Taylor Wimpey Share Discussion Threads

[imastu pidgitaswell] 29/7/2020 08:10

They would have gone negative net cash, yes - not run out of cash, as they had the revolving credit facility of £0.5 billion

There were 3 lots of £0.5 billion (give or take):

The unpaid dividend (still have)
The rights issue cash (still have)
The credit facility drawdown (repaid)

They have carried on paying for land and buying new land throughout. In extremis, they would stop buying land - but the national lockdown is now over. We'll see.

[sr2day] 29/7/2020 08:09

all the way down to 100p.

[hernando2] 29/7/2020 07:53

They raised 510 and if i have read the report properly(unlikely) they spent just under 400 on Land?

So without the raise they would have run out of cash?

They are aiming at 80% of normal capacity going forward so circa 20% reduction in revenue, can they reduce costs by the same ratio or will fixed overhead eat into that?

I guess the fall in the Shareprice reflects a lot of the uncertainty.

It's good that material supply is good, i know smaller builders and DIY people are having difficulty especially with plaster and some finishing materials.

I know of people having to pay 40 quid fro bag of plaster to finish small indoor jobs.

[jugears] 29/7/2020 07:52

Imatsu you forgot to mention dividends, Personally I think they have done extremely well & more than happy with my recent investments in Tw.IMO all the bad news is built into the share price because let's face it the markets always panick first with out waiting & finding out the true facts, but then how else would they make money. As far as dividends go I like there cautious approach & think we will see a bumper special dividend in 2022.

[stewart64] 29/7/2020 07:50

Sales order book up even before the stamp duty announcement.

[imastu pidgitaswell] 29/7/2020 07:40

More of a balance sheet or 'closing position' set of results then I&E, as fall in volumes and revenues and fixed costs resulted in net loss.

"Balance sheet" points:

£0.5 bn net cash at end
Drawn revolving credit of £0.5bn repaid
Net tangible assets per share up
Sales outlets open at 30 June higher than 30 December
All workers returned
Sales order book up 15% vs last year at 30 June
Sales forward for 2020 at 97%


H2 will also be impacted - it's really about how they come out of 2020 and go into 2021. Good story so far - it will be interesting to see how the other builders do.

Also worth remembering the share price was 230-odd in December/January. Is the mess of 2020 priced in? Round and round we go...

[gbh2] 29/7/2020 07:25

No huge surprises, steady as she goes report.

[stewart64] 28/7/2020 16:26

What happens in the auction between 4:30 and 4:35 might be telling. Look at what happened to Unilever last week ( I think). The auction was indicative.

[imastu pidgitaswell] 28/7/2020 12:14

363 - :-)

Yes, looking good, but to extend (painfully) to a WW2 analogy, it's all a bit of a phoney war - until tomorrow...

[sikhthetech] 28/7/2020 12:08

stewart,

New builds typically cost 20% more, therefore the new owners are already in negative equity when they move in.

If the housing market crashes then H2B could become toxic. There is still interest to pay on H2B loans and with a recession and people losing their jobs, this could have serious consequences..


Who will pick up the bad H2B loans????

[stewart64] 28/7/2020 12:04

Household mortgsge debt has not increased much since 2007 in nominal terms. Certainly well down in inflation adjusted terms. Of course, the Government has had to do the borrowing for us instead to keep the skittles in the air.

[jonwig] 28/7/2020 11:35

stewart - UK mortgage debt:



It's lagged house prices, which is probably what you mean. Can't find a chart beyond 2017.

Number of mortgages approved is about static since 2009.

[1carus] 28/7/2020 11:20

IP, yes I stand corrected. My point I was making to Sikh was simply that you cannot compare the actions in war where things have to happen often at great sacrifices, to a pandemic where we have choices, taken correctly or not.

Anyway, things lookiong good here this morning!

[stewart64] 28/7/2020 11:08

Are we too doom mongering on all this H2B etc about to blow up, anybody would think the whole Market was on tick. Housing debt has barely moved in 13 years since the Madness of Gordon Brown. It's an 8 trillion Market of which 1.2 trillion is on mortgage. For most of the UK we have been deleveraging and a slow inflation adjusted fall has taken place. Anybody would think the whole country has followed the line of Oxbridge and London.

Hm a Georgian county house for less than half a million in somewhere like Wales or Lincolnshire or twice the price for a Brutalist flat in Taipei or Beirut. And the UK popualtion up from 58 to 70 million in just 20 years.

[sikhthetech] 28/7/2020 10:49

Jonwig

Help to Buy.

I think the govn are stuck in a pickle..

If the housing market crashes then these H2B loans will become bad, toxic, loans.
This could lead to another financial crash..

It was cheaper to raise the Stamp Duty threshold to try and kick start the housing market than suffer the consequences of dealing with bad H2B loans..
However, it could back fire.

[imastu pidgitaswell] 28/7/2020 10:34

Yeah, dunno. And all very one-off, specific to H1, which will include all sort of one-off costs and benefits - as well as low sales volumes. H2 also likely to be similar. Only next year will we really see the real 'new normal'.

But also hundreds of millions in cash from the RI and hanging on to the dividend.

For me, it's all about the outlook - which might be somewhat murky. But TW better placed than anyone, methinks.

[jugears] 28/7/2020 10:34

Well we wont no until tomorrow but my guess is they are better than expected.

[stewart64] 28/7/2020 10:29

Volumes down as you say. But unlike many organisations will the shutdown have hit TWs finances that much, zero dividends, zero debts, Government compo, is mothballing sites that expensive when you are participating in furlough?

I was looking at it from an expenditure perspective and financial health.

[imastu pidgitaswell] 28/7/2020 10:20

The results won't - the volumes are (largely) already out there (post 315), and they are well down.

The prospects might, though. But more likely the market will take a view after several builders have had their say, to get a national view.

[stewart64] 28/7/2020 10:17

I'd expect the results to surprise to the upside but heck I could be totally wrong. There was total shutdown on TW sites but at minimal cost and the housing market has been ridiculously buoyant since the stamp duty announcement in the Market generally ( though not covered by these interims). Only risk might be that TW jumped the gun on impairments to inventories and underestimated the strength of the Market bounce. Could all go pear shaped when furlough finishes obs. But the accounts should be a snap shot in time not crystal balling.

[martyn9] 28/7/2020 09:28

Usually the share price falls on decent news for some reason,i'm hoping this pattern reverses for once.

[imastu pidgitaswell] 28/7/2020 09:25

Results tomorrow - price action yesterday and today all very predictable. And very nice.

[imastu pidgitaswell] 28/7/2020 07:12

Maybe it's their geography - Arctic / Atlantic?

:-)

[hernando2] 28/7/2020 07:05

Imastu- I almost posted exactly the same thing...people don't know their history.

[jonwig] 28/7/2020 06:42

FT:

UK ministers are drawing up plans to extend the Help to Buy property support scheme beyond its December deadline to prevent buyers losing out due to Covid-19 delays.

The government is set to prolong the Help to Buy Equity Loan programme, which allows people in England to buy a new-build property with a tiny deposit, to protect several thousand people whose purchases have been delayed by the coronavirus pandemic.