Crest Nicholson ups profit outlook on booming homebuyer demand

Housebuilder Crest Nicholson has hiked its full-year profit outlook after surging sales and said demand is set to hold up after the stamp duty holiday ends.

The group swung to a pre-tax profit of £36.3 million for the six months to April 30 from losses of £51.2 million a year ago as home completions soared 31% to 1,017.

On an underlying basis, interim pre-tax profits jumped to £36.1 million from £4.5 million a year earlier.

It now expects full-year underlying pre-tax profits of at least £100 million thanks to the strong first half and its confidence in the outlook even after the stamp duty holiday ends at the end of June, tapered to September 30.

The group said forward sales stood at 2,771 as at June 18, up slightly on the 2,715 seen a year earlier.

Shares in Crest lifted 3% after the figures.

It said: “Consumer confidence in the stability of the housing market, coupled with changing working patterns and lifestyle choices, have underpinned demand and meant both sales rates and prices have exceeded the pre-pandemic level.

“Based on demand for homes which will complete after the September 30 2021 stamp duty deadline, we are confident that the housing market will remain robust and this transition can be managed smoothly.”

The results come in stark contrast to a year earlier, when the group had plunged to a half-year loss and announced an overhaul, including plans to axe 13% of its workforce.

Peter Truscott, chief executive of Crest, said the turnaround of the group was bearing fruit and outlined plans to begin expanding into new locations.

While the group is not set to reveal details of expansion plans until later in the year, it is expected to look at neighbouring counties to its current operations across the south of England.

Mr Truscott said: “Having completed the first part of our turnaround strategy, and implemented our operational efficiency programme, our focus now moves to rebuilding operating margins and delivering sustainable growth.

“We are evaluating options to enter new geographical markets and look forward to outlining these future growth plans and our long-term financial targets later this year.”