UK homebuilder swings to loss following Fire Safety Pledge


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UK homebuilder Crest Nicholson Plc has reported being pushed into a loss in the first half of the year after pledging to fix safety issues on apartments buildings.

The company reported a loss before tax of £52.5 million ($64 million) for the six months through April after recording an charge of £105 million in the half year, according to a statement Tuesday.

The charged wiped out growth in sales and prices as the UK’s new build housing market continued showing no signs of slowing down as rising rates and a cost of living squeeze threaten to damp demand. 

The pledge is a result of the UK’s debate over how to address widespread fire safety failures that were exposed in 2017 by Grenfell Tower fire in London. Uncertainty over who should fund repairs left thousands of homeowners unable to sell their homes and trapped in tower blocks that may be unsafe. 

This in turn prompted the government to seek commitments from homebuilders to help fund repairs, with large publicly traded firms expected to make contributions that will help cover the cost of repairs on buildings whose developers no longer exist or are overseas and unwilling to pay. 

“We are pleased to have reached a resolution with the government by signing the Building Safety Pledge,” Chief Executive Officer Peter Truscott said. “We hope this now provides comfort and assurance to affected residents and stakeholders. It also allows the group to move forward in remediating the affected buildings directly or through another party as soon as possible.”

Crest’s revenue climbed 12.3% in the half year period while home completions rose 7.8%.

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