THE Bournemouth-based retirement housing developer McCarthy & Stone has unveiled a major cost-cutting drive under a new boss.

The company, which has seen a slowdown in sales, said it would look to make savings of more than £40million a year by 2021.

A shift in strategy will be spearheaded by John Tonkiss, who has been made permanent chief executive following a stint as interim boss.

He will shift focus from growth to increased returns on investment and improving profit margins.

Under his watch, McCarthy & Stone will “realign” workflow to deliver “steady state volumes” of 2,100 homes per year across two core products – Retirement Living and Retirement Living Plus.

Mr Tonkiss said: “We are positioning the business to succeed in the current challenging market environment and over the next three years, we will be focusing on increasing shareholder returns by optimising our operations to deliver strong financial performance.

“In parallel, we will also aim to leverage our longer term strategic opportunity to increase our customer appeal, diversify our revenue streams and reduce our exposure to the market cyclicality.”

McCarthy & Stone, which was founded in Bournemouth in 1977, said earlier this month that it had faced a “tough year”. Profits for the 12 months ended on August 31 were likely to come in at £65million-£73m, compared with £96m the year before – even though revenue rose from £661m to £670m.

Mr Tonkiss said the company would focus on reducing its building costs, and was also looking at how to make its homes more appealing to consumers, with more affordable prices and a wider range of tenure options.

The company employs around 170 people in Holdenhurst Road, Bournemouth, and another 60 at its southern regional base in Ringwood.