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Taylor Wimpey sees first-half profits drop after £130mln charge for ground rent scandal, but to pay another special dividend

Published: 17:29 01 Aug 2017 AEST

Housebuilding
Taylor Wimpey saw its first-half revenue increase by 18.5% to £1.7bn as the company completed a total of 6,580 homes, up 9.3% on the year before

Taylor Wimpey PLC (LON:TW.) saw its first-half profit drop as it set aside £130mln to compensate homebuyers that were affected by a ground rent scandal, but has rewarded shareholders with another special dividend.

In the half-year ended July 2, the FTSE 100-listed housebuilder saw its headline pre-tax profit fall by 23.7% to £205mlm, down from £268.8mln a year earlier, as it took the provision as an exceptional item in its accounts – excluding the charge, pre-tax profits were up 25.7% to £335mln.

READ: Taylor Wimpey to take £130mln provision for ground rent dispute as 2017 sees good start

Taylor Wimpey saw its first-half revenue increase by 18.5% to £1.7bn as the company completed a total of 6,580 homes, excluding joint ventures, up 9.3% on the year before.

Meanwhile, total average selling prices rose by 6.3% to £253,000, excluding joint ventures.

The firm announced a special dividend of £340mln, or around 10.4p per share, to be paid in July 2018, an increase on the £301mln, or 9.2p a share paid last month.

The group also hiked its ordinary interim dividend to 2.3p, up from 0.52p a year earlier, and said its target is to return £1.3bn in dividends over 2016-18 will be achieved.

Taylor Wimpey’s chief executive, Pete Redfern said: "Trading through the first half of 2017 has been very positive, supported by favourable UK housing market fundamentals and good customer confidence.

“In the central London market in particular, we are pleased to see improved customer confidence following a period of uncertainty.”

He added: "Although the wider political backdrop could have an impact on confidence levels and market dynamics, we have seen no material change in trading since the General Election, and our first half performance has been strong.”

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