Taylor Wimpey slashes dividend as forecasts low-end 2026 completions
Taylor Wimpey PLC on Friday announced it was lowering its annual shareholder returns target noting the UK housing market downturn has proved more prolonged than anticipated.
The High Wycombe, England-based housebuilder now expects annual returns to amount to 4% of net assets, cut from the previous level of around 7.5%. The new target will comprise a minimum of 2% as an ordinary dividend, together with a further 2% returned either via dividends or share buybacks.
Reflecting the revised policy, Taylor Wimpey on Friday declared an interim dividend of 1.20 pence per share, 74% lower than last year's 4.67p payout, and authorised a further £42 million share buyback to start immediately.
The change "strikes the right balance between continuing to provide an attractive level of shareholder return whilst giving the group greater flexibility and resilience through the cycle," the company said.
Shares in Taylor Wimpey fell 3.5% to 80.12p each in London on Friday and have fallen 22% in the last 12 months.
The news came as the FTSE 250 firm reported operating profit and completions in the first half of 2026 ahead of forecast, but guided completions to the bottom end of previous projections.
Pretax profit totalled £116.8 million in the six months ended June 30, swung from a £92.7 million loss the year prior.
Adjusted operating profit fell 19% to £129.7 million from £161.0 million, but beat £106 million Visible Alpha consensus.
Revenue edged up 1.7% to £1.68 billion from £1.65 billion. Basic earnings per share were 2.5p versus losses of 1.7p a year prior.
Group completions including joint ventures of fell to 4,986 homes from 5,264.
UK completions excluding joint ventures were 4,723 homes, down from 4,894 last year, but ahead of 4,595 VA consensus.
Net private sales rate of 0.75 per outlet per week was lower than 0.79 a year ago, with a reduced cancellation rate of 14%, down from 16%.
"The market backdrop remains uncertain following a more challenging second quarter, where affordability constraints and increased geopolitical uncertainty impacted customer sentiment and behaviour. While underlying customer demand continues to be good, conversion is taking longer and buyers remain highly price conscious," Taylor Wimpey said in a statement.
In the four weeks to July 26, net private sales rate was 0.55 per outlet per week compared with 0.59 the year prior, and the cancellation rate for the same period was 18%, down from 19%.
Taylor Wimpey expects market conditions to remain challenging for the remainder of the year, with underlying pricing below prior year levels and full year build cost inflation of around 3% to 4%.
"Without targeted demand support and viability measures to unlock delivery, weaker demand, rising costs and limited affordable housing funding risks reducing sector output and UK economic growth," it added.
The firm expects UK completions excluding joint ventures for the full year to be between 10,600 and 10,800 homes, within the lower half of the 10,600 to 11,000 range provided in March.
No full-year operating profit guidance figure was provided.
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