Crest Nicholson (CRST) CMD 2025 summary

Strategic Priorities and Market Positioning

• Refocused strategy on the mid-premium housing segment, targeting affluent buyers and downsizers, and moving away from volume-led, multi-channel and PRS contracts to prioritize value growth and disciplined volume growth.

• Strong brand, well-located land bank, and experienced leadership underpin the new strategy, aiming for sustainable shareholder returns and significant uplift in medium-term performance.

• Plan to capture up to 10% market share in the mid-premium segment, leveraging underutilized brand and land assets, with a roadmap for shareholder value.

• Commitment to operational and commercial excellence, optimizing the land portfolio, and building exceptional quality homes efficiently.

• Transformation program spans 2–3 years, focusing on operational efficiency, customer experience, and talent development.

Operational Transformation and Customer Focus

• Enhanced build quality and specification, with new house type designs, standardized processes, and product refreshes to reduce defects and warranty claims.

• Strengthened quality review processes, improved customer service, and centralized fire remediation management.

• Achieved significant improvements in customer satisfaction metrics, including HBF five-star status and a 95.0% satisfaction score for 2024.

• Sustainability initiatives include net zero by 2045, biodiversity commitments, zero-carbon ready developments, EV charging, and waste reduction.

• Overhauled sales process, commission structure, and customer journey, with retrained sales teams and improved marketing and digital tools.

Financial Guidance and Capital Allocation

• FY2025 guidance unchanged; targeting mid-single-digit CAGR in completions to over 2,300 units by FY29, maintaining open market share at 60-66%, and reducing PRS exposure.

• Gross margin targeted to rise from 14% (FY2024) to over 20% by FY29, with annual improvement of 100–150bps, and EBIT margin target of 13%+.

• Overhead reduction to 7% of revenue by FY27, with process streamlining and cost controls.

• ROCE forecast to improve from 4% to over 13% by FY29, with cash performance ahead of expectations.

• Inventory reduction of £200m targeted, lowering inventory value to £900–950m by FY29, with cash generated covering fire remediation and future land needs.