Housebuilders says it will to talk to more lenders about securing a refinancing deal as it reveals 拢19.6m half-year profit
Housebuilder Taylor Wimpey is to talk to other banks to secure a refinancing deal to allow it to grow in the current market, it said today.
Publishing half year results showing pre-tax profits of 拢19.6m on revenue up 8% to 拢1.22bn, the firm said it was planning to widen its current refinancing discussions to 鈥渙ther lender groups鈥� in the coming months.
Taylor Wimpey is widely viewed as the housebuilder with the most restrictions on its ability to invest in land and other assets for the future because of the nature of its agreements with its main banking group. It said today that 鈥渨hile the group鈥檚 current debt facilities do not expire until July 2012, an earlier refinancing is preferable to provide additional operational flexibility for the business.鈥�
It added: 鈥淲e have had good early discussions with our main banking group and expect to widen the discussions to other lender groups in the coming months.鈥�
The comments are the firm鈥檚 first public statements on the subject since it was reported it was looking to refinance in July. The comments came as it reported an overall profit of 拢7.5m for the six months to July 4, compared to a 拢682m loss in the same period last year. The number of homes sold rose marginally, to 6,730, up from 6,707, with build cost reductions of 9% from the market peak.
First half results were surprisingly strong
Charlie Campbell, analyst
The markets reacted well to the announcement, sending shares up 4% in early trading. However, the firm said the number of sites it has open in the UK declined from 322 to 295, and land acquisitions in the UK remained 鈥渟elective鈥�.
The firm said it 鈥渞emained concerned about the potential adverse impacts of proposed changes in planning policy,鈥� and noted 鈥渨ider economic uncertainty鈥� in the UK.
Pete Redfern, group chief executive, said: 鈥淲e have performed well in the first half of the year and I鈥檓 pleased with the progress we鈥檝e made in reducing costs, improving the margin and developing the landbank. We have significantly strengthened our business and we are well-positioned to grow shareholder value.鈥�
Analyst Charlie Campbell, of Liberum Capital, said: 鈥淸The] first half results were surprisingly strong, making 拢20m profit before tax against expected loss of 拢16m, driven by much better than expected UK margin. Its outlook statement鈥� bodes well for the UK housebuilders鈥� results season.鈥�
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