Record opening six months for Redrow

The Deeside-based housebuilder said it would increase the amount of cash returned to shareholders after posting record first-half sales and profits from selling 2,200 homes in the six months to the end of December 2015.

Pre-tax profit was £104m from revenue of £603m, up from £91m and £560m in the same period the previous year. The return on capital employed was 21%, the same as a year earlier. The dividend will be doubled to 4p from last year. A final dividend of 6p is proposed.

Net debt at 31 December was £183m (June 2015: £154m) giving gearing of 20% (June 2015: 18%). Legal completions rose 18% to 2,178 (2015: 1,850). The average number of outlets increased to 121 (2015: 101). Redrow employs 1,818 people, three times the level of 2009.

The current land bank is enough to supply 21,435 plots compared to 16,950 one year ago.

Steve Morgan, chairman of Redrow, said: “We are only at the beginning of the spring selling season, however demand for new homes remains robust. We ended the first half with a record order book up 51% on this time last year, and in the first six weeks of the second half have secured 455 private reservations, 10% ahead of last year. I am confident this will be another strong year of growth for Redrow.”

Shares in Redrow fell more than 3% to 406p.