March 2 (Reuters) – British homebuilder Taylor Wimpey (TW.L) said it was cutting jobs as it seeks to reduce costs after flagging weaker sales and forecasting it would build about a quarter fewer homes this year than in 2022 in the face of a slowdown in the housing sector.
Britain’s largest homebuilders have already cut back their building targets as higher mortgage costs and economic uncertainty depressed buyer demand.
“Some roles were made redundant, some were actually vacant following the recruitment freeze we had undertaken earlier in the year and we deployed some employees to other parts of the business that require them,” Chief Executive Jennie Daly told Reuters on Thursday.
The redundancies were across all business departments, Daly said but did not specify how many of its workforce of around 5,000 could be affected, adding that consultations were ongoing.
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The company said in January that it was expecting to generate annualised savings of about 20 million pounds ($23.95 million) from cost-saving steps.
It said the average selling prices for private home builds was expected to be at a similar level to the 367,000 pounds registered in the second half of 2022.
“Taylor Wimpey has indicated that sale prices are likely to remain firm despite recent house price index evidence,” Oli Creasey, equity research analyst at Quilter Cheviot, said.
British house prices posted the biggest annual decline in over 10 years in February and mortgage approvals dropped to the lowest level since 2009.
Taylor Wimpey’s sales rate for the year to the week ended Feb. 26 dropped to 0.62 homes per outlet, compared with 1.02 units a year earlier.
The order book – a key industry measure that gauges future sales performance – stood at 2.15 billion pounds ($2.58 billion) as of Feb. 26, down from 2.90 billion pounds a year earlier.
Taylor Wimpey now expects to build 9,000 to 10,500 homes in 2023, way below the 14,154 units it constructed a year ago.
Shares in the company were up 1.2% as of 0907 GMT after the developer earlier said operating profit for the year ended Dec. 31 grew more than 11% to 923.4 million pounds.
($1 = 0.8352 pounds)
(This story has been refiled to fix the typo in quote in paragraph 3)
Reporting by Suban Abdulla in London and Aby Jose Koilparambil in Bengaluru; Editing by Dhanya Ann Thoppil and Emelia Sithole-Matarise
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