Taylor Wimpey, the U.K.-based parent company of Taylor Morrison in the United States reported Wed. Aug. 5 that stability has returned to its home building markets in Great Britain, the U.S., Canada, and Spain.
But stability didn’t amount to profit. While the company as a whole managed to narrow its losses, they were still substantial at 681.9 million pounds ($1.16 billion) for the first half of 2009 compared with 1.4 billion pounds ($2.4 billion) in the same period last year.
The scenario for the company in North America, which includes Canada, was better. It posted an operating profit of $27.9 million, though that was an 18.2% decrease from the first half of 2008 when the company, boosted by Canadian sales, booked a $34.1 million profit. Margins, however, were up from 4.8% to 5.2%.
Taylor Morrison closed 1,279 homes in the U.S. in the first half of 2009 compared to 1,677 in the first half of 2008. And the average sales price fell to $259,000, from $303,000 in 2008.
The first part of the second quarter has shown improvements as well. “In the past few weeks we have achieved a strong increase in sales rates against those in the previous 12 months and the cancellation rate of 18% is at its lowest rate in the last three years,” the company reported.
The company has also been able to reduce its unsold finished homes in North America to 177 from 455 at the end of 2008.
The company affirmed its faith in the leadership of Sheryl Palmer, president and chief executive of Taylor Wimpey’s North American operations, by appointing her to the board on the cusp of her two-year anniversary with the company.
“I am delighted to welcome Sheryl Palmer to the board,” said chairman Norman Askew in a written release on the announcement. “She has a wealth of experience of the North American housing market and has led the Taylor Morrison business during a very challenging period with distinction since her appointment.”
Teresa Burney is a senior editor for Builder and Big Builder magazines.