Taylor Wimpey Plc · LSE:TW.
Taylor Wimpey — H1 2018 Earnings Presentation
87 slides from Taylor Wimpey's earnings presentation, Jul 31, 2018
Slide 1: Half Year Results Presentation
Half Year Results Presentation for the half year ended 1 July 2018 31 July 2018
Slide 2: Disclaimer
Disclaimer This presentation is not intended to, and does not constitute or form part of, any offer, invitation or the solicitation of an offer to purchase, otherwise acquire, subscribe for, sell or otherwise dispose of, any securities in Taylor Wimpey plc or any other invitation or inducement to en
Slide 3: Agenda
Agenda Operating performance, current trading and outlook Pete Redfern Financial performance Chris Carney Business improvement and strategic goals Pete Redfern 3
Slide 4: Operating performance, current trading and outlook
Operating performance, current trading and outlook Pete Redfern Chief Executive
Slide 5: Financial highlights
Financial highlights Return on net Cash Operating operating assets* conversion* profit* margin 30.9% 86% 20.0% (H1 2017: 30.9%) (H1 2017: 104%) (H1 2017: 20.3%) Profit before tax Basic earnings and exceptional Net cash items per share £331m 7.5p £525.1m (H1 2017: £335m) (H1 2017: 5.1p) (H1 2017: £42
Slide 6: Operating highlights
Operating highlights Customer and 8 week ‘Would you recommend’ 90.3% communities 9 month ‘Would you recommend’ 78.5% Land cost as a % of ASP on approvals 17.1% Land and planning Potential revenue in landbank increased to £48 bn Construction Quality Review – sites rated good or Production and better
Slide 7: Customers and communities
Customers and communities ▪ Improvement in ‘Would you Recommend’ scores to 90% (H1 2017: 88%) 5 star level for first half ▪ Improvement in accuracy of move in dates – 83% of customers move in ‘within window’ or earlier Customer care costs £m H1 2018 H2 2017 H1 2017 Overheads 10.9 11.2 11.4 Remediati
Slide 8: Customer service
Customer service YTD scores for the ‘Recommend’ question 8 week survey 2018 YTD average 2017 YTD average Taylor Wimpey UK Ltd 90.3% 88.3% North 90.1% 90.1% Central and South West 90.1% 85.6% London and South East 91.1% 88.2% Customers moved in Customers moved in 9 month scores* Oct 16-Sep 17 Oct 15-
Slide 9: Site based ROCE
Quality of land acquisitions 42.0% 40.0% 38.0% 36.0% Site based ROCE* 34.0% 32.0% 30.0% 28.0% 26.0% 24.0% 23.0% 24.0% 25.0% 26.0% 27.0% 28.0% 29.0% Contribution margin* 2013 2014 2015 2016 2017 H1 2018 At current costs and current selling prices in year of acquisition * See definitions slide in the
Slide 10: UK landbank
UK landbank ▪ Land cost in short term owned landbank is 14.6% of ASP (H1 2017: 15.1%), supported by strategic pipeline conversions ▪ Land cost as % of ASP on H1 2018 approvals – 17.1% ▪ Potential revenue in the landbank at 1 July 2018 was £48 billion (2 July 2017: £43 billion), comprising short term
Slide 11: Production
Production ▪ Focus over the last three years has been on: ▪ Quality, particularly finish quality ▪ Accuracy and predictability of delivery timings ▪ Absolute commitment to maintaining these improvements, but with a renewed focus on: ▪ Underlying ‘right first time’ construction quality ▪ Cost efficie
Slide 12: NHBC Pride in the Job awards
NHBC Pride in the Job awards ▪ Taylor Wimpey winners of ‘Pride in the Job’ awards 70 60 50 40 30 20 10 0 2015 2016 2017 2018* Quality Awards Seal of Excellence Regional * 2018 Seal of Excellence and Regional winners to be announced later in the year 12
Slide 13: People and culture
People and culture ▪ Staff survey – 94% of employees agree / strongly agree that Taylor Wimpey is committed to becoming an inclusive organisation with a diverse workforce ▪ Number 15 in the top 20 places to work in the UK, by Glassdoor, as voted for by employees, the only private housebuilder to mak
Slide 14: H1 2018 market backdrop
H1 2018 market backdrop ▪ Consumer confidence has been affected by Brexit uncertainty ▪ However new housebuilding sales and build rates have remained very positive ▪ HTB remains a key factor, as do continuing low interest rates ▪ Mortgage availability remains good January July February July 2-year f
Slide 15: UK market performance – to date
UK market performance – to date H2 2018 (w/e 22 July 2018) H1 2018 H2 2017 H1 2017 H2 2016 H1 2016 Average outlets open 275 280 284 292 286 294 Private sales rate (net) 0.68 0.83 0.66 0.87 0.65 0.78 Private sales price 288 296 287 289 279 271 £000 Cancellation rate 15% 13% 15% 11% 14% 12% (private)
Slide 16: Central London market performance
Central London market performance H1 2018 H2 2017 H1 2017 H2 2016 H1 2016 Average outlets open 8 8 8 8 9 Private sales rate (net) 0.47 0.24 0.41 0.42 0.29 Private sales price £000 896 962 1,147 863 1,011 Cancellation rate (private) 12% 26% 18% 14% 24% ▪ Mount Pleasant ▪ Progress is in line with our
Slide 17: 2018 UK market performance - lead indicators
2018 UK market performance - lead indicators Customer interest – organic website visits Website calls 150,000 10,000 120,000 8,000 90,000 6,000 60,000 4,000 30,000 2,000 0 0 1 4 7 10 13 16 19 22 25 28 31 34 37 40 43 46 49 52 1 4 7 10 13 16 19 22 25 28 31 34 37 40 43 46 49 52 Week number Week number
Slide 18: Sales rates and landbank efficiency
Sales rates and landbank efficiency Sites with an open outlet H1 2018 in period Sales rate per site Super large (751+) 22 1.53 Large (376-750) 33 1.14 Medium (201-375) 76 0.91 Small (1-200) 131 0.71 Total 262 0.89 ▪ Just a snapshot to show how sales rates are progressing, particularly on larger site
Slide 19: Net private sales by price band
Net private sales by price band Net private £201k- £251k - £301k - £451k- £601k - sales <£200k £250k £300k £450k £600k £1m >£1m Total North 999 769 613 421 28 5 - 2,835 Central and South West 329 366 413 787 123 13 - 2,031 London and South East 36 123 155 493 243 123 33 1,206 Total 1,364 1,258 1,181
Slide 20: Outlook
Outlook ▪ Employment prospects, mortgage availability and affordability all good by historic standards ▪ Help to Buy remains important differentiator in new build ▪ Base case still low house price growth overall – scale of future interest rate changes important ▪ Build pressures manageable ▪ Reduced
Slide 21: Financial performance
Financial performance Chris Carney Group Finance Director
Slide 22: Summary Group results
Summary Group results £m (before exceptional items) H1 2018 H1 2017 Change FY 2017 Revenue 1,719.8 1,727.5 (0.4)% 3,965.2 Gross profit 445.0 443.7 0.3% 1,031.8 Gross profit margin % 25.9 25.7 0.2ppt 26.0 Operating profit* 344.3 350.5 (1.8)% 844.1 Operating profit* margin % 20.0 20.3 (0.3)ppt 21.3 Pr
Slide 23: UK performance summary
UK performance summary H1 2018 H1 2017 Change FY 2017 Legal completions – excl JVs 6,367 6,580 (3.2)% 14,387 Private 4,854 5,219 (7.0)% 11,602 Affordable 1,513 1,361 11.2% 2,785 Average selling price – excl JVs 257 253 1.6% 264 Private £000 295 287 2.8% 296 Affordable £000 135 123 9.8% 131 Legal com
Slide 24: Indicative movements in UK operating profit margin
Indicative movements in UK operating profit* margin Annual Impact on H1 2018 H1 2017 to H1 2018 change income statement Market inflation on selling prices c.3.0%** 1.8% Market inflation on build cost c.3.5% (1.8)% Net economic benefit captured 0.0% Market impact of landbank evolution (0.1)% Net mark
Slide 25: Cost and efficiency programme update
Cost and efficiency programme update ▪ No burning platform, and not much in the way of easy wins, but there are clear opportunities to improve productivity and procurement efficiency ▪ Strong underlying IT systems with the potential to support and drive efficiency with improved data analysis ▪ Addre
Slide 26: Systems and efficiency
Systems and efficiency Why / opportunity Results / benefits Progress Delivery Excellence Significant inefficient paper-based Improvement in production build Pilot completed, roll admin processes on site. Mobile quality and efficiency together out imminent. devices and apps solutions piloted with a r
Slide 27: UK margin drivers and build cost
UK margin drivers and build cost £000 per unit H1 2014 H1 2015 H1 2016 H1 2017 H1 2018 ASP 205.6 224.5 237.8 253.1 257.1 Net land cost* (44.1) (41.3) (40.3) (43.7) (40.6) Build cost (109.3) (118.9) (131.0) (137.4) (143.7) Other direct cost and selling expenses (6.9) (8.4) (6.8) (6.5) (6.2) Private a
Slide 28: Exceptional item – ACM cladding
Exceptional item – ACM cladding ▪ Completed a review to identify all legacy and current buildings with Aluminium Composite Material (ACM) cladding ▪ We have followed the MHCLG advice relating to interim mitigation measures for buildings with ACM cladding and obtained professional advice from fire sa
Slide 29: Summary Group balance sheet
Summary Group balance sheet Group £m 1 July 2018 2 July 2017 Change 31 Dec 2017 Long term assets and JVs 124.8 81.0 54.1% 77.6 Land 2,746.3 2,593.9 5.9% 2,684.5 WIP 1,537.8 1,461.3 5.2% 1,391.2 Debtors 216.3 230.6 (6.2)% 182.3 Land creditors (668.1) (526.1) 27.0% (639.1) Other creditors (926.7) (901
Slide 30: Cash management
Cash management UK metrics H1 2015 H2 2015 H1 2016 H2 2016 H1 2017 H2 2017 H1 2018 Completions (excl JVs) 5,842 7,377 6,019 7,789 6,580 7,807 6,367 Total sq ft per unit 1,031 1,027 1,033 1,013 1,008 1,018 1,023 ASP £ per sq ft 218 228 230 265 251 269 251 Build cost £ per sq ft (116) (123) (127) (142
Slide 31: Pensions
Pensions ▪ Technical deficit assessed at 31 March was £23 million ▪ Bullet payment to fully fund paid in April 2018 ▪ No further contributions expected in 2018 as payments do not resume until scheme is less than 96% funded ▪ IFRIC 14 deficit of £55 million on balance sheet represents present value o
Slide 32: Dividend payment profile
Dividend payment profile Change Paid (or to be paid) FY 2017 to per share (pence) FY 2019*** FY 2018 FY 2017 FY 2018 Ordinary dividend* c.7.6 4.9 4.6 6.5% Special dividend** c.10.7 10.4 9.2 13.0% Total c.18.3 15.3 13.8 10.9% Change Paid (or to be paid) FY 2017 to (£m) FY 2019*** FY 2018 FY 2017 FY 2
Slide 33: Summary
Summary ▪ Key priorities: ▪ Driving business improvement through application of technology ▪ Reducing inefficiency in our core processes to drive productivity ▪ Getting the most out of the investment we’ve made in our IT systems 33 33
Slide 34: Business improvement and strategic goals
Business improvement and strategic goals Pete Redfern Chief Executive
Slide 35: Strategy summary
Strategy summary ▪ Long term direction focused on identifying customer needs and aspirations and delivering them in a commercially sound way ▪ Build on existing strategic land assets and skills, and work our land harder in a less constrained land environment ▪ Invest in the build and delivery capaci
Slide 36: From reactive and reactionary to proactive and innovative
From reactive and reactionary to proactive and innovative 2008 2018 2028 36
Slide 37: Strategy implementation - business improvement
Strategy implementation - business improvement Customer and communities Land and planning Production and supply chain People and culture Systems and efficiency 37
Slide 38: Customers and communities
Customers and communities Why / opportunity Results / benefits Progress Enhancements to Focusing on improving the product and 90% ‘Would you Recommend’ score Started in 2016 – customer service service through enhanced structure and in H1 2018 – up from 86% in 2016. investment teams and processes imp
Slide 39: Customers and communities
Customers and communities Why / opportunity Results / benefits Progress Standard house Increased efficiency for site Using post occupancy research and Consolidation type range management teams and subcontractors customer research to improve the completed, being and better design for customers. custo
Slide 40: Land and planning
Land and planning Why / opportunity Results / benefits Progress Advances to Social media trials via Facebook and Results have to date been Ongoing – second wave community Instagram in order to increase our reach variable dependent upon scheme of trials. engagement within communities and modernise ou
Slide 41: Outlet openings – a zero sum choice?
Outlet openings – a zero sum choice? QUALITY PACE 41
Slide 42: Production and supply chain
Production and supply chain Why / opportunity Results / benefits Progress Consistent quality Framework to define consistent Collaboration between production Implemented in 2018. approach finishing standard shared with and customer service to ensure that subcontractors. local teams recognise and main
Slide 43: Production and supply chain
Production and supply chain Why / opportunity Results / benefits Progress Timber frame project Reducing reliance on masonry 20% target by 2020. Consolidated build / materials, decreasing build standard house type time. range conversion complete and on target. Direct labour Investing in recruiting an
Slide 44: Production – Project 2020
Production — Project 2020 44 Taylor | ple Wimpey
Slide 45: People and culture
People and culture Why / opportunity Results / benefits Progress Culture development Evolve a highly engaged workforce Brings into focus the way we Regional focus groups to ensure we create a business collaborate and innovate. underway – environment which is sustainable Culturally adapting in line w
Slide 46: People and culture continued
People and culture continued Why / opportunity Results / benefits Progress Leadership programmes Provision of leadership Ensuring alignment of values in ‘how’ Continued development from a first time line we lead the business. commitment to manager to senior leader – Develops business breadth beyond
Slide 47: Medium and long term goals
Medium and long term goals ▪ Building a business that is more connected with its customers and communities than any currently in the sector ▪ Creating a long term growth platform that is more agile and responsive to a fundamentally attractive market ▪ Reducing risk and becoming more resilient to cha
Slide 48: Political environment
Political environment ▪ Political focus has been distracted by the Government debates over Brexit ▪ Probably delayed a HTB decision, although we do expect this in H2 ▪ Letwin Review timeline has not particularly been affected ▪ Delayed changes to NPPF which have now been finalised ▪ Output of analys
Slide 49: Summary
Summary ▪ Investments made in customer service and to key processes starting to pay off ▪ Focused on improving every aspect of the business, with customer focus as a catalyst ▪ Taking a more proactive approach – becoming more challenging and innovative ▪ Strategic goal is to create a business with t
Slide 50: Taylor Wimpey
50 Wimpey | ple
Slide 51: Future investor communications
Future investor communications ▪ 13 November 2018 Trading update ▪ 9 January 2019 Trading update ▪ 27 February 2019 Full year results 2018 51
Slide 52: Appendices
Taylor Wimpey plc Half Year Results Presentation for the half year ended 1 July 2018 Appendices
Slide 53: Summary income statement
Summary income statement* Group £m H1 2018 H1 2017 Change FY 2017 Revenue 1,719.8 1,727.5 (0.4)% 3,965.2 Cost of sales (1,274.8) (1,283.8) (0.7)% (2,933.4) Gross profit 445.0 443.7 0.3% 1,031.8 Net operating expenses (98.6) (97.6) 1.0% (195.3) Profit on ordinary activities 346.4 346.1 0.1% 836.5 bef
Slide 54: Summary of impact of IFRS on H1 2018
Summary of impact of IFRS 16 on H1 2018 ▪ The Group has chosen to early adopt IFRS 16 ‘Leases’ from 1 January 2018. ▪ IFRS 16 requires the value of all assets held under lease agreements across the Group to be capitalised and an associated lease liability recognised which is equal to the present val
Slide 55: Summary of impact of restatements H1 2017
Summary of impact of restatements H1 2017 ▪ The impact of the accounting standards adopted in 2018 on the Group’s H1 2017 income statement* and key metrics is as follows: IFRS 9 IFRS 15 Group £m Published impact impact Restated Revenue 1,727.5 - - 1,727.5 Cost of sales (1,283.5) (0.3) - (1,283.8) Gr
Slide 56: Summary of impact of restatements December 2017
Summary of impact of restatements 31 December 2017 ▪ The impact of the accounting standards adopted in 2018 on the Group’s 31 December 2017 income statement* and key metrics is as follows: IFRS 9 IFRS 15 Group £m Published impact impact Restated Revenue 3,965.2 - - 3,965.2 Cost of sales (2,932.2) (1
Slide 57: Cash flow summary
Cash flow summary Group £m H1 2018 FY 2017 H2 2017 H1 2017 Profit from ordinary activities before finance costs* 316.4 706.5 490.4 216.1 (Increase) / decrease in inventories (187.0) (61.7) 75.5 (137.2) Exceptional items 30.0 130.0 - 130.0 Other operating items** 35.6 (38.9) (36.2) (2.7) Cash generat
Slide 58: Group segmental analysis
Group segmental analysis H1 2018 H1 2017 FY 2017 Operating Operating Operating Operating profit* Operating profit* Operating profit* profit* margin RONOA* profit* margin RONOA* profit* margin RONOA* £m % % £m % % £m % % North 133.4 20.9 33.8 144.8 22.8 34.3 294.9 22.1 35.6 Central and South 150.3 25
Slide 59: North Division – segmental analysis
North Division – segmental analysis Scotland, North West North North North Yorkshire and Division Division As at 1 July 2018 and North East Yorkshire Midlands H1 2018 FY 2017 Number of outlets 56 44 43 143 143 Private sales rate (net) 0.76 0.83 0.69 0.76 0.72 Completions 1,119 923 842 2,884 6,076 Av
Slide 60: Central and South West Division – segmental analysis
Central and South West Division – segmental analysis Central and Central and South West South West East and Wales and Division Division As at 1 July 2018 Central West H1 2018 FY 2017 Number of outlets 46 31 77 83 Private sales rate (net) 0.94 1.04 0.99 0.87 Completions 1,304 1,032 2,336 5,135 Averag
Slide 61: London and South East Division – segmental analysis
London and South East Division – segmental analysis London and London and South East South East South East excl. London Division Division As at 1 July 2018 London market† market† H1 2018 FY 2017 Number of outlets 40 18 58 52 Private sales rate (net) 0.75 0.90 0.80 0.77 Completions 836 311 1,147 3,17
Slide 62: Tax
Tax Current tax Deferred tax Net tax Asset / (liability) £m £m £m As at 1 January 2018 (57.9) 29.3 (28.6) Income statement* (54.9) (1.6) (56.5) SOCI / SOCIE 0.7 3.4 4.1 Cash paid 64.1 - 64.1 As at 1 July 2018 (48.0) 31.1 (16.9) ▪ Pre-exceptional underlying tax rate of 18.7% (H1 2017: 19.1%) ▪ Expect
Slide 63: Managing UK working capital
Managing UK working capital WIP cash spend vs P&L charge 2,500 70% 60% 2,000 50% 1,500 40% £m 1,000 30% 20% 500 10% 0 0% H2 15 H1 16 H2 16 H1 17 H2 17 H1 18 Development & construction costs in WIP P&L charge (direct build costs) in previous 12 months Cash spend in previous 12 months % of next 12 mon
Slide 64: Movement in Group net assets
Movement in Group net assets H1 2018 rolling H1 2017 rolling Breakdown of 12 months 12 months movement £m £m % Opening net assets 2,778.9 2,592.2 N/A Pre-exceptional net earnings 658.3 647.5 23.7% Net impact of exceptional items (24.2) (107.6) (0.9)% Actuarial gains after tax 31.0 30.8 1.1% Net shar
Slide 65: UK net operating assets
UK net operating assets £m 1 July 2018 2 Jul 2017 31 Dec 2017 Fixed assets 54 26 27 Investment in JVs 70 55 51 Land 2,635 2,503 2,596 WIP 1,478 1,401 1,337 Total inventories 4,113 3,904 3,933 Debtors 214 228 180 Land creditors (641) (501) (618) Other creditors (845) (832) (750) Total creditors (1,48
Slide 66: Financing
Financing ▪ Net cash at 1 July 2018: £525.1m (31 Dec 2017: £511.8m, 2 July 2017: £429.0m) ▪ Adjusted gearing* (net debt plus land creditors): 4.8% (31 Dec 2017: 4.1%, 2 July 2017: 3.5%) ▪ Average net cash: £360.6m (2017: £186.5m, 2 July 2017: £223.8m) ▪ Borrowings and facilities: ▪ Fully undrawn £55
Slide 67: Finance charges
Finance charges £m H1 2018 H1 2017 Change FY 2017 Financial indebtedness 2.7 2.8 (3.6)% 6.0 Land creditor unwind 9.3 10.0 (7.0)% 20.7 Pensions 0.7 3.1 (77.4)% 5.9 Other 1.6 - - (0.3) Total 14.3 15.9 (10.1)% 32.9 Prior period numbers have been restated to include the impact on adoption of IFRS 9 ‘Fin
Slide 68: Pensions
Pensions Movement in present value of defined benefit obligations Total UK £m H1 2018 FY 2017 FY 2016 FY 2015 IAS 19 (surplus) / deficit brought (23.9) 232.7 177.1 182.4 forward Employer contributions* (33.1) (23.1) (23.1) (23.1) Administration cost 1.5 3.0 3.3 3.2 Interest cost 0.7 5.9 6.1 6.0 Actu
Slide 69: UK land commitments
UK land commitments As at 1 As at 31 July Dec £m < 1 yr 1-2 yrs 2-5 yrs 5+ yrs 2018 2017 Committed cash payments in respect of unconditional 345 149 149 31 674 650 land contracts Expected cash payments in respect of conditional land 53 63 51 87 254 337 contracts ▪ Included in unconditional land cont
Slide 70: UK land portfolio ‒ net cost
UK land portfolio ‒ net cost 1 July 2018 31 Dec 2017 £m Owned Controlled Total Total Detailed planning 1,927 15 1,942 1,884 Outline planning 440 62 502 496 Resolution to grant 17 21 38 42 Sub-total 2,384 98 2,482 2,422 plots 56,828 18,789 75,617 74,849 Strategic 75 76 151 159 plots 25,404 92,722 118
Slide 71: UK short term landbank
UK short term landbank 3,541 (6,377) 80,000 3,822 (218) 74,849 75,617 70,000 Plots 60,000 50,000 31 Dec 2017 Plots acquired Strategic land Completions Land sales Review and 1 July 2018 conversion incl. JVs scope changes Movement in period Data includes JV plots 71
Slide 72: UK strategic pipeline
UK strategic pipeline 3,808 (3,541) 614 120,000 118,126 117,245 Plots 100,000 80,000 31 Dec 2017 Plots acquired Strategic land Land sales Review and 1 July 2018 conversion scope changes Movement in period Excludes land with less than 50% certainty of achieving planning permission Data includes JV pl
Slide 73: UK land pipeline
UK land pipeline 1 July 2018 31 Dec 2017 Plots Owned Controlled Total Total Detailed planning 42,255 2,509 44,764 46,320 Outline planning 12,424 7,433 19,857 19,931 Resolution to grant 2,149 8,847 10,996 8,598 Short term 56,828 18,789 75,617 74,849 Short term with 41,816 - 41,816 42,094 implementabl
Slide 74: UK planning permissions
UK planning permissions Sites with implementable planning 20,000 permission 18,000 95.5% 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 3.0% 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 0.6% 0.9% Permissions gained (rolling 12 months) Completions* (Rolling 12 months) Started on site as a
Slide 75: North Division - land
North Division - land Scotland, North Yorkshire North West North North and North and Division Division As at 1 July 2018 East Yorkshire Midlands H1 2018 FY 2017 Short term owned and controlled land portfolio plots 13,062 8,863 7,850 29,775 27,821 Land portfolio years 5.7 4.9 4.2 5.0 4.6 Cost per plo
Slide 76: Central and South West Division - land
Central and South West Division - land Central and Central and South West South West East and Wales and Division Division As at 1 July 2018 Central West H1 2018 FY 2017 Short term owned and controlled 16,964 15,136 32,100 32,788 land portfolio plots Land portfolio years 6.0 6.2 6.1 6.4 Cost per plot
Slide 77: London and South East Division - land
London and South East Division - land London and London and South East South East South East excl. London Division Division As at 1 July 2018 London market† market† H1 2018 FY 2017 Short term owned and controlled 8,230 5,512 13,742 14,240 land portfolio plots Land portfolio years 4.0 5.8 4.6 4.3 Cos
Slide 78: Land disposals
Land disposals £m H1 2018 H1 2017 FY 2017 Proceeds UK 46.5 23.2 39.0 Spain - 0.6 0.5 Total 46.5 23.8 39.5 Gross profit UK 13.7 8.5 11.0 Spain - (0.3) (0.3) Total 13.7 8.2 10.7 Land disposals are included in revenue and cost of sales 78
Slide 79: Interest rate
FTB mortgage payments as % of pay / interest rates 100% 16.00 90% 14.00 80% 12.00 70% % of take home pay 10.00 Interest rate 60% 50% 8.00 40% 6.00 30% 4.00 20% 2.00 10% 0% - 1983 1984 1986 1988 1990 1991 1993 1995 1997 1998 2000 2002 2004 2005 2007 2009 2011 2012 2014 2016 2018 Interest rate London
Slide 80: Real house prices
80 £0 £50,000 £100,000 £150,000 £200,000 £250,000 1987 1988 1989 1990 1991 1992 1993 1994 1995 Real house prices Source: Nationwide – Nominal house prices 1996 1997 1998 1999 2000 2001 2002 Nominal prices 2003 2004 2005 2006 Real prices 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Slide 81: UK market performance
UK market performance H1 2018 H2 2017 H1 2017 H2 2016 H1 2016 Average outlets open 280 284 292 286 294 Private sales rate (net) 0.83 0.66 0.87 0.65 0.78 Private sales price £000 296 287 289 279 271 Cancellation rate (private) 13% 15% 11% 14% 12% Data based on reservations excluding JVs 81
Slide 82: UK sales performance
UK sales performance H2 2018 (w/e 22 July 2018) H1 2018 H2 2017 H1 2017 Average outlets open 275 280 284 292 Average sales rate (net) 0.72 1.16 0.84 1.02 Average selling price £000 277 254 260 265 H2 2018 (w/e 22 July As at 2018) 1 July 2018 31 Dec 2017 2 July 2017 Total order book value £m 2,269 2,
Slide 83: UK market performance – affordable
UK market performance – affordable H2 2018 (w/e 22 31 Dec July 2018) H1 2018 H1 2017 Change 2017 Average outlets open 275 280 292 (4.1)% 287 Affordable order book 544 547 394 38.8% 400 £m Affordable order book 4,034 4,047 3,286 23.2% 3,159 units Affordable order book 135 135 120 12.5% 127 ASP £k Dat
Slide 84: Spain financial summary
Spain financial summary H1 2018 H1 2017 Change FY 2017 Average number of active sites 20 18 11.1% 18 Legal completions 130 68 91.2% 301 Average selling price (£000) 292 342 (14.6)% 311 Average selling price (€000) 332 394 (15.7)% 352 Revenue £m 37.8 24.6 53.7% 94.2 Operating profit* £m 9.5 2.8 - 26.
Slide 85: Glassdoor reviews
Glassdoor reviews Taylor Wimpey is a great organisation that is always striving to A forward thinking innovative company. resource, develop be better. For a decentralised organisation, there is a surprisingly and promote internally with a consistent culture across all the different business units. P
Slide 86: A reminder: Sites, outlets and factories
A reminder: Sites, outlets and factories, balancing sales and production ▪ Site – a single piece of land, generally getting outline planning as a single entity. TW size range 50-3,500 homes ▪ Outlet – a sales unit, with fully staffed customer presence. TW pa range historically 30-75 homes (incl. aff
Slide 87: Definitions
Definitions ▪ Operating profit is defined as profit on ordinary activities before net finance costs, exceptional items and tax, after share of results of joint ventures. ▪ Adjusted basic earnings per share represents earnings, attributed to the shareholders of the parent, excluding exceptional items