Crest Nicholson Cuts Profit Forecast and Warns of Job Losses Amid Tax Uncertainty

Crest Nicholson has issued a warning that jobs are at risk following a downgrade of its annual profit forecast, attributing the move to persistent uncertainty surrounding government tax policy. The housebuilder’s shares closed down by 15 per cent at 139p after the company projected that profits for the year ending 31 October would be at the lower end of or slightly below the previously anticipated range of £28 million to £38 million.

Chief executive Martyn Clark stated that the reduced outlook reflected a housing market that remained subdued over the summer months and unresolved uncertainty regarding potential tax changes ahead of the forthcoming government budget. He noted that near term market conditions are expected to remain challenging.

In a trading update for the 2025 financial year, Crest Nicholson reported that 50 jobs were under threat as part of a transformation plan announced at its capital markets day in March. The company also proposed the closure of its Chiltern office in St Albans, one of its six divisional offices, as part of wider restructuring. This follows the earlier merger of the Midlands and Yorkshire divisions.

The focus of Crest Nicholson has shifted towards the mid premium sector, targeting affluent customers to mitigate ongoing macroeconomic challenges. While the company aims to complete a multiyear turnaround by 2029, this year’s figures have highlighted continued market pressure. The group delivered 1691 homes during the financial year, missing its target of 1700 to 1900. Revenue declined by 3 per cent to £249.5 million for the first half compared to £257.5 million for the same period last year.

Open market sales increased by 5 per cent year on year to reach 1095 by the end of October, attributed to an improvement in sales strategy, though the sales rate in the final 13 weeks of the year slipped to 0.45. The full year rate is expected to be 0.51, up from 0.48 previously.

Market analysts have highlighted that Crest Nicholson, with significant exposure to the south of England, has been particularly affected by subdued demand in the region. Commentary from larger housebuilders including Barratt Redrow and Taylor Wimpey has echoed these concerns, citing heightened caution among buyers ahead of possible changes to property taxation in the upcoming budget.

Crest Nicholson is also managing build cost inflation by implementing savings initiatives, seeking to limit the impact on profitability as it continues with its transformation strategy. The company reported a more than 20 per cent improvement in profit before tax during Martyn Clark’s first full year in charge, though results still missed consensus forecasts.