McCarthy & Stone will cut up to 90 jobs in 2014, as its new chairman told Construction News it will focus on development-led schemes with scope to open new offices over the next three years.
The retirement developer specialist announced an organisational review today in its latest trading update, which Construction News understands will see up to 90 job losses by summer this year.
Speaking to Construction News days before the announcement, McCarthy & Stone chairman John White said he was looking to use his housebuilding experience to boost a new development-led focus.
Former Barratt and Mount Anvil director Clive Fenton also joined the group as chief executive last month, replacing Mark Elliot who announced his departure in November last year.
Former Persimmon chairman Mr White said the housebuilding “heavyweights” would bring a dramatic shift for the company.
McCarthy & Stone would become more development-led, he said, as the team looks to expand regionally across the UK and increase its volumes by 10 to 15 per cent during 2014.
In its latest trading update published today, McCarthy & Stone posted a 30 per cent increase in completions to 659 units for the half-year ended 28 February 2014.
Mr White told Construction News the team had the capacity to increase this again by up to 15 per cent in 2014, with each of the group’s five regional offices able to build between 400 and 450 units per year.
He said the company’s goal thereafter was to get back to peak volumes of 2,327 completions a year, seen in 2006/07, which he said would be achieved by increasing existing capacity.
The chairman also added that there was room to open two to three satellite offices over the next two to three years in areas where the team “was spread thinly”, such as Wales and the Midlands.
McCarthy & Stone half-year revenues were up by 50 per cent to around £150m and forward sales stood 30 per cent ahead of the prior year at around £133m.
Mr White said he wanted to give more power to the regions, making the business more efficient, and said the group would be pushing for quicker development times.
On Mr Eilliot’s departure, the chairman said that Mr Elliott “did a good job” during his time with the group but as the team moved into a development led strategy it was clear it needed “a different sort of person” in charge.
He said: “Mark was there for 12 months and did a good job at getting the refinance business sorted. It was very apparent having done that, that we needed a different set of skills to take us forward over the next three to five years.
“What we want to do is very much focus the business on the development side, providing retirement homes and specialist retirement homes and also broadening our product.”