Solihull housebuilder Taylor Wimpey put a brave face on the housing downturn yesterday, saying it expects to report full year results in line with market expectations plus improved margins.
The declaration came despite the fact it had to report that its order book was down almost a fifth on a year ago after confidence dived in the final six months of 2007.
The group, which sells homes under the brands George Wimpey, Bryant Homes, G2, Wilson Connolly and Laing H omes, reported orders worth £1.07 billion compared with £1.32 billion at the start of 2007.
Despite the weaker conditions, Taylor Wimpey said it remained on course to meet its expectations for profits in the 2007 financial year. It completed 20,645 homes last year, compared with 21,910 in 2006, but said that its focus on protecting UK margins - rather than chasing volume - had paid off.
The UK's biggest housebuilder - created following last July's merger of Taylor Woodrow and George Wimpey - said it expected a "subdued start" to the spring selling season with interest rates and mortgage availability likely to be key factors in determining customer confidence.
It said the merger continued to deliver benefits with the company on course to deliver savings targets of £70 million by the end of 2008 and £100 million in total by the end of 2009.
The company said: "Long term supply constraints in the UK continue to provide support to the market and our strong progress on integration will assist our drive for relative margin improvement, which will remain a priority over volume."
Chief executive Peter Redfern said the company had improved its UK housing margins by about two percentage points from the 12.5 per cent achieved last year.
"Despite a challenging second half in 2007, we have delivered on our key objective of improving UK housing margins," he said.
In line with Persimmon and Redrow, who reported last week, Taylor Wimpey has seen a rise in cancellation rates as mortgages become harder to obtain.
Competitor Galliford Try was also upbeat, saying it expects its first-half results to be substantially ahead of last year and in line with the board's expectations.
The Middlesex company said its building division continues to perform well in strong markets across the UK, while the infrastructure division is delivering a good performance and is benefiting from very positive markets with its public and regulated sector clients.
Galliford, which is carrying out a £20 million refurbishment project at Birmingham University, said it has made progress in the affordable housing and regeneration market and it is now working on eight major regeneration schemes, six of them with English Partnerships.
However, the housebuilding division has been trading in an increasingly difficult market during the period as the tightening of the credit markets and lower consumer confidence took hold, it said.
But, the integration of Linden Homes, acquired in March 2007, has gone well and has doubled the size of its house-building division, the company added.
At December 31, the division had reserved, contracted or completed sales with a total value of £473 million, of which £410 million is for the current financial year to June 30.
This represents 65 per cent of projected sales for the full year, compared with 70 per cent at the same point last year. Its order book has been maintained at £2 billion for the half year and sales were £473 million up from £204 million.