Taylor Wimpey fire safety work costs soar to £333m

Aaron Morby 9 months ago
Share

Taylor Wimpey has been forced to increase provisions for expected fire safety work after an escalation in costs on recent tenders.

The house builder had previously set aside £245m to cover the full fire safety remediation of its building portfolio. But this morning Taylor Wimpey said the expected cost had now soared by over a third.

In a statement alongside lacklustre results for the first six months of the year, chief executive Jennie Daly said: “We have reassessed the remediation costs based on tenders received in the first half.

“Based on this updated information and enhanced cost appraisal, the expected fire safety remediation cost has increased by £88m, taking the total provision to date to £333m.

“The increase is due to escalation of costs based on recent tenders, increased project delivery administration costs, including the funding of the Building Safety Fund pre-tender costs and a small number of new buildings being added.”

The soaring cost of fire safety remediation work to the housing industry amid Government changes in scope of buildings requiring work is illustrated by the sharp rise from initial estimates.

Just three years ago, Taylor Wimpey expected recladding and fire remediation to cost £125m.

During the first half Taylor Wimpey continued to progress work with building owners, management companies and leaseholders and remained committed to resolving issues as soon as practicable for its leaseholders.

The house builder said 211 buildings were within the scope of the provision, all of which have been now assessed by its specialist team.

The hike in provisions contributed to a 58% plunge in pretax profit to £100m in the first six months of this year.

Underlying margin for the first half was lower, given residual build cost inflation in the order book and weaker pricing, however this was partly offset by higher profit from land sales.

Taylor Wimpey said that prevailing build costs on new tenders were now flat, with its self-help value improvement measures leading to slight cost deflation.

Daly welcomed the new government’s planning reforms unveiled yesterday as a “recognition that planning is a major barrier to economic growth”.

“Though we expect changes to take some time to impact, we see the planning reforms outlined by the new Government as key to unlocking future years land supply and the investment in skills and resources necessary to support future housing need.

“We have been actively preparing for planning changes and focused on developing high-quality planning applications from the strategic pipeline.

“We have around 30k applications in the planning process and additional applications ready to go if we see the proposed grey belt changes come through.”

Latest news

Comment: Gateway is acting like a barricade

Contractors left banging their heads on an (unbuilt) brick wall
18 hours ago

Final phase of £1.5bn Elephant and Castle revamp hits planning

Get Living submits revised plan for 500 homes and 450-bed student block
2 days ago

Ealing backs final phase of £1.3bn estate rebuild

Friary Park estate rebuild in Acton reaches end stage
18 hours ago

Green light for scaled-down Nottingham student tower

Glasshouse Street scheme will deliver 247 student rooms
18 hours ago

Aston Villa to revamp North Stand

Club to reuse existing structure rather than complete rebuild
2 days ago

Mace signs ex-ISG director to lead Euro health and tech push

Gary Sweeney to head up healthcare and life sciences consultancy arm
17 hours ago

Sir Robert McAlpine claws way back into profit

Firm says return to profit and strong cash balance validates new strategy
2 days ago

Severfield to cut staff by 6% amid pricing pressure

Steelwork contractor warns of extended tighter pricing due to project delays
2 days ago

JRL completes sale of 50% stake to Malaysian giant IJM

Deal boosts balance sheet and kicks starts growth plan
2 days ago

Green light for £100m Liverpool Baltic station build

Enabling highway works to start in the autumn
3 days ago

First live tests for flying construction robots

Drones can lay construction materials at height on site
2 days ago

Three firms land £170m Gentoo Sunderland housing deal

PHS Solutions, Esh and RE:GEN to deliver 10-year home upgrade plan
3 days ago

Gateway gridlock hits build-to-rent delivery as starts nosedive

Build to rent starts plunge 18% in the capital
3 days ago

Call to shift Gateway 2 checks to end building bottleneck

"The current system isn't working but we all want to see safe buildings"
3 days ago

GBN launches £600m bid race for SMR engineer roles

Owner engineers to provide technical and assurance services
3 days ago

Wates hires ex-Homes England chief to head public sector push

Robert Stone to spearhead its public sector and national frameworks strategy
3 days ago

Acheson Construction collapse costs suppliers £8.5m

One frustrated creditor seized a telehandler after contractor went into administration
3 days ago

Dominus wins go-ahead for 173-bed Glasgow scheme

Old Wynd Street job expected to cost around £25m to build
3 days ago

Safety Regulator misses deadline to clear Gateway 2 backlog

Investors pulling out of funding high rise buildings
4 days ago

CITB still sitting on £95m cash pile

Staff numbers jump from 666 to 763 as training body wage bill soars
4 days ago

£500m road surfacing framework market call

NEPO goes out to consultation on north east regional highways deal
4 days ago

Two share £220m Scottish rail repairs and minor works deal

AmcoGiffen and CPMS win civils and building repair deals
4 days ago

Builder wanted for £60m London leisure and flats job

Tower Hamlets aims to replace St George’s Leisure Centre in Shadwell
4 days ago

Contractor confirmed for business park expansion

Roe Developments to start on next phase of Castle Donington scheme
4 days ago

Driver escapes injury as scaffold collapses onto van

Major three-lift scaffold fall blocks north London high street
1 week ago

Gilbert Ash to be sold to staff

£267m turnover contractor to transition to an Employee Ownership Trust
1 week ago

M Group seals biggest-ever deal with Telent takeover

Digital infrastructure specialist deal lifts turnover to £3bn
1 week ago

Aggregates firm Ashville went down owing more than £3m

Debts revealed in Companies House update
1 week ago

Cardo saves 100 jobs at Breyer roofing arm

Private equity-backed Welsh maintenance group continues to expand
1 week ago

Excavator knocked off lorry going under bridge

Traffic Commissioner inquiry after accident in south London
1 week ago

Contractor services