Redrow hits first-half record

The Deeside-headquartered housebuilder has reported a record trading period in its interim results for the six months to 31 December 2017.

Redrow said that group revenue rose 20% to £890m, its most successful half-year ever. Legal completions increased by 14% to 2,811 over the period, while pre-tax profits climbed by 26% to £176m.

The business has reduced net debt from £73m in June 2017 to £35m, while the £1bn order book of December 2016 has increased by 5%. The group is to pay a dividend of 9p per share, up from 6p in 2017.

Steve Morgan, chairman, said: “It gives me great pleasure to announce Redrow has again delivered record results, for the first half of the financial year,

“Reservations in the first five weeks of the second half have been in line with the strong comparable period last year. We entered the second half with a record order book, and customer traffic and sales remain robust.

“Given the strength of both our order book and land holdings, together with the robust sales market, our growth strategy remains on track. This gives me every confidence it will be another year of significant progress for Redrow.”

Help to Buy has been important for Redrow, with the group reporting that 40% of private reservations used the initiative.

Over the period concerned, Redrow added 4,315 plots to its current land holdings, 583 of which were transferred from ‘forward land’.

Taking into account eliminations and land sales, Redrow’s current land holdings increased by 1,500 plots to 27,600 while its forward land bank increased by 5,400 plots to 31,800.

As of 31 December 2017, the group had total unsecured bank borrowing facilities of £353m, representing £350m committed facilities and £3m uncommitted facilities.

In January, Redrow announced the launch of a housebuilding degree course in conjunction with Liverpool John Moores University and Coleg Cambria.

Morgan said: “The degree course demonstrates our commitment to tackle the skills shortage by both attracting new entrants to the industry and by developing the careers of those who work in the business.”

Projects Redrow is working on in the region include Oldham’s Counthill school site, a joint venture with Anwyl in Sandback and housing at Omega in Warrington. It is part of the Liverpool Housing Partnership with the city council and Liverpool Mutual Homes.

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Redrow homes are typical of the volme housebuilder type: small, expensive and cheaply built. Maybe we should think about nationalising house builders too?

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