Crest Nicholson raises outlook on higher prices

UK house builder Crest Nicholson on Tuesday raised its full-year outlook, despite swinging to an interim loss due to an exceptional charge and said it expected to counter cost inflation with higher selling prices.

The company said it expected full-year adjusted pre-tax profit to be £135m - £140m, compared with £45.9m a year before.

"Despite the unpredictable global, economic and political outlook, we remain optimistic about the fundamentals of the UK housing market," said chief executive Peter Truscott.

Pre-tax losses for the six months ended to April 30, were £52.5m compared with a profit of £36.3m, due to an exceptional pre-tax charge of £105m, including obligations related to the UK government's Building Safety Pledge.

Revenue was up 12% to £364.3m and an interim dividend of 5.5p a share was declared.

Completions rose to 1,096, from 1,017 year on year while forward sales secured at June 10 stood were £814.9m from £692m the year before.

“The group has performed well in the first half, in line with our expectations. Customer demand for our homes is strong across all regions reflecting the continued strength of the UK housing market,” the company said.

It added that demand was still strong from buyers seeking bigger properties as more people adopted a hybrid of working from home and the office, driven by the Covid pandemic.

“We continue to see this rationale being cited by customers in their reasons for moving home,” Crest Nicholson said.

“No one in the construction sector is immune from the current impacts of input cost inflation. However, we are managing to successfully offset this with sales price inflation in a market with strong demand and relatively poor levels of supply.”