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Redrow reports swell in revenue growth to record 54%

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  • 11/02/2015
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Redrow reports swell in revenue growth to record 54%
Redrow has reported record results from its residential and commercial business in the last six months of 2014, almost doubling to £560.6m from £363m in same period last year.

The housebuilder achieved its growth of 54% through a combination of rising sale prices on private homes and the government’s Help to Buy scheme.

Pre-tax profits were up 92% to a half year record of £91.2m, a significant upswing on previous interim results of £47.5m.

Average prices of Redrow’s residential properties jumped to £300,000 in the six months ending December 2014, an increase of 14% on 2013. Total legal completions grew by 18% to 1,850, compared to 1,565 six months earlier, with private legal completions climbing by 30%.

The rise in legal completions on sales was due to a mix of particularly concentrated sales in London and the south of England and house price inflation, it said.

While regional business sales increased on the first half of 2014, reservations in London dropped from 138 to 24 compared to a year earlier, due to sites being almost completely sold out in the capital.

As a result, the total value of private reservations in the first half of the firm’s financial year was 7% below last year, at £449m.

Orders on its private books were up 30% at £334m with a total of 16,950 plots on its land bank at the end of December, 700 more than the same time last year. Redrow said it plans to add a further 1,000 plots to its sites.

Steve Morgan, chairman of Redrow, said its strategy of retaining capital to focus on growth helped the property developer achieve record results.

“As a result of this strong performance, while we continue first and foremost to invest in the ongoing growth of the business, we have also doubled the interim dividend to 2p per share. Whilst we are only at the beginning of the spring selling season, demand for new homes is strong and the welcomed changes to Stamp Duty will undoubtedly help home buyers within our market segment.

“We started the second half with a very strong order book and are expecting to increase the number of active outlets to 115 by June 2015, a 12% increase. Redrow is in great shape and I am confident this will be another strong year of growth for the business,” he added.

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