Crest Nicholson upgrades expectations as it moves back into profit

Crest Nicholson has posted a pre-tax profit of £36.3m for the first half of the year, compared to a £51.2m loss for the equivalent covid-hit period in 2020.

The house builder, in its interim results for the six months to 30 April, was buoyed by a 38% increase in completions to 1,017 over the same period. Revenue increased from £240m to £324.5m over the same period.

The company is now projecting adjusted pre-tax profit for the whole year to be “at least” £100m, up on the already-increased £85m outlined in March. It said its order book is now 93% covered as of 18 June.

Crest is currently in the midst of a turnaround strategy after a difficult few years during which it issued several profit warnings. Peter Truscott, formerly of Galliford Try, was brought in as chief executive in September 2019 to improve the situation.

Last year the firm announced 130 redundancies and wrote off £43m in the value of its landholdings, given expectations of future price falls.

Responding to today’s results, 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.”

Crest also revealed it has increased its provision for the fire safety remediation of blocks by £10.3m. The fund for this work, including the replacement of unsafe cladding, now stands at £23.2m, with £15.5m expected to be used within one year.