Wednesday 27 August 2008

"Taylor Wimpey hit by massive loss"

The car crash in slow motion continues unabated.

TW's interim results presentation is very detailed, but the best bits are in the BBC article:

1. TW have written down the value of their land bank by £690m.

Sorry chaps, that's not good enough. TW are now valuing UK plots with planning permission at £41,000 (page 74), which is still two-and-a-half times as much as Barratts. The FT reported this on 1 July 2008 so it's not even news.

2. TW have written off the book cost of "the George Wimpey brand that it bought last year, to the tune of £816m".

Not actually quite correct, but yes, they paid £816 million more than GW is now worth, so they have to write off the difference, which is what I said they'd have to do in my earlier post.

5 comments:

Anonymous said...

I see that nearly 80 Labour MPs have signed a motion to award Taylor Wimpey a windfall tax rebate. To make this revenue neutral all those deemed "property-rich" (ie home-owners) will be subject to a £1,000 tax charge.

Mark Wadsworth said...

You are joking I hope. I can't find anything when I Google that.

Anonymous said...

MW

Sorry to panic you - I am joking but only just. It's just a mirror-image application of the self-serving and economically illiterate "reasoning" underlying the demands for a windfall tax on energy companies (which is backed by 70-80 Labout MPs and is, of course, given an overdose of oxygen by the BBC at every opportunity).

CityUnslicker said...

so when should I buy their shares?

Mark Wadsworth said...

CU, buy their shares once implied value of land bank hits £NIL.