governance aspects.
Our Environment Strategy, Building a Better World, is our response to the
environmental crisis and the physical and transitional risks posed by climate
change. It sets out how we will play our part in creating a greener, healthier
future for our customers, colleagues and communities, with ambitious targets
up to 2030 focusing on climate change, increasing nature on our developments,
cutting waste and improving resource efficiency.
Environment Strategy performance update
Our strategic objectives Performance update
Climate change Since 2019, our operational emissions intensity has decreased by 21% and
absolute operational emissions have fallen by 47%.
Achieve our science-based carbon reduction target:
- Reduce operational carbon emissions intensity by 36% by 2025 from a 2019
baseline We have reduced scope 3 carbon emissions intensity by 8% compared with 2023
and by 12% against our 2019 baseline. Absolute scope 3 emissions decreased by
- Reduce scope 3 emissions by 52.8% per 100 sqm of completed floor area from a 9% compared with 2023 and by 41% against our baseline.
2019 base year (based on a reduction of 46.2% in absolute emissions against
the base year)
Nature New sites submitting their first planning application now include a minimum
biodiversity net gain (BNG) of at least 10% in line with regulation. We have
Increase natural habitats by 10% on new sites from 2023 and include our published guidance and held training sessions for our regional businesses to
priority wildlife enhancements from 2021. support them to manage the risks, costs and opportunities associated with BNG.
We integrate nature enhancements on all suitable new sites and have started
with hedgehog highways, bee bricks, bug hotels, bird boxes and bat boxes.
Since 2021, we have installed over 5,500 wildlife enhancements such as bee
bricks, bug hotels, bird and bat boxes, to support native species and 326
sites included hedgehog highways.
Resources and waste Our waste intensity has reduced by 14% against our 2019 baseline, and by 22%
compared with 2023. Total waste volumes also decreased year-on-year and
Cut our waste intensity by 15% by 2025 and use more recycled materials. against our baseline. Our Towards Zero Waste Strategy and Action Plan guide
our approach to reducing waste.
N.B. At the time of publication, our waste data was undergoing audit by the
Carbon Trust. We will publish the final audited figures on our website on
completion of this process which could differ from those reported here.
A full summary of our Environmental Strategy and progress against targets will
be published in our Annual Report and Accounts 2024 and Sustainability Summary
and Data document 2024.
Climate change and net zero
Our approach to climate change aims to reduce emissions from our business and
value chain, to manage the business risk, and to prepare for the impacts of
climate change on our business, supply chain and customers. We take a
science-based approach and aim to continually review and improve performance.
Our Net Zero Transition Plan commits us to reduce our climate footprint ahead
of the UK's 2050 target. The two key commitments in our strategy are:
- Net zero aligned in our operations by 2035 (scope 1 and 2)
- Net zero emissions across our value chain by 2045 (scope 1, 2 and 3)
(comprising at least a 90% absolute reduction and neutralising residual
emissions)
Our target was developed with the Carbon Trust in line with the requirements
of the SBTi Corporate Net Zero Standard. Our net zero target for 2045 has been
validated by the SBTi confirming that it is aligned with the SBTi's 1.5°C
mitigation pathways for reaching net zero by 2050 or sooner. This is currently
the most ambitious designation available through the SBTi process. Our near
term targets have also been validated by the SBTi. We have achieved
certification to the Carbon Trust's Route to Net Zero Standard, Advancing
level, and were one of the first organisations to gain this new standard.
Our Net Zero Transition Plan comprises a four-stage roadmap detailing the
actions we will take to achieve our overall commitment and supporting targets,
incorporating both new and existing workstreams such as the construction of
low and zero carbon ready homes, increasing the use of construction materials
with lower embodied carbon including timber frame, transitioning to 100%
renewable electricity, reducing or replacing fossil fuels and decarbonising
our fleet.
In 2024, we reduced absolute operational emissions (scope 1 and 2) by 47%
against our 2019 baseline, with operational emissions intensity falling by 21%
over the same period. This reflects fewer completions in 2024 compared to 2019
as well as the impact of carbon reduction measures such as our sourcing of
renewable electricity and a reduction in the use of diesel due to roll out of
hybrid generators and use of hydrotreated vegetable oil.
A carbon reduction measure is part of the incentive schemes for our senior and
regional leadership to help drive further progress.
We report against the recommendations of the Task Force on Climate-related
Financial Disclosures (TCFD) in our Annual Report and Accounts. We also
publish a Sustainability Summary and Data document with additional data
including the Sustainability Accounting Standards Board (SASB) recommended
disclosures for our sector. For a number of years we have received limited
assurance over our carbon and energy data from The Carbon Trust.
Nature and resource efficiency
Our Environment Strategy targets include biodiversity net gain requirements
and go beyond regulation to deliver priority wildlife enhancements and
wildlife friendly planting. Since 2021, we have installed over 5,500 wildlife
enhancements such as bee bricks, bug hotels, bird boxes and bat boxes to
support native species, and 326 sites included hedgehog highways.
Our Towards Zero Waste Strategy and action plan sets out a three year
programme of action and capacity building in relation to resource use and
waste across all stages of development. We are working with our suppliers to
reduce waste from packaging, increase recycling and identify opportunities to
increase use of sustainable and recycled materials.
Preparing for regulatory changes and opportunities in green building
Over the next five years there will be significant changes to new build homes
in the UK reflecting the UK's climate change targets. Our target is to reduce
emissions from customer homes in use by 75% by 2030, and we are testing a
range of technologies and enhanced fabric standards to achieve this.
Following the phasing in of the new Parts L, F & O of the Building
Regulations in England from June 2022, Parts L & F from November 2022
for Wales and Section 6 in Scotland from February 2023, our homes have
enhanced fabric standards with additional features that include wastewater
heat recovery systems, triple glazing and PV panels. Homes built to this
specification will achieve a 31% reduction in carbon emissions compared with
our previous specification.
We expect an update from the Government following the consultation on Future
Homes Standard (FHS) regulation later in the year. We have been preparing for
this regulation which will see our homes become all electric and zero carbon
ready and successfully completed our first trial of zero carbon ready homes in
2023.
The Building Safety Act in England has introduced enhanced building safety and
compliance measures for the design, construction and management of buildings.
We are well prepared due to our existing procedures and the quality of our
site management teams, which can be evidenced in our high Construction Quality
Review (CQR) scores.
The Building Safety Levy was first announced by the previous Government, which
conducted two consultations (from July 2021 to October 2021 and November 2022
to February 2023). So far the Government has stated that the Levy will be
charged on all new residential buildings in England (subject to exemptions)
which require building control approval, and applications for building control
after the date the regulations come into force will be liable for the levy
charge. The Levy aims to raise around £3.4 billion over at least ten years
and the Government intends that the Levy will come into effect in Autumn 2025.
While we are awaiting further detail and the implementation date, we are
proactively mitigating and managing risk, in so far as is possible, in our
landbank and strategic pipeline and in our approach to ongoing and future land
buying.
Group financial review
Income statement
Group revenue was £3,401.2 million in 2024 (2023: £3,514.5 million), with
Group completions, excluding joint ventures, being 2.7% lower at 10,476 (2023:
10,766). The UK average selling price on private completions decreased by 3.8%
to £356k (2023: £370k), due to both underlying price deflation and mix.
Partially offsetting this, the UK average selling price on affordable housing
increased to £186k (2023: £168k), with a slightly lower proportion of
affordable housing in 2024 (22%) than the prior year (2023: 23%). This
resulted in the total UK average selling price being 1.5% lower at £319k
(2023: £324k).
Group gross profit decreased to £648.7 million (2023: £716.5 million), with
build cost inflation and house price deflation partially offset by a higher
profit generated from land sales in the period, resulting in a gross margin of
19.1% (2023: 20.4%).
Net operating expenses were £314.8 million (2023: £248.7 million), which
includes £68.9 million of exceptional costs relating to the cladding fire
safety provision as described in the previous section and £13.6 million loss
on disposal of the Winstanley and York Road joint venture, arising from the
difference between proceeds on disposal and the Group's net investment in the
joint venture, with no such amounts in the prior year.
Excluding exceptional costs, the net operating expenses were £232.3 million
(2023: £248.7 million), which was predominantly made up of administrative
costs of £242.0 million (2023: £232.7 million) that increased due to cost
inflation and investment in our timber frame facility and IT infrastructure.
This resulted in a profit on ordinary activities before financing of £333.9
million (2023: £467.8 million), £416.4 million (2023: £467.8 million)
excluding exceptional items.
Completions from joint ventures in the year were 117 (2023: 82). The Group's
share of joint ventures' results in the year, excluding exceptional items, was
a £0.2 million loss (2023: £2.4 million profit). The loss arose from
operating costs of the Winstanley and York Road joint venture now disposed of
and on joint ventures that are between phases of developments. One of the
Group's joint ventures has recognised an exceptional expense for building
remediation works on buildings it constructed. The Group had previously
provided for its share of the costs in its central provision held for cladding
fire safety, which has been released in the year as noted above. Including
exceptional items the Group's share of joint ventures' results, after tax, was
a £15.9 million loss (2023: £2.4 million profit).
When including the share of joint ventures' results in the profit on ordinary
activities before financing and exceptional items, the resulting operating
profit was £416.2 million (2023: £470.2 million), delivering an operating
profit margin of 12.2% (2023: 13.4%). The total order book value of joint
ventures as at 31 December 2024 increased to £28 million (31 December 2023:
£6 million), representing 104 homes (31 December 2023: nine).
The net finance income of £2.3 million (2023: £3.6 million) reflects that
interest earned on deposits continued to more than offset the imputed interest
on land acquired on deferred terms, bank interest and interest on the pension
scheme.
Profit on ordinary activities before tax decreased to £320.3 million (2023:
£473.8 million). The total tax charge for the period was £100.7 million
(2023: £124.8 million), a rate of 31.4% (2023: 26.3%); the current year
includes a credit of £20.2 million in respect of the exceptional charge
recognised. The pre-exceptional tax charge was £120.9 million (2023: £124.8
million), representing an underlying tax rate of 28.9% (2023: 26.3%).
As a result, profit for the year was £219.6 million (2023: £349.0 million).
Basic earnings per share was 6.2 pence (2023: 9.9 pence). The adjusted basic
earnings per share was 8.4 pence (2023: 9.9 pence).
Spain
Our Spanish business primarily sells second homes to European and other
international customers, with a small proportion of sales being primary homes
for Spanish occupiers. The business completed 504 homes (2023: 410) with the
average selling price increasing to €440k (2023: €400k), due to regional
mix, and to a lesser extent mix of house types sold. The total order book as
at 31 December 2024 was consistent at 491 homes (31 December 2023: 490 homes).
Gross margin was 28.2% (2023: 28.1%), this flowed through to an operating
profit of £47.4 million (2023: £35.3 million) and an operating profit margin
of 25.4% (2023: 24.7%).
The total plots in the landbank stood at 3,214 (31 December 2023: 2,755), with
net operating assets** of £89.5 million (31 December 2023: £94.0 million).
Balance sheet
Net assets at 31 December 2024 decreased to £4,405.2 million (31 December
2023: £4,523.4 million), with net operating assets decreasing marginally by
£6.7 million (0.2)%, to £3,817.0 million (31 December 2023: £3,823.7
million). Return on net operating assets** decreased to 10.9% (31 December
2023: 12.6%) due primarily to the reduction in Group operating profit. Group
net operating asset turn(†*) was 0.89 times (31 December 2023: 0.94),
reflecting both the decreased revenue and slightly higher average net
operating assets.
Land
Land as at 31 December 2024 increased by £118.0 million in the period to
£3,387.5 million due to being active and opportunistic in reviewing land
opportunities, resulting in land creditors increasing to £627.9 million (31
December 2023: £516.1 million). Included within the gross land creditor
balance is £39.9 million of UK land overage commitments (31 December 2023:
£44.9 million). £355.9 million of the land creditors is expected to be paid
within 12 months and £272.0 million thereafter (31 December 2023: £301.2
million and £214.9 million).
As at 31 December 2024, the UK short term landbank comprised 78,626 plots (31
December 2023: 80,323), with a net book value of £2.9 billion (31 December
2023: £2.8 billion). Short term owned land had a net book value of £2.9
billion (31 December 2023: £2.7 billion), representing 65,521 plots (31
December 2023: 61,190). The controlled short term landbank represented 13,105
plots (31 December 2023: 19,133).
The value of strategic owned land decreased to £180 million (31 December
2023: £242 million), representing 31,764 plots (31 December 2023: 34,319),
with a further total controlled strategic pipeline of 104,375 plots (31
December 2023: 107,676). Total potential revenue in the owned and controlled
landbank was £60 billion (31 December 2023: £61 billion).
Work in progress (WIP)
Total WIP investment, excluding part exchange and other, increased to
£1,949.3 million (31 December 2023: £1,871.0 million), due to build cost
inflation and preparing for volume growth in 2025 and beyond, including new
site infrastructure. Average WIP per UK outlet also increased as a result to
£8.9 million (31 December 2023: £7.6 million).
Provisions and deferred tax
Provisions increased to £306.7 million (31 December 2023: £286.7 million)
due to the £88.0 million increase in the first half of the year in the
cladding fire safety provision, which in the second half of the year was
reduced by £19.1 million as a joint venture recognised a provision for those
works directly. This net £68.9 million increase was partly offset by
utilisation of that provision (£28.5 million) as works have been carried out,
as well as utilisation in other provisions which largely relate to remedial
works on a limited number of sites around the Group.
The net deferred tax asset of £20.6 million (31 December 2023: £23.4
million) relates to the pension deficit and UK and Spanish provisions that are
tax deductible when the expenditure is incurred.
Pensions
During 2023, the Group engaged with the Trustee of the Taylor Wimpey Pension
Scheme (TWPS) on the triennial valuation of the Scheme with a reference date
of 31 December 2022. The valuation was concluded in March 2024 and showed that
the TWPS had a surplus of £55 million on its Technical Provisions funding
basis and a funding level of 103%. As a result, no deficit contributions were
required to be paid to the TWPS or to the escrow account established following
the 2019 valuation. The escrow account will remain in place until 30 June
2028, at which point a funding test will be conducted and funds will either be
paid to TWPS or returned to the Group.
In March 2024, the Group also reached agreement with the Trustee to
restructure the Group's Pension Funding Partnership (PFP). The restructure
retained the existing contributions payable until 2029 but replaced the
payment of up to £100 million that may have been due in 2029, with seven
annual payments of up to £12.5 million each from 2029 to 2035. These are only
payable if the TWPS has a deficit on its Technical Provisions funding basis at
the prior 31 December.
The Group continues to provide a contribution for Scheme expenses (£2.0
million per year) and also makes contributions via the PFP (£5.1 million per
year). Total Scheme contributions and expenses in the period were £7.1
million (2023: £7.1 million) with no further amounts paid into the escrow
account (2023: nil). At 31 December 2024, the IAS 19 valuation of the Scheme
was a surplus of £90.2 million (31 December 2023: £76.7 million). Due to the
rules of the TWPS, any surplus cannot be recovered by the Group and therefore
a deficit has been recognised on the balance sheet under IFRIC 14. The deficit
is equal to the present value of the remaining committed payments and any
forecasted distributions from the PFP.
Retirement benefit obligations of £22.2 million at 31 December 2024 (31
December 2023: £26.5 million) comprise a defined benefit pension liability of
£22.0 million (31 December 2023: £26.3 million) and a post-retirement
healthcare liability of £0.2 million (31 December 2023: £0.2 million).
The Group continues to work closely with the Trustee in managing pension
risks, including management of interest rate, inflation and longevity risks.
Net cash and financing position
Net cash decreased to £564.8 million at 31 December 2024 from £677.9 million
at 31 December 2023, due primarily to the increased investment in WIP. Average
net cash for the year was £494.5 million (31 December 2023: £606.6 million).
Despite the decrease in completions in the period, management of land and WIP
spend has resulted in a cash conversion(‡‡) of 74.9% of operating profit
for the year ended 31 December 2024 (2023: 61.4%).
Net cash, combined with land creditors, resulted in an adjusted
gearing(‡‡‡‡) of 1.4% (31 December 2023: (3.6)%).
At 31 December 2024, our committed borrowing facilities were £683 million, of
which the £600 million revolving credit facility was undrawn throughout the
period. The weighted average maturity of the committed borrowing facilities at
31 December 2024 was 4.6 years (31 December 2023: 4.8 years). During the year
an extension of one year to 2029 was agreed for the revolving credit facility.
The revolving credit facility includes three sustainability-linked performance
measures to be assessed and verified annually, which can have a minor impact
on the margin. The three performance measures are: reductions in scope 1 and 2
GHG emissions; reductions in waste; and reductions in carbon emissions of the
homes we build. These measures align with our environment strategy, Building a
Better World.
Dividends
Subject to shareholder approval at the AGM scheduled for 30 April 2025, the
2024 final ordinary dividend of 4.66 pence per share will be paid on 9 May
2025 to shareholders on the register at the close of business on 28 March 2025
(2023 final dividend: 4.79 pence per share). In combination with the 2024
interim dividend of 4.80 pence per share this gives total ordinary dividends
for the year of 9.46 pence per share (2023 ordinary dividend: 9.58 pence per
share).
The dividend will be paid as a cash dividend, and shareholders have the option
to reinvest all of their dividend under the Dividend Re-Investment Plan
(DRIP), details of which are available on our website:
www.taylorwimpey.co.uk/corporate (http://www.taylorwimpey.co.uk/corporate) .
Going concern
The Directors remain of the view that the Group's financing arrangements and
balance sheet strength provide both the necessary liquidity and covenant
headroom to enable the Group to conduct its business for at least the next 12
months from the date of signature of the 2024 financial statements.
Accordingly, the financial statements are prepared on a going concern basis,
see Note 1 of the Condensed Consolidated Financial Statements for further
details of the assessment performed.
Viability disclosure
In accordance with the 2018 UK Corporate Governance Code, the Directors and
the senior management team have assessed the prospects and financial viability
of the Group for a period longer than the 12 months required for the purpose
of the 'going concern' assessment.
Time period
The Directors have assessed the viability of the Group over a five-year
period, taking account of the Group's current financial position, current
market circumstances and the potential impact of the Principal and emerging
risks facing the Group. The Directors have determined this as an appropriate
period over which to assess the viability based on the following:
- It is aligned with the Group's bottom-up five-year budgeting and
forecasting cycle
- Five years represents a reasonable estimate of the typical time
between purchasing land, its progression through the planning cycle, building
out the development and selling homes to customers from it
Five years is also a reasonable period for consideration given the following
broader external trends:
- The cyclical nature of the market in which the Group operates,
which tends to follow the economic cycle
- Consideration of the impact of government policy, planning
regulations and the mortgage market
- Long term supply of land, which is supported by our strategic land
pipeline
- Changes in technology and customer expectations
Assessment of prospects
We consider the long term prospects of the Group in light of our business
model. Our strategy to deliver sustainable value is achieved through
delivering high-quality homes for our customers, in the locations where people
want to live, whilst carefully managing our cost base and the Group's balance
sheet.
In assessing the Group's prospects and long term viability, due consideration
is given to:
• The Group's current performance and the Group's financing
arrangements
• The wider economic environment and mortgage market, as well as
changes to government policies and regulations, including those influenced by
sustainability, climate change and the environment, that could impact the
Group's business model
• Strategy and business model flexibility, including customer
dynamics and approach to land investment
• Principal Risks associated with the Group's strategy and business
model, including those which have the most impact on our ability to remain in
operation and meet our liabilities as they fall due
Principal Risks
The Principal Risks, to which the Group is subject, have undergone a
comprehensive review by the GMT and Board in the current year. Consideration
is given to the risk likelihood based on the probability of occurrence and
potential impact on our business, together with the effectiveness of
mitigations.
The Directors identified the Principal Risks that have the most impact on the
longer term prospects and viability of the Group, and as such these have been
used in the modelling of a severe but plausible downside scenario, as:
· Government policies, regulations and planning (A)
· Mortgage availability and housing demand (B)
· Availability and costs of materials and subcontractors (C)
· Quality and reputation (F)
· IT environment and security (I)
A range of sensitivity analyses for these risks together with likely
mitigating actions that would be adopted in response to these circumstances
were modelled, including a severe but plausible downside scenario in which the
impacts were aggregated together.
The impact from 'Natural resources and climate change' (H) is not deemed to be
material within the five-year forecast period, as costs associated with the
regulatory changes have been included in the modelling.
Assessment of viability
The Group adopts a disciplined annual business planning process involving the
management teams of the UK regional businesses and Spain, and the Group's
senior management, and is built on a bottom-up basis. This planning process
covers a five-year period comprising a detailed budget for the next financial
year, together with a forecast for the following four financial years
('forecast').
The financial planning process considers the Group's profitability and Income
Statement, Balance Sheet including landbank, gearing and debt covenants, cash
flows and other key financial metrics over the forecast period. These
financial forecasts are based on a number of key assumptions, the most
important of which include:
- Timing and volume of legal completions of new homes sold, which
includes annual production volumes and sales rates over the life of the
individual developments
- Average selling prices achieved
- Build costs and cost of land acquisitions
- Working capital requirements
- Capital repayment plan, where we have assumed the payment of the
ordinary dividend in line with the current policy, which is a minimum of £250
million or 7.5% of the Group's net assets per annum, throughout the period
Stress testing our risk resilience
The assessment considers sensitivity analysis on a series of realistically
possible, but severe and prolonged, changes to principal assumptions.
In determining these we have included macroeconomic and industry-wide
projections as well as matters specific to the Group.
The severe but plausible downside scenario reflects the aggregated impact of
sensitivities, taking account of a further decline in customer confidence,
disposable incomes and mortgage availability. To arrive at our stress test we
have drawn on experience gained from managing the business through previous
economic downturns.
We have applied the market dynamics encountered at those times, as well as the
mitigations adopted, to our 2025 expectations in order to test the resilience
of our business. As a result, we have stress tested our business against the
following severe but plausible downside scenario, which can be attributed back
to the Group's Principal Risks that have been identified as having the most
impact on the longer term prospects and viability of the Group.
Volume (Principal Risk: A, B, C, F) - a further decline in total volumes of
10% in 2025 from 2024 levels, before recovering back to 2024 levels by 2027.
Price (Principal Risk: B) - a reduction to current selling prices of 5%,
remaining at these levels across 2025 and 2026 before recovering to current
levels by 2027.
One-off costs (Principal Risk: A, F, I) - a one-off exceptional charge and
cash cost of £150 million for an unanticipated event, change in government
regulations or financial penalty has been included in 2025.
Within the scenario, current build costs are forecast to increase by 2% in
2025 but further cost increases will be minimised due to lower volumes
reducing demand for materials and resources. Land cost also remains broadly
flat, as the possible increase in availability due to lower volumes is offset
by a restriction in supply.
The mitigating actions considered in the model include a continued reduction
in land investment, a reduction in the level of production and work in
progress held and further reducing our overhead base to reflect the lower
volumes.
If this scenario were to occur, the Directors also have a range of additional
options to maintain financial strength, including a more severe reduction in
land spend and work in progress, the sale of assets, reducing the dividend
and/or raising debt.
At 31 December 2024, the Group had a cash balance of £647 million and access
to £600 million from a fully undrawn revolving credit facility, together
totalling £1,247 million. The combination of both of these is sufficient to
absorb the financial impact of each of the risks modelled in the stress and
sensitivity analysis, individually and in aggregate.
Confirmation of viability
Based on the results of this analysis, the Directors have a reasonable
expectation that the Group will be able to continue in operation and meet its
liabilities as they fall due over the five-year period of their assessment.
Definitions
* Operating profit is defined as profit on ordinary activities before
financing, exceptional items and tax, after share of results of joint
ventures.
*(†) Operating profit margin is defined as operating profit divided by
revenue.
** Return on net operating assets (RONOA) is defined as rolling 12 months'
operating profit divided by the average of the opening and closing net
operating assets of the 12-month period, which is defined as net assets less
net cash, excluding net taxation balances and accrued dividends.
(†) Tangible net assets per share is defined as net assets before any
accrued dividends, excluding intangible assets, divided by the number of
ordinary shares in issue at the end of the period.
(††) Adjusted basic earnings per share represents earnings attributed to
the shareholders of the parent, excluding exceptional items and tax on
exceptional items, divided by the weighted average number of shares in issue
during the period.
(†)* Net operating asset turn is defined as 12 months' rolling total revenue
divided by the average of opening and closing net operating assets of the
12-month period.
(†***) The Annual Injury Incidence Rate (AIIR) is defined as the number of
incidents per 100,000 employees and contractors, calculated on a rolling
12-month basis, where the number of employees and contractors is calculated
using a monthly average over the same period.
(‡) Net cash is defined as total cash less total borrowings.
(‡‡) Cash conversion is defined as operating cash flow divided by
operating profit on a rolling 12-month basis, with operating cash flow defined
as cash generated from operations (which is before income taxes paid, interest
paid and payments related to exceptional charges).
(‡‡‡‡) Adjusted gearing is defined as adjusted net debt divided by net
assets. Adjusted net debt is defined as net cash less land creditors.
The Group uses Alternative Performance Measures (APMs) as important financial
performance indicators to assess underlying performance of the Group. The
Group's two main financial targets are operating profit margin and return on
net operating assets. Definitions and reconciliations to the equivalent
statutory measures are included in Note 13 of the Condensed Consolidated
Financial Statements.
Shareholder information
The Company's 2025 Annual General Meeting (AGM) will be held at 10:30am on 30
April 2025 in the Gerrards Suite at the Crowne Plaza Gerrards Cross, Oxford
Road, Beaconsfield, HP9 2XE.
Copies of the Annual Report and Accounts 2024 will be available from 25 March
2025 on the Company's website www.taylorwimpey.co.uk/corporate. Hard copy
documents will be posted to shareholders who have elected to receive them and
will also be available from our registered office at Gate House, Turnpike
Road, High Wycombe, Buckinghamshire, HP12 3NR from 27 March 2025.
A copy of the Annual Report and Accounts 2024 will be submitted to the
National Storage Mechanism and will be available for inspection at:
https://data.fca.org.uk/#/nsm/nationalstoragemechanism
(https://data.fca.org.uk/#/nsm/nationalstoragemechanism)
Directors' responsibilities
The responsibility statement below has been prepared in connection with the
full Annual Report and Accounts for the year ended 31 December 2024. Certain
parts thereof are not included within this announcement.
We confirm to the best of our knowledge that:
· the Group financial statements, which have been prepared in
accordance with UK-adopted international accounting standards, give a true and
fair view of the assets, liabilities, financial position and profit of the
Group; and
· the Strategic report includes a fair review of the development and
performance of the business and the position of the Group and Company,
together with a description of the Principal Risks and uncertainties that it
faces.
This responsibility statement was approved by the Board of Directors on 26
February 2025 and is signed on its behalf by:
Robert Noel, Chair
Jennie Daly, Chief Executive
Principal Risks and uncertainties
The Board has overall responsibility for risk oversight, for maintaining a
robust risk management and internal control system and for determining the
Group's appetite and tolerance for exposure to the Principal Risks to the
achievement of its strategy. Our Annual Report and Accounts 2024 details the
full governance procedures and processes for identification and subsequent
monitoring of the risks undertaken by the Group.
The Audit Committee supports the Board in the management of risk and is
responsible for reviewing the effectiveness of the risk management and
internal control processes during the year.
The Chief Executive is primarily responsible for the management of the risks
with the support of the GMT and other senior managers located in the business.
In line with the 2018 UK Corporate Governance Code, the Board holds formal
risk reviews at least half yearly and routinely considers risk at each Board
meeting as appropriate. The formal assessment includes a robust consideration
of the Principal Risks, to ensure they remain appropriate, a review of the key
risks identified by the business, their risk profiles and mitigating factors,
and an annual review of the established risk appetite and tolerance levels.
During the year, one of our Principal Risks ('Mortgage availability and
housing demand') saw an increase in its inherent and residual profiles,
primarily due to a new key risk being identified around availability of
funding for affordable housing, impacting demand. In addition, the previously
named 'Cyber security' Principal Risk has been renamed 'IT environment and
security', although there is no change to the coverage of the risk. Our
Principal Risks are described in more detail in the tables below.
The Board also considers emerging risks which could impact on the Group's
ability to deliver its strategy. The emerging risks are those where the extent
and implications are not yet fully understood but consideration has been given
to the potential timeframe of occurrence and velocity of impact that these
could have on the Group. As part of our risk management process, these are
monitored and reviewed on an ongoing basis and discussed and agreed by the
Board.
Our emerging risks are grouped into the categories listed in the table below,
which also contains some narrative description against each category
indicating example focus areas into which the identified emerging risks fall.
Category Example focus area
Environmental/climate Unpredictable weather patterns
Operational/build Adaption of building methodologies
Political/economic Geopolitical uncertainty
Social Customer demographics and preferences
Governmental Changing Government policies
The Group considers other specific risk areas recognising the increasing
complexity of the industry in which it operates and which are in addition to
its identified Principal Risks. We continue to monitor and mitigate the
impacts on our supply chain and labour force and the overall economic market
impacting mortgage availability and demand.
Our Sustainability and Climate Change Risk and Opportunity Register highlights
the material risks and opportunities facing the Group in relation to
sustainability and climate change. In addition, our climate change-related
risks and opportunities are available as part of our 2024 CDP submission. More
information is available at www.taylorwimpey.co.uk/corporate
(http://www.taylorwimpey.co.uk/corporate) .
The Principal Risks, their mitigations and risk indicators are detailed below:
Description Residual risk rating Risk appetite Example risk indicators, mitigations and opportunities
A. Government policies, regulations and planning Moderate Low Example risk indicators
The industry in which we operate is becoming increasingly regulated. Failure New government regulations (e.g. around planning and climate)
to adhere to government regulations could impact our operational performance
and our ability to meet our strategic objectives. - Delays in planning
Changes to the planning system or planning delays could result in missed - Sentiment towards the industry (e.g. cladding fire safety remediation)
opportunities to optimise our landbank, affecting profitability and production
delivery.
Accountability Key mitigations
Group Technical Director - Research conducted to update technical specification of our new house type
range, in preparation for the Future Homes Standard (FHS), including a trial
Director of Planning of five FHS-compliant plots
Regional Managing Directors - Consultation with government agencies
- Cladding fire safety remediation and signing of the Government's Building
Safety Pledge for Developers
- Engagement with national and local government
- Working with HBF and other stakeholders
- Member of Future Homes Hub
Opportunities
To build enhanced collaborative networks with stakeholders and peers, to
monitor the implications of regulatory change.
Lead the business in addressing pressing environmental issues, including
reducing our carbon footprint and targeting biodiversity.
Description Residual risk rating Risk appetite Example risk indicators, mitigations and opportunity
B. Mortgage availability and housing demand Moderate Low Example risk indicators
A decline in the economic environment, driven by sustained growth in interest - Interest rate increases
rates, increased cost of living, low wage inflation or increasing levels of
unemployment, could result in tightened mortgage availability and challenge - Levels of unemployment
mortgage affordability for our customers, resulting in a direct impact on our
volume targets. - Volume of enquiries/people visiting our developments
- UK household spending/levels of disposable income
Accountability - Loan to value metrics
UK Sales and Marketing Director - Number and value of bids from affordable housing providers
Regional Sales and Marketing Directors
Key mitigations
- Increase outlets to provide greater customer choice and flexibility to
respond quickly to changing market conditions
- Review of pricing and incentives offered
- Monitor external market data (e.g. HBF and mortgage lenders)
- Strong relationships with mainstream lenders
- Work with financial services industry to ensure customers receive
appropriate advice on mortgage products
Opportunities
To continue to develop strong working relationships with established
mainstream lenders and those wishing to increase volume in the new build
market.
Description Residual risk rating Risk appetite Example risk indicators, mitigations and opportunity
C. Availability and costs of materials and subcontractors Moderate Low-moderate Example risk indicators
Increase in housing demand and production or a breakdown within the supply - Material and trade shortages
chain may further strain the availability of skilled subcontractors and
materials and put pressure on utility firms to keep up with the pace of - Material and trade price increases
installation, resulting in increased costs and construction delays.
- Level of build quality and waste produced from sites
Accountability
- Longer build times
Supply Chain Director
- Number of skilled trades
Procurement Director
Key mitigations
Group Commercial Director
- Central procurement and key supplier agreements
- Supplier and subcontractor relationships
- Disaster recovery and business continuity plans with all key suppliers
- Buffer stock with key suppliers
- Contingency plans for critical path products
- Direct trade and apprenticeship programmes
- Key commodity risk assessment matrix
- Regular checks on all key suppliers
- Monitoring of the supply chain
Opportunities
To develop and implement different build methods as alternatives to
conventional brick and block.
Description Residual risk rating Risk appetite Example risk indicators, mitigations and opportunity
D. Attract and retain high-calibre employees Low Moderate Example risk indicators
An inability to attract, develop, motivate and retain high-calibre employees, - Employee engagement score
together with a failure to consider the retention and succession of key
management, could result in a failure to deliver our strategic objectives, a - Number of, and time to fill, vacancies
loss of corporate knowledge and a loss of competitive advantage.
- Employee turnover levels
Key mitigations
Accountability
- Production Academy and Production Manager succession development programme
Group HR Director
- Schools outreach strategy
Every employee managing people
- Collaboration with major organisations on sector skills plan
- Graduate and apprenticeship programmes
- Management training
- Enhanced remote working procedures
- Educational masterclasses
- Salary benchmarking
Opportunities
To further develop in-house capability, expertise and knowledge.
Description Residual risk rating Risk appetite Example risk indicators, mitigations and opportunity
E. Land availability Low Moderate Example risk indicators
An inability to secure land at an appropriate cost, the purchase of land of - Movement in landbank years
poor quality or in the wrong location, or the incorrect timing of land
purchases in relation to the economic cycle could impact future profitability. - Number of land approvals
- Timing of conversions from strategically sourced land
Accountability
Divisional Chairs
Regional Managing Directors
Regional Land and Planning Directors Key mitigations
Managing Director Group Strategic Land - Critically assess opportunities
Group Land Director - Land quality framework
- Engagement with national and local government
- Review of land portfolio
- Obtaining specialist environmental and legal advice
Opportunities
A strong balance sheet allows us to invest when land market conditions are
attractive.
Description Residual risk rating Risk appetite Example risk indicators, mitigations and opportunity
F. Quality and reputation Moderate Low Example risk indicators
The quality of our products is key to our strategic objective of being a - Customer satisfaction scores (8-week and 9-month)
customer-focused business and in ensuring that we do things right first time.
- Number of NHBC claims
If the Group fails to deliver against these standards and its wider
development obligations, it could be exposed to reputational damage, as well - Construction Quality Review (CQR) scores
as reduced sales and increased costs.
- Average reportable items per inspection found during NHBC inspections at key
Accountability stages of the build
Customer Director
UK Head of Production Key mitigations
Director of Design - Customer-ready Home Quality Inspection
- Consistent Quality Approach
- Quality Managers in the business
- Customer-driven strategy
- Enhanced data analytics
- Ombudsman readiness
Opportunities
To better understand the needs of our customers, enabling increased
transparency of our build profile.
To lead the industry in quality standards (our CQR score) and reduce the
number of reportable items identified through monitoring defects at every
stage of build.
Description Residual risk rating Risk appetite Example risk indicators, mitigations and opportunity
G. Health, safety and environment Low Low Example risk indicators
The health and safety of all our employees, subcontractors, visitors and - Increase in near misses and fatalities
customers is of paramount importance. Failure to implement and monitor our
stringent health, safety and environment (HSE) procedures and policies across - Health and safety audit outcomes
all parts of the business could lead to accidents or site-related incidents,
resulting in serious injury or loss of life. - Number of reportable health and safety incidents
Accountability
Head of Health, Safety and Environment Key mitigations
Regional Managing Directors - Embedded HSE system
- HSE training and inductions
- Mental health training and support for all employees
- Robust monitoring and reporting procedures
- Utilisation of certified operatives
- Identification, review and evaluation of the impact of new construction
methods and materials
Opportunities
To lead the industry in health and safety and to reduce the amount and level
of incidents.
Description Residual risk rating Risk appetite Example risk indicators, mitigations and opportunity
H. Natural resources and climate change Moderate Low Example risk indicators
An inability to reduce our environmental footprint, the challenges of a - Energy use and greenhouse gas emissions
degraded environment including the impacts of climate change, nature loss and
water scarcity on our business, supply chain scarcity due to environmental - Biodiversity net gain %
change and the increasing desire of our customers to live more sustainably
could impact our reputation, ability to attract investment and obtain planning - Construction waste generation and waste to landfill
permission and the delivery of our strategic targets.
Accountability
Key mitigations
Director of Sustainability
- Net Zero Transition Plan
Regional Managing Directors
- Published Environment Strategy
- Adopted and verified science-based targets
- Climate change governance, including LEAF Committee and sustainability
champions
- Achievement of Carbon Trust Standard
- HBF and investor liaison
- Training and development in house and in our supply chain
- External benchmarking
- Collection and interpretation of data to drive relevant actions
Opportunities
Sustainable homes and developments attractive to customers.
A sustainable business of choice for investors.
Advantageous planning positions.
Description Residual risk rating Risk appetite Example risk indicators, mitigations and opportunity
I. IT environment and security Moderate Low-moderate Example risk indicators
The Group places increasing reliance on IT to conduct its operations and the - Number of devices with critical and high open vulnerabilities
requirement to maintain the accuracy and confidentiality of its information
systems and the data contained therein. A cyber-attack leading to the - Number of devices without latest patching in place
corruption, loss or theft of data could result in reputational and operational
damage. - Phishing test results
- Cyber training completion statistics
Accountability - Number of users with administrative privileges to critical systems
IT Director
Key mitigations
- Complex passwords policy and multi-factor authentication for remote access
- Regular security patching and penetration testing
- Risky logins check
- Intrusion detection and prevention systems
- Suspected phishing emails process
- Mandated cyber training for all staff
- Cyber insurance
- Dedicated Head of Cyber Security
- Cyber security KPIs
- Enhanced end-point protection software implemented across the IT estate
- Blocked traffic originating from countries deemed a threat to the UK
Opportunities
Together with our service partners, provide a level of security to reinforce
our reputation as a trusted partner.
Cautionary note concerning forward looking statements
This report contains certain forward-looking statements. These statements are
made by the Directors and include statements regarding their current
intentions, beliefs and expectations, based on the information available to
them up to the time of their approval of this report and unless otherwise
required by applicable law, the Company and its Directors undertake no
obligation to update or revise these forward looking statements, nor do they
accept any liability should the future results actually achieved fail to
correspond to the forward-looking statements included in this report.
By their nature these forward-looking statements involve uncertainty
(including both economic and business risk factors) and are subject to a
number of risks since future events and circumstances can cause actual results
and developments to differ materially to those anticipated. As such, these
forward-looking statements should be treated with caution.
Nothing in this report should be construed as a profit forecast and does not
constitute or form part of, any offer, invitation or the solicitation of an
offer to purchase, otherwise acquire, subscribe for, sell or otherwise dispose
of, any securities in Taylor Wimpey plc or any other invitation or inducement
to engage in investment activities and does not constitute a recommendation to
sell or buy any such securities.
Consolidated Income Statement
for the year to 31 December 2024
£ million Note Before Exceptional items Total Before Exceptional Total
exceptional
2024
exceptional
items
2023
items 2024
items
2024
2023 2023
Continuing operations
Revenue 2 3,401.2 - 3,401.2 3,514.5 - 3,514.5
Cost of sales (2,752.5) - (2,752.5) (2,798.0) - (2,798.0)
Gross profit 648.7 - 648.7 716.5 - 716.5
Net operating expenses 4 (232.3) (82.5) (314.8) (248.7) - (248.7)
Profit on ordinary activities 416.4 (82.5) 333.9 467.8 - 467.8
before financing
Finance income 5 29.7 - 29.7 29.5 - 29.5
Finance costs 5 (27.4) - (27.4) (25.9) - (25.9)
Share of results of joint ventures (0.2) (15.7) (15.9) 2.4 - 2.4
Profit before taxation 418.5 (98.2) 320.3 473.8 - 473.8
Taxation (charge)/credit 6 (120.9) 20.2 (100.7) (124.8) - (124.8)
Profit for the year 297.6 (78.0) 219.6 349.0 - 349.0
2024 2023
Basic earnings per share 7 6.2p 9.9p
Diluted earnings per share 7 6.2p 9.9p
Adjusted basic earnings per share 7 8.4p 9.9p
Adjusted diluted earnings per share 7 8.4p 9.9p
All of the profit for the year is attributable to the equity holders of the
Parent Company.
Consolidated Statement of Comprehensive Income
for the year to 31 December 2024
£ million Note 2024 2023
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translation of foreign operations (8.8) (2.4)
Movement in fair value of hedging instruments 3.9 1.2
Items that will not be reclassified subsequently to profit or loss:
Actuarial gain on defined benefit pension schemes 10 1.4 0.8
Tax charge on items taken directly to other comprehensive income 8 (0.4) (0.2)
Other comprehensive expense for the year (3.9) (0.6)
Profit for the year 219.6 349.0
Total comprehensive income for the year 215.7 348.4
All of the comprehensive income for the year is attributable to the equity
holders of the Parent Company.
Consolidated Balance Sheet
at 31 December 2024
£ million Note 2024 2023
Non-current assets
Intangible assets 1.5 2.6
Property, plant and equipment 21.9 22.0
Right-of-use assets 35.9 37.8
Interests in joint ventures 26.9 70.5
Trade and other receivables 14.9 28.1
Other financial assets 10 10.8 10.3
Deferred tax assets 8 20.6 23.4
132.5 194.7
Current assets
Inventories 9 5,376.6 5,169.6
Trade and other receivables 130.4 124.4
Tax receivables 4.4 -
Cash and cash equivalents 647.4 764.9
6,158.8 6,058.9
Total assets 6,291.3 6,253.6
Current liabilities
Trade and other payables (1,083.9) (992.8)
Lease liabilities (10.4) (8.8)
Tax payables (1.6) (1.6)
Provisions (161.7) (124.9)
(1,257.6) (1,128.1)
Net current assets 4,901.2 4,930.8
Non-current liabilities
Trade and other payables (350.7) (295.8)
Lease liabilities (28.0) (31.0)
Bank and other loans (82.6) (87.0)
Retirement benefit obligations 10 (22.2) (26.5)
Provisions (145.0) (161.8)
(628.5) (602.1)
Total liabilities (1,886.1) (1,730.2)
Net assets 4,405.2 4,523.4
Equity
Share capital 291.3 291.3
Share premium 777.9 777.9
Own shares (27.6) (29.7)
Other reserves 539.5 544.4
Retained earnings 2,824.1 2,939.5
Total equity 4,405.2 4,523.4
Consolidated Statement of Changes in Equity
for the year to 31 December 2024
£ million Note Share Share Own Other Retained earnings Total
capital
premium
shares
reserves
Total equity at 1 January 2023 291.3 777.9 (43.1) 545.6 2,930.4 4,502.1
Other comprehensive (expense)/income for the year - - - (1.2) 0.6 (0.6)
Profit for the year - - - - 349.0 349.0
Total comprehensive (expense)/income for the year - - - (1.2) 349.6 348.4
Utilisation of own shares - - 13.4 - - 13.4
Cash cost of satisfying share options - - - - (12.6) (12.6)
Share-based payment credit - - - - 8.9 8.9
Tax credit on items taken directly to statement of changes in equity 8 1.1
- - - - 1.1
Dividends approved and paid 12 - - - - (337.9) (337.9)
Total equity at 31 December 2023 291.3 777.9 (29.7) 544.4 2,939.5 4,523.4
Other comprehensive (expense)/income for the year - - - (4.9) 1.0 (3.9)
Profit for the year - - - - 219.6 219.6
Total comprehensive (expense)/income for the year - - - (4.9) 220.6 215.7
Own shares acquired - - (4.0) - - (4.0)
Utilisation of own shares - - 6.1 - - 6.1
Cash cost of satisfying share options - - - - (5.4) (5.4)
Share-based payment credit - - - - 9.2 9.2
Tax charge on items taken directly to statement of changes in equity 8 (0.4)
- - - - (0.4)
Dividends approved and paid 12 - - - - (339.4) (339.4)
Total equity at 31 December 2024 291.3 777.9 (27.6) 539.5 2,824.1 4,405.2
Consolidated Cash Flow Statement
for the year to 31 December 2024
£ million Note 2024 2023
Profit on ordinary activities before financing 333.9 467.8
Adjustments for:
Depreciation and amortisation 14.3 12.7
Pension contributions in excess of charge to the income statement (4.0) (3.8)
Share-based payment charge 9.2 8.9
Loss on disposal of assets 14.5 0.3
Increase in provisions excluding exceptional payments 53.9 17.3
Operating cash flows before movements in working capital 421.8 503.2
Increase in inventories (86.8) (148.7)
Decrease in receivables 3.8 40.2
Decrease in payables (27.1) (105.8)
Cash generated from operations 311.7 288.9
Payments related to exceptional charges (34.1) (20.8)
Income taxes paid (102.5) (126.5)
Interest paid (10.2) (12.0)
Net cash generated from operating activities 164.9 129.6
Investing activities:
Interest received 28.1 26.4
Dividends received from joint ventures - 11.7
Proceeds on disposal of property, plant and equipment 0.1 -
Purchase of property, plant and equipment (3.4) (6.8)
Purchase of software - (0.1)
Proceeds on disposal of joint venture 18.5 -
Amounts received from/(invested in) joint ventures 30.6 (3.8)
Net cash generated from investing activities 73.9 27.4
Financing activities:
Lease capital repayments (9.6) (7.9)
Cash received on exercise of share options 0.7 3.0
Purchase of own shares (4.0) -
Repayment of borrowings - (87.0)
Proceeds from borrowings - 87.0
Dividends paid (339.4) (337.9)
Net cash used in financing activities (352.3) (342.8)
Net decrease in cash and cash equivalents (113.5) (185.8)
Cash and cash equivalents at beginning of year 764.9 952.3
Effect of foreign exchange rate changes (4.0) (1.6)
Cash and cash equivalents at end of year 11 647.4 764.9
Notes to the Condensed Consolidated Financial Statements
1. Basis of preparation
These results do not constitute the Group's statutory accounts for the year
ended 31 December 2024 but are derived from those accounts. Statutory accounts
for 2023 have been delivered to the Registrar of Companies and those for 2024
will be delivered following the Company's Annual General Meeting. The external
auditors have reported on those accounts; its report was unqualified, did not
contain an emphasis of matter paragraph and did not contain any statements
under section 498 of the Companies Act 2006.
The consolidated financial statements are prepared in accordance with
UK-adopted international accounting standards. The statutory accounts have
been prepared based on the accounting policies and method of computations
consistent with those followed in the preparation of the Group's annual
financial statements for the year ended 31 December 2023.
Going concern
Group forecasts have been prepared that have considered the Group's current
financial position and current market circumstances. The forecasts were
subject to sensitivity analysis, including a severe but plausible scenario
together with the likely effectiveness of mitigating actions.
The assessment considered sensitivity analysis based on a number of
realistically possible, but severe and prolonged, changes to principal
assumptions. In determining these, the Group included macroeconomic and
industry wide projections, as well as matters specific to the Group. To arrive
at the sensitivity analysis, the Group has also drawn on experience gained
managing the business through previous economic downturns and stress tested
the business against a number of scenarios including:
- Volume - a further decline in total volumes of 10% in 2025 from 2024
levels, before recovering back to 2024 levels by 2027
- Price - a reduction to current selling prices of 5%, remaining at
these levels across 2025 and 2026 before recovering to current levels by 2027
- Costs - a one-off exceptional charge and cash cost of £150 million
for an unanticipated event, change in government regulations or financial
penalty has been included in 2025
Mitigations to this sensitivity analysis include a reduction in land
investment, a reduction in the level of production and work in progress held
and optimising the overhead base to ensure it is aligned with the scale of the
operations through the cycle. If this scenario were to occur, the Directors
also have a range of additional options to maintain financial strength,
including a more severe reduction in land spend and work in progress, the sale
of assets, reducing the dividend and/or raising debt.
At 31 December 2024, the Group had a cash balance of £647 million and had
access to £600 million from a fully undrawn revolving credit facility,
together totalling £1,247 million. The combination of both of these is
sufficient to absorb the financial impact of each of the risks modelled in the
stress and sensitivity analysis, individually and in aggregate.
Based on these forecasts, it is considered that there are sufficient resources
available for the Group to conduct its business, and meet its liabilities as
they fall due, for at least the next 12 months from the date of these
consolidated financial statements. Consequently the consolidated financial
statements have been prepared on a going concern basis.
Notes to the Condensed Consolidated Financial Statements (continued)
2. Revenue
An analysis of the Group's continuing revenue is as follows:
£ million 2024 2023
Private sales 2,960.7 3,103.5
Partnership housing 404.1 395.6
Land and other 36.4 15.4
3,401.2 3,514.5
3. Operating segments
The Group operates in two countries, the United Kingdom and Spain.
The United Kingdom is split into five geographical operating segments, each
managed by a Divisional Chair who sits on the Group Management Team; there are
also central operations covering the corporate functions and Strategic Land.
The Group aggregates the UK operations into a single reporting segment on the
basis that they share similar economic characteristics. In addition, each
Division builds and delivers residential homes, uses consistent methods of
construction, sells homes to both private customers and local housing
associations, follows a single UK sales process and operating framework, is
subject to the same macro-economic factors including mortgage availability and
has the same cost of capital arising from the utilisation of central banking
and debt facilities. As a result, the disclosure reflects the two reportable
segments of the UK and Spain. Revenue in Spain arises entirely on private
sales.
2024 2023
£ million UK Spain Total UK Spain Total
Revenue
External sales 3,214.6 186.6 3,401.2 3,371.7 142.8 3,514.5
Result
Profit before joint ventures, finance income/(costs) and exceptional items 369.0 47.4 416.4 432.5 35.3 467.8
Share of results of joint ventures before exceptional items (0.2) - (0.2) 2.4 - 2.4
Operating profit (Note 13) 368.8 47.4 416.2 434.9 35.3 470.2
Exceptional items (Note 4) (98.2) - (98.2) - - -
Profit before net finance income 270.6 47.4 318.0 434.9 35.3 470.2
Net finance income 2.3 3.6
Profit before taxation 320.3 473.8
Taxation charge (100.7) (124.8)
Profit for the year 219.6 349.0
2024 2023
£ million UK Spain Total UK Spain Total
Segment operating assets 5,355.4 236.6 5,592.0 5,153.2 241.6 5,394.8
Joint ventures 26.9 - 26.9 70.5 - 70.5
Segment operating liabilities (1,654.8) (147.1) (1,801.9) (1,494.0) (147.6) (1,641.6)
Net operating assets 3,727.5 89.5 3,817.0 3,729.7 94.0 3,823.7
Net current taxation 2.8 (1.6)
Net deferred taxation 20.6 23.4
Net cash 564.8 677.9
Net assets 4,405.2 4,523.4
Notes to the Condensed Consolidated Financial Statements (continued)
3. Operating segments (continued)
2024 2023
£ million UK Spain Total UK Spain Total
Other information
Property, plant and equipment additions 3.3 0.1 3.4 6.6 0.2 6.8
Right-of-use asset additions 9.2 0.2 9.4 20.7 0.4 21.1
Software additions - - - 0.1 - 0.1
Property, plant and equipment depreciation (2.4) (0.1) (2.5) (1.7) (0.1) (1.8)
Right-of-use asset depreciation (10.4) (0.3) (10.7) (8.9) (0.3) (9.2)
Amortisation of intangible assets (1.1) - (1.1) (1.7) - (1.7)
4. Net operating expenses and profit on ordinary activities before financing
Profit on ordinary activities before financing for continuing operations has
been arrived at after charging/(crediting):
£ million 2024 2023
Administration expenses 242.0 232.7
Other expenses 101.4 101.7
Other income (111.1) (85.7)
Exceptional items 82.5 -
Net operating expenses 314.8 248.7
The majority of the other income and other expenses shown above relates to the
income and associated costs arising on the sale of part exchange properties.
Also included in other income and other expenses are profit/loss on the sale
of property, plant and equipment, the revaluation of certain shared equity
mortgage receivables and abortive land acquisition costs.
Exceptional items
£ million 2024 2023
Provision in relation to cladding fire safety 68.9 -
Loss on disposal of joint venture 13.6 -
82.5 -
Share of results of joint ventures 15.7 -
Total exceptional items 98.2 -
Cladding fire safety
In 2018 the Group established an exceptional provision for the cost of
replacing ACM on a small number of legacy developments. The provision was
increased subsequently to reflect guidance issued as well as the Group
signing, in 2022, the Government's Building Safety Pledge for Developers which
extended the period covered to all buildings constructed by the Group since
1992. The Group has reassessed the remediation costs based on tenders received
in the current year; based on this updated information and enhanced cost
appraisal, the expected costs have increased by £88.0 million, as reported in
the Group's half year results. The increase is due to escalation of costs on
recent tenders, a small number of new buildings being added and increased
project delivery administration costs, including the funding of Building
Safety Fund pre-tender costs. Given the detailed assessment performed based on
this information becoming available, the estimation uncertainty has reduced.
In addition in the second half of the year, one of the Group's joint ventures
has recognised a provision for remediation works on the buildings it built and
as a result £19.1 million has been released from the provision held by the
Group in relation to those buildings. The net impact is a £68.9 million
exceptional expense recognised in 2024 in relation to cladding fire safety.
Loss on disposal of joint venture
During the year, the Group disposed of its interest in Winstanley and York
Road Regeneration LLP and has recognised a £13.6 million loss arising from
the difference between proceeds on disposal and the Group's net investment in
the joint venture. This expense, being non-recurring, and outside of the
normal operations of the Group, has been recognised as an exceptional item.
Notes to the Condensed Consolidated Financial Statements (continued)
4. Net operating expenses and profit on ordinary activities before financing
(continued)
Share of results of joint ventures
As noted above a joint venture of the Group has recognised in the year a
provision for remediation costs on buildings it built. The Group's share of
that cost, net of tax, has been recognised as an exceptional item in line with
the recognition of the Group's cladding fire safety provision.
Profit on ordinary activities before financing has been arrived at after
charging:
£ million 2024 2023
Cost of inventories recognised as an expense in cost of sales 2,635.0 2,646.8
Property, plant and equipment depreciation 2.5 1.8
Right-of-use asset depreciation 10.7 9.2
Amortisation of intangible assets 1.1 1.7
5. Finance income and finance costs
£ million 2024 2023
Interest receivable 29.7 29.5
29.7 29.5
£ million 2024 2023
Interest on bank and other loans (8.0) (8.3)
Foreign exchange loss (0.1) (0.5)
(8.1) (8.8)
Unwinding of discount on land creditors and other items (16.7) (14.8)
Interest on lease liabilities (1.5) (1.0)
Net interest on pension liability (Note 10) (1.1) (1.3)
(27.4) (25.9)
Notes to the Condensed Consolidated Financial Statements (continued)
6. Taxation charge
Tax (charged)/credited in the income statement is analysed as follows:
£ million 2024 2023
Current tax:
UK: Current year (91.9) (116.6)
Adjustment in respect of prior years 4.1 1.8
Overseas: Current year (11.2) (6.7)
Adjustment in respect of prior years - 0.1
(99.0) (121.4)
Deferred tax:
UK: Current year (3.8) (2.5)
Adjustment in respect of prior years 2.7 (0.2)
Overseas: Current year (0.6) (0.7)
Adjustment in respect of prior years - -
(1.7) (3.4)
(100.7) (124.8)
Corporation tax is calculated at 29.0% (2023: 27.5%) of the estimated
assessable profit for the year in the UK. This includes corporation tax at the
rate of 25.0% (2023: 23.5%) for the year and residential property developer
tax at the rate of 4.0% (2023: 4.0%) on profits arising from residential
property development activities. Taxation outside the UK is calculated at the
rates prevailing in the respective jurisdictions. The tax charge for the year
includes an exceptional credit of £20.2 million relating to the cladding fire
safety provision and other exceptional items (2023: £nil).
The charge for the year can be reconciled to the profit per the income
statement as follows:
£ million 2024 2023
Profit before tax 320.3 473.8
Tax at the UK corporation tax rate of 29.0% (2023: 27.5%) (92.9) (130.3)
Net over provision in respect of prior years 6.8 1.7
Net impact of items that are not taxable or deductible (13.7) 0.1
(Derecognition)/recognition of deferred tax assets (2.8) 1.0
Other rate impacting adjustments 1.9 2.7
Tax charge for the year (100.7) (124.8)
Notes to the Condensed Consolidated Financial Statements (continued)
7. Earnings per share
2024 2023
Basic earnings per share 6.2p 9.9p
Diluted earnings per share 6.2p 9.9p
Adjusted basic earnings per share 8.4p 9.9p
Adjusted diluted earnings per share 8.4p 9.9p
Weighted average number of shares for basic earnings per share - million 3,538.5 3,530.4
Weighted average number of shares for diluted earnings per share - million 3,551.9 3,537.5
Adjusted basic and adjusted diluted earnings per share, which exclude the
impact of exceptional items and any associated net tax amounts, are presented
to provide a measure of the underlying performance of the Group. A
reconciliation of earnings attributable to equity shareholders used for basic
and diluted earnings per share to that used for adjusted earnings per share is
shown below.
£ million 2024 2023
Earnings for basic and diluted earnings per share 219.6 349.0
Adjust for exceptional items (Note 4) 98.2 -
Adjust for tax on exceptional items (Note 6) (20.2) -
Earnings for adjusted basic and adjusted diluted earnings per share 297.6 349.0
8. Deferred tax
£ million Share- based payments Capital allowances Temporary differences on overseas provisions Retirement benefit obligations Losses and other Total
temporary
differences
At 1 January 2023 0.6 2.8 6.0 8.6 8.0 26.0
Credit/(charge) to income 0.2 (0.8) (0.6) (0.7) (1.5) (3.4)
Charge to other comprehensive income - - - (0.2) - (0.2)
Credit to statement of changes in equity 1.1 - - - - 1.1
Foreign exchange - - (0.1) - - (0.1)
At 31 December 2023 1.9 2.0 5.3 7.7 6.5 23.4
(Charge)/credit to income (0.2) (2.3) (0.6) (0.9) 2.3 (1.7)
Charge to other comprehensive income - - - (0.4) - (0.4)
Charge to statement of changes in equity (0.4) - - - - (0.4)
Foreign exchange - - (0.3) - - (0.3)
At 31 December 2024 1.3 (0.3) 4.4 6.4 8.8 20.6
Closing deferred tax on temporary differences has been calculated at the tax
rates that are expected to apply for the period when the asset is realised or
liability is settled. Accordingly, deferred tax on UK temporary differences
has been calculated at 29% (31 December 2023: 29%). Deferred tax on Spanish
temporary differences has been calculated at 25% (31 December 2023: 25%).
Notes to the Condensed Consolidated Financial Statements (continued)
8. Deferred tax (continued)
The net deferred tax balance is analysed into assets and liabilities as
follows:
£ million 2024 2023
Deferred tax assets 21.6 25.0
Deferred tax liabilities (1.0) (1.6)
20.6 23.4
The Group has not recognised temporary differences relating to tax losses
carried forward and other temporary differences amounting to £15.9 million
(2023: £2.0 million) in the UK and £18.4 million (2023: £19.4 million) in
Spain. The UK and Spanish temporary differences have not been recognised as
insufficient certainty exists as to their future utilisation.
At the balance sheet date, the Group has unused UK capital losses of £269.7
million (2023: £269.7 million). No deferred tax asset has been recognised in
respect of the capital losses at 31 December 2024 (2023: £nil) because the
Group does not believe that it is probable that these capital losses will be
utilised in the foreseeable future.
9. Inventories
£ million 2024 2023
Land 3,387.5 3,269.5
Development and construction costs 1,949.3 1,871.0
Part exchange and other 39.8 29.1
5,376.6 5,169.6
The markets in our core geographies, which are the primary drivers of our
business, continue to trade positively. At 31 December 2024, the Group
completed a net realisable value assessment of inventory, considering each
site individually and based on estimates of sales price, costs to complete and
costs to sell. At 31 December 2024, the provision held in the United Kingdom
was £25.1 million (2023: £26.5 million) and £28.0 million in Spain (2023:
£32.4 million).
The table below details the movements on the inventory provision recorded in
the year.
£ million 2024 2023
1 January 58.9 51.5
Net (utilised)/additions (4.2) 8.0
Foreign exchange (1.6) (0.6)
31 December 53.1 58.9
Notes to the Condensed Consolidated Financial Statements (continued)
10. Retirement benefit obligations
Total retirement benefit obligations of £22.2 million (2023: £26.5 million)
comprise a defined benefit pension liability of £22.0 million (2023: £26.3
million) and a post-retirement healthcare liability of £0.2 million (2023:
£0.2 million).
Defined benefit pension scheme
The Group's defined benefit pension scheme in the UK is the TWPS. The TWPS is
a funded defined benefit pension scheme which provides benefits to
beneficiaries in the form of a guaranteed level of pension payable for life.
The level of benefits provided depends on an individual member's length of
service and their salary in the final years leading up to retirement or date
of ceasing active accrual if earlier. Pension payments are generally increased
in line with inflation subject to caps specified in the TWPS rules. The TWPS
is closed to new members and future accrual.
The Group operates the TWPS under the UK regulatory framework. Benefits are
paid to members from a Trustee-administered fund and the Trustee is
responsible for ensuring that the TWPS is well managed and that members'
benefits are secure. Scheme assets are held in trust.
The TWPS Trustee's other duties include managing the investment of scheme
assets, administration of scheme benefits and exercising of discretionary
powers. The Group works closely with the Trustee to manage the TWPS. The
Trustee of the TWPS owes fiduciary duties to the TWPS' beneficiaries. The
appointment of the Directors to the Trustee Board is determined by the TWPS
trust documentation.
The most recent triennial valuation of the TWPS was undertaken with a
reference date of 31 December 2022. The result of this valuation was a
Technical Provisions surplus at 31 December 2022 of £55 million. As a result,
no deficit contributions were required to be paid to the TWPS or to the escrow
account established following the 2019 valuation. On an IAS 19 accounting
basis the underlying surplus in the TWPS at 31 December 2024 was £90.2
million (2023: £76.7 million). The terms of the TWPS are such that the Group
does not have an unconditional right to a refund of surplus. As a result, the
Group recognised an adjustment to the underlying surplus in the TWPS on an IAS
19 accounting basis of £112.2 million (2023: £103.0 million), resulting in
an IFRIC 14 deficit of £22.0 million (2023: £26.3 million), which
represented the present value of future contributions under the funding plan.
The TWPS Trustee holds a fixed charge over the escrow account, established
following the 2019 valuation, that is recognised in other financial assets and
at 31 December 2024 held £10.8 million (31 December 2023: £10.3 million),
with interest earned by the escrow account being retained within the escrow
account. Transfers out of the escrow account (either to the TWPS or the Group)
are subject to the 2019 triennial funding arrangement entered into between the
Group and the Trustee and as such the funds are restricted from use by the
Group for other purposes and are therefore not classified as cash or cash
equivalents. The escrow account will be in place until 30 June 2028, at which
point a funding test will be conducted and funds will either be paid to the
TWPS or returned to the Group.
Notes to the Condensed Consolidated Financial Statements (continued)
10. Retirement benefit obligations (continued)
In 2013, the Group introduced a £100.0 million Pension Funding Partnership
(PFP) that utilises the Group's show homes, as well as six offices, in a sale
and leaseback structure. This provides an additional £5.1 million of annual
funding for the TWPS. In March 2024, the Group reached agreement with the
Trustee to restructure the PFP. The restructure retained the existing
contributions payable until 2029 but replaced the payment of up to £100
million that may have been due in 2029, with seven annual payments of up to
£12.5 million each from 2029 to 2035. These are only payable if the TWPS has
a deficit on its Technical Provisions funding basis at the prior 31 December.
The assets held within the PFP do not affect the IAS 19 figures (before IFRIC
14) as they remain assets of the Group, and are not assets of the TWPS. At 31
December 2024, there was £75.1 million of property and £37.6 million of cash
held within the structure (2023: £79.9 million of property and £32.7 million
of cash).
The Group continues to work closely with the Trustee in managing pension
risks, including management of interest rate, inflation and longevity risks.
The TWPS assets are approximately 102% (2023: 98%) hedged against changes in
both interest rates and inflation expectations on the scheme's long term
funding basis that is currently used for investment strategy purposes. The
TWPS also benefits from a bulk annuity contract which covers some of the
largest liabilities in the scheme, providing protection against interest rate,
inflation and longevity risk.
Accounting assumptions:
The assumptions used in calculating the accounting costs and obligations of
the TWPS, as detailed below, are set by the Directors after consultation with
independent actuaries. The basis for these assumptions is prescribed by IAS 19
and they do not reflect the assumptions that may be used in future funding
valuations of the TWPS.
2024 2023
At 31 December
Discount rate for scheme liabilities 5.35% 4.60%
General pay inflation n/a n/a
Deferred pension increases 2.30% 2.15%
Pension increases 1.95%-3.70% 1.90%-3.70%
The table below shows the impact to the present value of scheme liabilities of
movements in key assumptions.
Assumption Change in assumption Impact on Impact on scheme liabilities (%)
scheme liabilities
Discount rate Decrease by 0.5% p.a. Increase by £75m 4.9
Rate of inflation* Increase by 0.5% p.a. Increase by £41m 2.7
Life expectancy Members live 1 year longer Increase by £62m 4.0
* Assumed to affect deferred revaluation and pensioner increases in payment.
Notes to the Condensed Consolidated Financial Statements (continued)
10. Retirement benefit obligations (continued)
The table below details the movements in the TWPS pension liability and assets
recorded through the income statement and other comprehensive income.
£ million Present Fair value Asset/(liability) recognised on balance sheet
value of obligation
of scheme assets
At 1 January 2024 (1,679.8) 1,653.5 (26.3)
Administration expenses - (3.1) (3.1)
Interest (expense)/income (74.7) 73.6 (1.1)
Total amount recognised in income statement (74.7) 70.5 (4.2)
Remeasurement loss on scheme assets - (98.5) (98.5)
Change in demographic assumptions (1.0) - (1.0)
Change in financial assumptions 104.1 - 104.1
Experience gain 1.3 - 1.3
Adjustment to liabilities for IFRIC 14 (4.5) - (4.5)
Total remeasurements in other comprehensive income 99.9 (98.5) 1.4
Employer contributions - 7.1 7.1
Employee contributions - - -
Benefit payments 110.3 (110.3) -
At 31 December 2024 (1,544.3) 1,522.3 (22.0)
£ million Present value of obligation Fair value Asset/(liability) recognised on balance sheet
of scheme assets
At 1 January 2023 (1,675.9) 1,646.3 (29.6)
Administration expenses - (3.3) (3.3)
Interest (expense)/income (80.3) 79.0 (1.3)
Total amount recognised in income statement (80.3) 75.7 (4.6)
Remeasurement gain on scheme assets - 29.7 29.7
Change in demographic assumptions 27.1 - 27.1
Change in financial assumptions (34.9) - (34.9)
Experience loss (29.5) - (29.5)
Adjustment to liabilities for IFRIC 14 8.4 - 8.4
Total remeasurements in other comprehensive income (28.9) 29.7 0.8
Employer contributions - 7.1 7.1
Employee contributions - - -
Benefit payments 105.3 (105.3) -
At 31 December 2023 (1,679.8) 1,653.5 (26.3)
Notes to the Condensed Consolidated Financial Statements (continued)
11. Notes to the cash flow statement
Cash and cash equivalents comprise cash at bank and other short term highly
liquid investments with an original maturity of three months or less.
Movement in net cash
£ million Cash and cash Bank and Total net
equivalents
other loans
cash
Balance at 1 January 2023 952.3 (88.5) 863.8
Net cash flow (185.8) - (185.8)
Foreign exchange (1.6) 1.5 (0.1)
Balance at 31 December 2023 764.9 (87.0) 677.9
Net cash flow (113.5) - (113.5)
Foreign exchange (4.0) 4.4 0.4
Balance at 31 December 2024 647.4 (82.6) 564.8
12. Dividends
£ million 2024 2023
Proposed
Interim dividend 2024: 4.80p (2023: 4.79p) per ordinary share of 1p each 169.9 169.1
Final dividend 2024: 4.66p (2023: 4.79p) per ordinary share of 1p each 165.0 169.4
334.9 338.5
Amounts recognised as distributions to equity holders
Paid
Final dividend 2023: 4.79p (2022: 4.78p) per ordinary share of 1p each 169.5 168.8
Interim dividend 2024: 4.80p (2023: 4.79p) per ordinary share of 1p each 169.9 169.1
339.4 337.9
The Directors recommend a final dividend for the year ended 31 December 2024
of 4.66 pence per share (2023: 4.79 pence per share) subject to shareholder
approval at the Annual General Meeting, with an equivalent final dividend
charge of c.£165 million based on the number of shares in issue at the end of
the year (2023: £169.5 million). The final dividend will be paid on 9 May
2025 to all shareholders registered at the close of business on 28 March 2025.
In accordance with IAS 10 'Events after the Reporting Period', the proposed
final dividend has not been accrued as a liability at 31 December 2024.
Notes to the Condensed Consolidated Financial Statements (continued)
13. Alternative performance measures
The Group uses a number of alternative performance measures (APMs) which are
not defined within UK-adopted international accounting standards. The
Directors use these measures in order to assess the underlying operational
performance of the Group and, as such, these measures should be considered
alongside the statutory measures. The following APMs are referred to
throughout the year end results.
Profit before taxation and exceptional items and profit for the period before
exceptional items
The Directors consider the removal of exceptional items from the reported
results provides more clarity on the performance of the Group. They are
reconciled to profit before tax and profit for the period on the face of the
Consolidated Income Statement.
Operating profit and operating profit margin
Throughout the statement, operating profit is used as one of the main measures
of performance. Operating profit is defined as profit on ordinary activities
before financing, exceptional items and tax, after share of results of joint
ventures. The Directors consider this to be an important measure of the
underlying performance of the Group. Operating profit margin is calculated as
operating profit divided by total revenue.
2024 2023
Profit on ordinary activities before financing (£m) 333.9 467.8
Adjusted for:
Share of results of joint ventures (£m) (15.9) 2.4
Exceptional items (£m) 98.2 -
Operating profit (£m) 416.2 470.2
Revenue (£m) 3,401.2 3,514.5
Operating profit margin 12.2% 13.4%
Net operating assets
Net operating assets is defined as basic net assets less net cash, excluding
net taxation balances and accrued dividends. Average net operating assets is
the average of the opening and closing net operating assets of the 12 month
period. With return on net operating assets, the Directors consider this to be
an important measure of the underlying operating efficiency and performance of
the Group.
2024 2023 2022
Basic net assets (£m) 4,405.2 4,523.4 4,502.1
Adjusted for:
Cash (£m) (647.4) (764.9) (952.3)
Borrowings (£m) 82.6 87.0 88.5
Net taxation (£m) (23.4) (21.8) (18.8)
Accrued dividends (£m) - - -
Net operating assets (£m) 3,817.0 3,823.7 3,619.5
Average basic net assets (£m) 4,464.3 4,512.8
Average net operating assets (£m) 3,820.4 3,721.6
Return on net operating assets
Return on net operating assets is defined as rolling 12-month operating profit
divided by the average of opening and closing net operating assets. The
Directors consider this to be an important measure of the underlying operating
efficiency and performance of the Group.
2024 2023
Operating profit (£m) 416.2 470.2
Average net operating assets (£m) 3,820.4 3,721.6
Return on net operating assets 10.9% 12.6%
Notes to the Condensed Consolidated Financial Statements (continued)
13. Alternative performance measures (continued)
Net operating asset turn
This is defined as 12 month rolling total revenue divided by the average of
opening and closing net operating assets. The Directors consider this to be a
good indicator of how efficiently the Group is utilising its assets to
generate value for shareholders.
2024 2023
Revenue (£m) 3,401.2 3,514.5
Average net operating assets (£m) 3,820.4 3,721.6
Net operating asset turn 0.89 0.94
Tangible net assets per share
This is calculated as net assets before any accrued dividends, excluding
intangible assets, divided by the number of ordinary shares in issue at the
end of the period. The Directors consider this to be a good measure of the
value intrinsic within each ordinary share.
2024 2023
Basic net assets (£m) 4,405.2 4,523.4
Adjusted for:
Intangible assets (£m) (1.5) (2.6)
Tangible net assets (£m) 4,403.7 4,520.8
Ordinary shares in issue (millions) 3,557.0 3,557.0
Tangible net assets per share (pence) 123.8 127.1
Net cash
Net cash is defined as cash and cash equivalents less total borrowings. This
is considered by the Directors to be the best indicator of the financing
position of the Group. This is reconciled in Note 11.
Cash conversion
This is defined as cash generated from operations, which excludes payments
relating to exceptional charges, divided by operating profit on a rolling 12
month basis. The Directors consider this measure to be a good indication of
how efficiently the Group is turning profit into cash.
2024 2023
Cash generated from operations (£m) 311.7 288.9
Operating profit (£m) 416.2 470.2
Cash conversion 74.9% 61.4%
Adjusted gearing
This is defined as adjusted net debt divided by basic net assets. The
Directors consider this to be a more representative measure of the Group's
gearing levels. Adjusted net debt is defined as net cash less land creditors.
2024 2023
Cash (£m) 647.4 764.9
Loans (£m) (82.6) (87.0)
Net cash (£m) 564.8 677.9
Land creditors (£m) (627.9) (516.1)
Adjusted net debt (£m) (63.1) 161.8
Basic net assets (£m) 4,405.2 4,523.4
Adjusted gearing 1.4% (3.6)%
Adjusted basic and diluted earnings per share
This is calculated as earnings attributed to the shareholders, excluding
exceptional items and tax on exceptional items, divided by the weighted
average number of shares in issue during the period. The Directors consider
this provides an important measure of the underlying earnings capacity of the
Group. Note 7 shows a reconciliation from basic and diluted earnings per share
to adjusted basic and diluted earnings per share.
Notes to the Condensed Consolidated Financial Statements (continued)
14. Post balance sheet events
There were no material subsequent events affecting the Group after 31 December
2024.
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