Crest Nicholson returns to profit as it plans shift towards mid-market premium delivery

Crest Nicholson has returned to profit in what it has described as a “year of transition”, following cuts to divisions and redundancies.

The housebuilder in its annual results for the year to 30 October posted pre-tax profit of £2.9m, compared to a loss of £145.8m the previous year.

However, it’s adjusted operating profit was £26.5m, which was lower than the £28m to £38m range the housebuilder had previously indicated it would achieve.

Crest Nicholson said its figure had been impacted by “weaker market conditions in the second half of the year”.

The group’s turnover fell slightly from £618.2m to £610.8m while its completions dropped by nearly 10% from 1,873 to 1,691 homes.

The firm confirmed it closed its Chiltern division in December and merged its Yorkshire and Midlands arms. It made 50 roles redundant as a result of the changes, which were trailed in November and are intended to “maximise productivity”

The overhaul is part of Crest Nicholson’s ongoing Project Elevate restructuring programme launched following the £145m loss the previous year amid increased building safety costs.

It said: “These changes were strategically necessary to create a more focused and efficient operating model, and will help reduce our overhead costs going forward.”

Crest Nicholson also said it is reconfiguring its land bank to enable it to shift its focus to the ‘mid-premium market’, which it believed is steadier with firmer pricing and “less price-sensitive buyers”.

It said: “This housing segment has consistently demonstrated greater resilience and stronger performance than the traditional volume-led housebuilding market, particularly through periods of economic uncertainty”.

Crest Nicholson placed 13th in Housing Today’s annual Top 50 Housebuilders table, which ranks firms by turnover.