Results round-up

In the half-year period to 2 July, pre-tax profit fell to £205m from £268.8m in the first half of last year as the group recorded a £130m provision as an exceptional item to provide redress to customers who were sold leasehold properties where the ground rent doubles every 10 years.

Revenue rose 18.5% to £1.7bn and the company completed a total of 6,580 homes, excluding joint ventures, up 9.3% on the year before.

Total average selling prices rose 6.3% to £253,000, excluding joint ventures, but were lower than in the second half of last year.

However build costs were seen increasing, up 3-4% over the last year, mainly driven by labour costs, and are expected to continue on this trend for the remainder of the year.

Taylor Wimpey said its target to return £1.3bn in dividends over 2016-18 will be achieved, as it announced a special dividend of £340m, or around 10.4p per share, to be paid in July 2018.

Chief executive Pete Redfern said: "Trading through the first half of 2017 has been very positive, supported by favourable UK housing market fundamentals and good customer confidence. In the central London market in particular, we are pleased to see improved customer confidence following a period of uncertainty.

“Although the wider political backdrop could have an impact on confidence levels and market dynamics, we have seen no material change in trading since the General Election, and our first half performance has been strong.

"Our business is built to maximise performance in all market conditions, benefiting from a robust balance sheet and high-quality landbank. With a strong forward order book and a disciplined strategy to manage the business through the cycle, we remain on track to meet both our full year objectives and medium term strategic goals.”

TWY shares rose 1% to 192.3p on Tuesday by just after midday.

Analyst Laith Khalaf at Hargreaves Lansdown said the cost of tackling the punitive leasehold issue, covering houses sold between 2007 and 2011, loomed large over this set of results, however the trading environment still looks very positive.

"Taylor Wimpey is selling more houses at higher prices, and quite simply that is driving profits and returns to shareholders. To that end the housebuilder has announced a further special dividend coming next year in a show of continued confidence."

BP moved back into the black during the second quarter of 2017 thanks to an improved performance in its upstream arm with the firm having lowered its cash break-even level to $47 per barrel of oil.

The oil major swung from a replacement cost loss of -$2.25bn one year ago to a profit of $553m over the three months to June.

Within that, replacement cost profits at its upstream division reached $710.0m, versus just $29.0m seen in the same period of 2016.

However, on an underlying basis, after tax RC profits in fact fell, from $720.0m in the year-ago quarter to $684.0m as the company's interest rate burden and tax payments increased - especially the latter.

In the company's results statement, management opted to highlight the production growth of 6% seen in the first six months of 2017, alongside a reduction of 18% in its unit operating costs.

As well, during the first half of 2017 BP was cash break-even at $47 per barrel of oil, finance chief Brian Gilvary emphasised in remarks to Bloomberg.

Net debt at period-end stood at $39.8bn, up from $30.9bn one year back, for an increase in its ratio of net debt from 24.7% to 28.8%.

According to Gilvary, payments linked to the 2010 Gulf of Mexico oil spill disaster were the main cause of the increased debt.

Yet the company's debt pile was expected to reduce in the second half of 2017 as the associated compensation payments slowed down and proceeds from its divestment plan began to flow in.

BP also said it was on track to increase its output of oil by 800,000 barrels a day by 2020, with three new projects having already come online during 2017.

Operating cash flows at BP, excluding the impact of the Gulf of Mexico oil spill, was at $6.9bn at quarter-end, up from $5.3bn.

Including the related post-tax amounts cash flows were at $4.9bn, versus $3.9bn a year-ago.

The quarterly dividend per share was kept at $0.10.

"Fortunately the group’s Upstream division has delivered a strong set of numbers this time out, and while the Downstream refining business hasn’t delivered the growth we’ve seen from the likes of Shell, it remains robustly profitable. Gulf of Mexico costs are expected to fall from here, but BP remains a bit of a waiting game," said Laith Khalaf, senior analyst at Hargreaves Lansdown.