Residential developer Crest Nicholson has warned that its profits will be lower than expected for the year to 31 October 2018, as the market for new homes in London and at higher price points in the South struggled.
Meanwhile, the firm also announced that its chief financial officer Robert Allen was stepping down from the board and would leave the company after a “short handover period”.
Crest Nicholson said it now expected its profit before tax for the year to be “in the range of £170m to £190m” after sales failed to pick up during the traditionally stronger early autumn selling season. Last year, the housebuilder posted a pre-tax profit of £207m on revenue of just over £1bn.
The firm added that during the second half of the year, management actions to mitigate the reduction in sales volumes had underpinned revenue and receipts but impacted margins, which were now expected to be lower than the previous guidance of 18%.
The company said it would slow down its build rates and reduce its land expenditure, as well as driving operation efficiencies within the business.
Stephen Stone, executive chairman, said: "The usual Autumn pick up in sales volumes has not been evident during September and October, with many customers putting off decisions to buy whilst current political and economic uncertainties persist.
“Mindful of the current uncertain market environment, our new strategy will focus on shareholder returns by prioritising cash flow and dividends, maximising the value in our portfolio, and improving operational efficiency."
