Crest Nicholson Signals Housing Market Recovery with Positive Full Year Results, Shares Rise

Crest Nicholson (LON: CRST) has released its preliminary results for the year ended October 31, 2025, aligning with the November trading update and showcasing early signs of an improving housing market.

The company's strategic shift towards the mid-premium market segment, coupled with balance sheet improvements, has positioned it for future growth.

Following the report, CRST shares have risen more than 5% to 143p.

Headline Numbers:

• Revenue: £610.8 million (down 1.2% year-over-year)
• Operating Profit (Adjusted): £34.7 million (up 18.8% year-over-year)
• Profit Before Tax (Adjusted): £26.5 million (up 30.5% year-over-year)
• Basic Earnings Per Share (Adjusted): 7.8p (up 56.0% year-over-year)

The company's focus on strengthening the balance sheet is evident in the reduction of net debt to £38.2 million, significantly better than previous guidance. This was achieved through strategic land sales, generating £78.8 million in revenue with a gross margin of £17.1 million, and tighter inventory management. Inventory was reduced by £73.0 million (6.5%) to £1,056.1 million. Furthermore, Crest Nicholson successfully renewed its £250 million revolving credit facility with existing lenders, extending the term to October 2029, providing financial stability and flexibility.

A dividend of 3.1p per share was declared, marking a 40.9% increase from the previous year, reflecting the company's improved profitability and confidence in its future performance.

Driver Breakdown:

• Strategic Repositioning: Shift to the mid-premium market segment is underway, with new house types designed and adopted for future planning applications.
• Operational Efficiency: “Project Elevate” transformation plan is driving cost improvements and enhancing build quality, as evidenced by a reduction in NHBC reportable items.
• Land Management: Proactive land sales and acquisitions are optimizing the land bank for future growth and margin expansion.

CEO Martyn Clark emphasized the progress made during the year, stating, “2025 has been a year of transition and transformation for Crest Nicholson… We have made meaningful progress against each of the key strategic priorities… repositioning the Group to the mid-premium market segment.”

While trading conditions at the start of 2026 remain subdued, Crest Nicholson is observing early signs of improvement since Boxing Day, with increased website visits, enquiries, and appointment conversions. January sales rates have strengthened, supported by easing interest rates and improved affordability.

The forward order book for 2026 stood at 848 units as of January 25, 2026. The Group anticipates increasing its outlet position in the second half of 2026, launching new margin-accretive sites.

Guidance for 2026:

• Open market units: 1,100 – 1,200
• Bulk and affordable units: 450 – 500
• Outlets (average): c.42
• Sales rate: 0.5 – 0.6
• Land sales revenue: £75 – £100 million
• Adjusted gross margin: 15% – 16%
• Adjusted PBT: £32 – £40 million
• Net debt: £15 – £65 million

The completion of the fire provision assessment program and ongoing remediation efforts provide clarity and reduce uncertainty for investors. The increase in expected costs, net of recoveries, of £4.1 million is manageable within the company's overall financial framework.