Housebuilder pledges to focus more on private sales as it trades out of ‘low margin’ sites
Crest Nicholson has said its annual profit will be at the lower end of its expectations, as its chief executive pledged a “year of transition” in 2025 to focus more on private sales.
The housebuilder, in an update this morning for the year to 31 October, said its adjusted pre-tax profit will be towards the bottom of its previously expected £22m to £29m range.
It said this was due to a higher proportion of affordable homes delivered as well as continuing to “trade out of low margin sites”.
Martyn Clark, chief executive, said next year will be a “year of transition”.
He added:: “We will focus more on private sales and prioritise value over volume to enhance returns and margins.”
He said the company was “well-positioned with sufficient land with full planning permission” to support its planned outlets and volumes.
Clark said the housebuilder’s performance in 2024 has been affected by internal and external factors, with private open market sales volumes hit by “ongoing affordability concerns”.
The housebuilder said it built 1,873 homes in the year to 31 October, of which 45% are for affordable tenures or the private rented sector.
It said its open market sales rate was 0.48 sales per outlet per week. This was down on the 0.52 posted for the previous year, although Crest Nicholson said the rate had picked up to 0.53 in the last 10 weeks of the year.
Crest Nicholson also said it invested “selectively” in appropriate scaled sites, adding 1,158 plots to its pipeline. It also said its new centralised specialist building safety team has “made good progress” on fire remediation.
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Clark, who took over as chief executive in January following a profit slump, said: “As we execute on many of the near term operational improvements, we will also look to further strengthen the business for the future, where we will focus on three areas in particular: optimising value from our high-quality land portfolio; building homes of exceptional quality efficiently; and, delivering outstanding service to customers.”
The group’s preliminary results are due to be published on 21 January next year.
The update comes three months after larger rival Bellway announced it was abandoning its plan to take over £900m Crest Nicholson. A spokesperson for Crest Nicholson at the time said it “remains confident in its standalone prospects”.
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