Taylor Wimpey : Annual Report and Accounts 2023

Building for the

future

Annual Report and Accounts 2023

Contents

Strategic report	Directors' report	Financial statements	Shareholder information

Strategic report

1. Building for the future
2. Our investment case

1. Business overview

1. Chair's statement

1. Chief Executive's statement

1. Our business model

1. Our market environment

28 Market trends, opportunities and risks

1. Purpose, values and strategy
2. Performance and strategy

1. Operational review

1. Building for our customers

1. Building for our people

1. Materiality assessment

50 Our commitment to the

Directors' report

1. Governance at a glance

1. Board of Directors

1. Group management team
2. Chair's Q&A
3. Building strong governance

1. Board activities
2. Shareholder engagement
3. Workforce engagement

1. Board leadership
2. Monitoring culture
3. Diversity

107 Nomination and Governance Committee report

113	Audit Committee report
125	Compliance statement
129	Governance structure

Financial statements

1. Independent auditors' report

1. Consolidated income statement

1. Consolidated statement of comprehensive income
2. Consolidated balance sheet
3. Consolidated statement of changes in equity
4. Consolidated cash flow statement
5. Notes to the consolidated financial statements

1. Company balance sheet
2. Company statement of changes in equity
3. Notes to the Company financial statements

219 Particulars of subsidiaries, associates and joint ventures

Our investment case	Our business model
Read more on pages2 to 5	Read more on pages 16 to 20

Operational review	Our commitment to the
	environment
Read more on pages 39 to 42	Read more on pages 50 to 52

environment

53 Task force on Climate-related Financial Disclosures

69 Non-financial and sustainability information statement

71 Risk management

1. Principal Risks and uncertainties

1. Group financial review

1. Viability statement

130 Role of the Board

131 Remuneration Committee report

153 Statutory, regulatory and other information

226 Five year review

Shareholder information

227 Notice of Annual General Meeting

231 Notes to the Notice of Annual General Meeting

239 Shareholder facilities

Our reporting suite

Building for the

future

Annual Report and Accounts 2023

Our 2023 Annual Report is an integrated report which includes key sustainability and financial disclosures.

Sustainability Summary 2023

Building for a

sustainablefuture

More information on our materiality process, sustainability activities and policies can be found in our Sustainability Summary 2023.

84 Stakeholder engagement and priorities

87 Section 172(1) statement

Scan to view	Scan for the full
our online	Sustainability
Annual Report	Summary 2023
2023

Building for

the future

In 2023 we delivered a good performance in the face of challenging market conditions. Going forward, we remain focused on driving value and ensuring we are ready and able to take advantage of opportunities. We are building for the future.

Strategic report	Directors' report	Financial statements	Shareholder information

2023 was a challenging year for the industry and our customers with rising interest rates and cost of living pressures impacting affordability.

Our clear purpose to build great homes and create thriving communities remains unchanged and is even more important today for our employees, customers, communities and partners.

With the benefit of a strong landbank and financial position and led by an experienced management team, Taylor Wimpey is well set to respond to changing market conditions in an agile way, building on momentum to ensure we optimise value and are poised for recovery and future growth from 2025, assuming supportive market conditions.

We have a compelling investment proposition:

A strong and resilient	A high-quality landbank
business, well positioned	that differentiates us
for all market conditions
see page 2	see page 3
A sustainable and	Reliable shareholder
responsible business	returns
see page 4	see page 5

1 Taylor Wimpey plc Annual Report and Accounts 2023

Strategic report

Directors' report

Financial statements

Shareholder information

Our investment case

resilientStrong and

Experienced senior leadership and highly engaged employees

Tight control of cost and work in progress, ensuring build rates are aligned with sales rates at a site level

Increased standardisation to drive quality, savings and incremental operational efficiencies

Strong balance sheet

Leveraging Taylor Wimpey Logistics and our new timber frame facility to support security of supply, increase visibility and speed of build

Increased use of technology on site and data monitoring to aid simplification and drive decision-making

Focused on operational excellence to optimise margin and drive attractive long term returns

4.89

Construction Quality Review average score (out of 6)

(2022: 4.81)

13.4%

Operating profit margin*

(2022: 20.9%)

2 Taylor Wimpey plc Annual Report and Accounts 2023

Our investment case continued

We have a balance sheet light, industry leading strategic pipeline of c.142k potential plots (31 Dec 2022: c.144k)

£61bn

potential revenue in our landbank across both the short term landbank and strategic pipeline

(31 Dec 2022: £61bn)

High-quality,well-located landbank in places people want to live

Strategic report	Directors' report	Financial statements	Shareholder information

c.80k

plots in short term landbank

(31 Dec 2022: c.83k)

landDiffere tiated bybourank

Our high-qualitylandbank together with an industry-leading strategic land pipeline provides optionality throughout the cycle

c.8k

plots converted from strategic pipeline (2022: c.4k)

We remain selective in acquiring new sites but will be active where we see good opportunities to create value for shareholders

3 Taylor Wimpey plc Annual Report and Accounts 2023

Strategic report

Directors' report

Financial statements

Shareholder information

Our investment case continued

Sustainable and

responsible

ESG is embedded throughout the business

for the benefit of all our stakeholders

We are driven by our purpose to build great homes and create thriving communities and by our core value to 'do the right thing'

98%

of our employees agree that we take health and safety seriously (2022: 98%)

Net Zero Transition Plan targets validated by Science Based

Targets initiative (SBTi)

Read more about our commitment to the environment on pages 50 to 52

In 2023, we launched our zero carbon ready prototype homes trial in Sudbury, the first trial of its kind on a live development site testing low carbon technologies

Read more on page 36

4 Taylor Wimpey plc Annual Report and Accounts 2023

Strategic report

Directors' report

Financial statements

Shareholder information

Our investment case continued

7.5%

of net assets or at least £250 million annually throughout the cycle paid out via an ordinary cash dividend

returnsReliable sha eholder 4.79p

2023 final ordinary

dividend per share

(2022: 4.78p)

Highly cash generative business - allows for investment for growth and attractive shareholder returns

We are committed to paying an annual ordinary dividend through the cycle, and returning surplus capital at the appropriate time

• Definitions and reconciliations of our APMs to the equivalent statutory measures are included in Note 32 of the financial statements. Please see page 81 for definitions.

9.58p

2023 total ordinary dividend for the year (2022: 9.40p)

Established, differentiated Ordinary Dividend Policy aimed at providing investors with visibility of the annual income stream they can expect throughout the cycle, including during a normal downturn

Read more about our capital allocation priorities on page 37

5 Taylor Wimpey plc Annual Report and Accounts 2023

Strategic report

Directors' report

Financial statements

Shareholder information

Business overview

We built over 10,000 homes in 2023, making us one of the UK's leading homebuilders. We operate across five divisions and at a local level from 22 regional businesses in the UK, with a small operation in Spain.

Where we operate

A national housebuilder operating at a local level.

Scotland, North East		North West
and North Yorkshire		and Yorkshire
4	3
regional businesses		regional businesses
Midlands		London and
and Wales		South East
5	5
regional businesses		regional businesses

Central, South

West and Spain

5 1

UK regional	Spanish
businesses	regional
	business

Spain

Map key

Head office

Regional offices

6 Taylor Wimpey plc Annual Report and Accounts 2023

Business overview continued

Net zero by 2045

Our net zero targets have been independently validated by the Science Based Targets initiative, and we were only the second UK housebuilder to achieve this

Read more about our Net Zero

Transition Plan on page 51

ESG ratings and accreditations

More information about our approach to, and performance on, sustainability and ESG topics can be found throughout this report:

Environment

50 Our commitment to the environment

53 Task force on Climate-related Financial Disclosures

Social

1. Building for our customers

1. Building for our people

84 Stakeholder engagement and priorities

Governance

1. Workforce engagement

1. Board Leadership

1. Anti-briberyand anti-corruption

1. Succession planning

1. Modern Slavery Act

Strategic report	Directors' report	Financial statements	Shareholder information

Built on a strong culture of doing the right thing

Respectful	Take
and fair	responsibility
Better	Be proud
tomorrow

We are defined by our purpose

To build great homes

and create thriving communities

To deliver superior returns for shareholders through

our high-quality landbank and enhance value

through sharper operational focus

Implemented through

our strategic cornerstones

Read more about our strategic cornerstones on pages 31 to 38

7 Taylor Wimpey plc Annual Report and Accounts 2023

Business overview continued

Delivering a good performance by managing through the cycle

*Alternative Performance Measures

The Group uses Alternative Performance Measures (APMs), such as those indicated above with a footnote symbol, as important financial performance indicators to assess underlying performance of the Group. The Group's two financial targets are operating profit margin and return on net operating assets. Definitions and reconciliations of our APMs to the equivalent statutory measures are included in Note 32 of the financial statements. Please see page 81 for definitions.

Strategic report	Directors' report	Financial statements	Shareholder information

Group financial	highlights
10,848		£3,514.5m	£470.2m
Group completions including	Revenue		Operating profit*
joint ventures
2023	10,848	2023	£3,514.5m	2023	£470.2m
2022		14,154	2022	£4,419.9m	2022	£923.4m
2021		14,302	2021	£4,284.9m	2021	£828.6m

£473.8m	9.57p		£677.9m
Profit before tax	Total dividend per share	Year end net cash*
		paid in the year
2023	£473.8m	2023	9.57p	2023	£677.9m
2022	£827.9m	2022	9.06p	2022	£863.8m
2021	£679.6m	2021	8.28p	2021	£837.0m

127.1p		13.4%		12.6%
Tangible net assets per share*	Operating profit	margin*	Return on net operating assets*
2023	127.1p	2023	13.4%	2023	12.6%
2022	126.5p	2022		20.9%	2022	26.1%
2021	118.1p	2021		19.3%	2021	24.7%

8 Taylor Wimpey plc Annual Report and Accounts 2023