Jan 15 (Reuters) - UK homebuilder Taylor Wimpey warned of a decline in 2026 operating profit margin on Thursday, citing weaker opening order book and softer pricing on bulk deals. After a turbulent
Taylor Wimpey Anticipates Margin Drop in 2026 Amid Weak Demand
Taylor Wimpey's Financial Outlook
Jan 15 (Reuters) - British homebuilder Taylor Wimpey on Thursday said its operating profit margin would decline in 2026 from last year's 11%, disappointing expectations for a recovery, as muted demand saddled its order book and bulk deal pricing.
The company also trimmed its 2025 operating profit forecast to about 420 million pounds ($564.23 million) from 424 million pounds after completing 11,229 homes for the year, up from 10,593 a year earlier.
The company's shares were down more than 5% in early trading, ranking among the bottom performers on the FTSE mid-cap index.
Impact of Demand on Order Book
The cautious 2026 outlook, with its performance weighted more toward the second half than usual, follows the November British budget, which had reassured the market about property taxes and raised hopes that hesitant buyers would return to the market.
"While the decline in 2025 was expected, the sell-side consensus was for some degree of margin recovery in 2026," said Oli Creasey, head of property research at Quilter Cheviot. "Guidance for a further deterioration instead will not be what the market was hoping to see."
Taylor Wimpey said pre-budget uncertainty has spilled over into its 2026 order book, which stood at 1.86 billion pounds at the end of the year, down from nearly 2 billion pounds a year earlier.
Government Planning Reforms
"The government's planning reforms have been welcome and we've seen increased momentum in our recent planning permissions," Taylor Wimpey Chief Executive Jennie Daly said in a statement.
"However, while affordability is slowly improving, demand continues to be muted - particularly among the important first-time buyer category - which will constrain overall sector output."
Recent planning reforms, including the newly implemented Planning and Infrastructure Act that eased several regulatory bottlenecks, have helped speed up approvals and are expected to support Taylor Wimpey's development plans.
Market Reactions and Future Projections
Daly noted that there has been a "good level" of enquiries for the spring selling season, though it was too early to say how things would go.
The company is scheduled to report its 2025 results in March.
($1 = 0.7444 pounds)
(Reporting by Aatrayee Chatterjee and Raechel Thankam Job in Bengaluru; Editing by Subhranshu Sahu and Thomas Derpinghaus)
