Crest Nicholson (CRST) H2 2024 earnings summary

Executive summary

• FY 2024 results were in line with guidance but considered disappointing due to challenging macro conditions, leadership changes, and a distracting offer period over the summer.

• CEO and CFO transitions occurred, with a new strategy focused on quality, customer service, and optimizing the land bank.

• Significant progress was made on legacy fire and non-fire issues, with a focus on completing surveys and cost reviews to ensure financial commitments are met.

• Governance and financial discipline were strengthened, with rapid operational changes and a focus on consistent shareholder returns.

• The business is positioned for a transition year in 2025, aiming to reset foundations and embed strict commercial and financial controls.

Financial highlights

• FY24 revenue was £618.2m, down from £657.5m in FY23; adjusted gross profit £86.8m vs £105.6m.

• Adjusted profit before tax fell to £22.4m; exceptional items totaled £166.1m, mainly for fire remediation and legacy site costs.

• Adjusted basic EPS was 5.6p (FY23: 14.2p); final dividend proposed at 1.2p, total 2.2p for the year (FY23: 17.0p).

• Year-end net debt was £8.5m, compared to net cash of £64.9m in FY23, but better than guidance.

• 1,873 completions delivered, including 238 JV units; average outlets fell to 44 from 47.

Outlook and guidance

• 2025 is set as a transition year, with a focus on customer-centric strategy, operational excellence, and improved controls.

• FY25 guidance: open market completions 1,050–1,150 units; bulk/affordable 650–750 units.

• Forward order book for FY 2025 at 1,051 units; planning in place for almost all units.

• Gross margin expected to improve as low/zero margin site revenue halves from £100m to £50m.

• Adjusted EBIT guidance: £28m–£38m; year-end net debt expected between £40m–£90m.

• £70m to be spent on combustible remediation; no significant tax payments expected until FY 2027.