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Crest Nicholson rolls out new business strategy; CFO steps down

Crest Nicholson Holdings PLC CFO Robert Allen is relinquishing his seat at the board, with plans to exit the company after a short handover period.

CEO Patrick Bergin will assume financial responsibilities in the interim.

Amid uncertain market conditions, the U.K.-based homebuilder also disclosed a new strategy, focusing on shareholder returns. It involves the payment of an ordinary dividend of 33 pence for 2018 and 2019, subject to no material deterioration in market conditions, and the generation of a cash reserve in an attempt to prioritize cashflow and dividends, the company said in its latest trading update.

In addition, Crest Nicholson said it was suspending its plans for growth to align with the current market environment, slowing the pace of build rates and reducing land expenditure to preserve the value of its land and development pipeline.

As part of the adjusted strategy, Crest Nicholson took measures to reduce costs and increase hurdle rates. The company launched its new core housing range, with the aim of applying it to 50% of sites within three years. Its implementation is expected to drive efficiency savings in a number of areas, the company added.

Crest Nicholson shut down its London division and deferred the opening of its new South East division.

Executive Chairman Stephen Stone will lead the business in the implementation of the new strategy, alongside Bergin.

The homebuilder expects to log a pretax profit for the year ending Oct. 31 in the range of £170 million to £190 million, subject to the timing of completion of some transactions. The company's pretax profit amounted to £207 million in the previous fiscal year.