LONDON (dpa-AFX) - Taylor Wimpey Plc.(TW.L) announced new goals for the next five years to 2023. It expects increase of return on net operating assets to 35%. It maintained operating profit margins at about 21%-22%. It projects operating cash conversion of between 70 and 100% of operating profit into operating cash flow.
From 2019, the company will increase ordinary dividend to approximately 7.5% of Group net assets, up from 5%. This equates to at least 250 million pounds per annum, up from at least 150 million pounds per annum. This will provide an enhanced minimum annual return to shareholders throughout the cycle, including through various planning scenarios based on a 'normal' downturn and including a scenario where average selling prices reduce by 20% and volumes reduce by 30%.
The company noted that its special Dividend Policy is to pay out to shareholders the free cash generated by the Group after land investment, all working capital, taxation and other cash requirements of the business in executing strategy in the near term and the Group's ordinary dividend payments have been met. Subject to shareholder approval at next year's Annual General Meeting, the company will increase its special dividend for 2019 by 10 million pounds to 350 million pounds from 340 million pounds for 2018 (due to be paid in July 2018), taking total dividends to 600 million pounds, an increase of 20% from 2018.
In 2019, shareholders will receive a total dividend (including ordinary and special dividends) of approximately 600 million pounds or 18.3 pence per share, comprising an ordinary dividend of approximately 250 million pounds and approximately 350 million pounds by way of a special dividend.
The UK new build housing market remains stable across our geographies. Consumer demand remains high with good customer confidence, supported by very low interest rates and mortgages at competitive rates.
As the company announced in April trading statement, sales rates remain at healthy levels against very strong comparators. Average private sales for the year to date (to week 18) were 0.85 per outlet per week (2017 equivalent period: 0.93) and remain in line with expectations. Cancellation rates remain low at 13% (2017 equivalent period: 10%).
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