Crest Nicholson Shares Plunge as Profit Seen Potentially Below Guidance

Crest Nicholson Holdings plc (LON: CRST) shares tumbled more than 10% on Tuesday after the company said it anticipates its Adjusted Profit Before Tax (APBT) for the fiscal year 2025 to land at the lower end of, or slightly below, its previously issued guidance of £28-38 million.

This reflects a housing market that remained sluggish throughout the summer months, compounded by uncertainty surrounding upcoming Government tax policies.

The housebuilder delivered 1,691 units in FY25, hitting the bottom end of its 1,700-1,900 unit guidance. Open market sales units however, saw a 5% increase to 1,095, signaling some effectiveness in the group's tweaked sales strategy. The open market sales rate was reported at 0.51 (FY24: 0.48), but dipped to 0.45 for the last 13 weeks of the financial year.

The company anticipates an opening reserves adjustment to inventory of approximately £8 million. This adjustment addresses overstated profit related to a development in the Eastern division between FY22 and FY24, although the impact on APBT in those prior years is not expected to be material.

Crest Nicholson has made strides in bolstering its balance sheet. Year-end net debt is now expected to be at the favorable end of the £40-90 million guidance range. The company has also secured approximately £50 million in land receipts for FY26, providing further financial flexibility.

Martyn Clark, CEO, commented, “We launched our new strategic priorities at our Capital Markets Day in March this year and have made good progress in executing our transformation plan, Project Elevate. Encouragingly, progress across a number of areas is already evident, reflecting the early benefits of actions taken.”