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Builders and building materials

Barratt Redrow backs profit outlook after solid first half

Barratt Redrow PLC reported a steady first half, with performance broadly in line with its pre-Budget update and the full-year outlook maintained.

Adjusted operating profit was £210.2 million, broadly flat year on year, while adjusted profit before tax fell 13.6% to £199.9 million. Net cash stood at £173.9 million.

For the full year, profits are expected to be within the current range of consensus estimates of £558-617 million, with the full out-turn dependent on sales activity through the spring selling season.

Based on the current forward sold position of 11,168 homes at a value of £3.4 billion, and solid reservation activity, completed sales of 17,200-17,800 are expected, in line with previous guidance.

The group delivered 7,444 home completions in the half-year to 28 December, up 4.7% on the total a year earlier. This is slower than the 7.9% growth reported in November.

Underlying net private reservation rates for the half year were 0.55 per site per week, but current trading from 29 December to 1 February showed the rate picked up to 0.59, closer to the 0.60 seen a year earlier.

Cost synergies from the Redrow deal have also progressed, with delivery said to be in line with the full £100 million goal.

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