Covid-sized leak in roof for Redrow

The Daily Telegraph - Business - - Business - Louis ash­worth

SHARES in house­builder Redrow took a hit as the group warned on trad­ing and an­nounced plans to beat a re­treat from Lon­don. Fol­low­ing a re­view of its divi­sional busi­nesses, the FTSE 250 group will scale back its op­er­a­tions in the cap­i­tal to tar­get fu­ture growth in its re­gional op­er­a­tions.

It warned site clo­sures prompted by Covid 19 have had a “pro­found im­pact” upon its re­sults, pre­dict­ing its turnover for the the year to the end of June will be £1.24bn, down from £2.11bn the pre­vi­ous year. “The prospects for the wider econ­omy and its im­pact upon the new homes mar­ket re­mains un­cer­tain,” the group warned in an up­date to the City yes­ter­day.

“De­spite this, as lock­down re­stric­tions have eased, trad­ing has been en­cour­ag­ing, driven by high cus­tomer de­mand for Help to Buy as more buy­ers look for sup­port as the mort­gage mar­ket and econ­omy re­cov­ers.”

Citi an­a­lysts trimmed their es­ti­mates for the group fol­low­ing the up­date. Ami Galla said the ad­just­ment re­flected “a slow con­struc­tion ramp-up and, more ma­te­ri­ally, the one-off costs from the scale-back of op­er­a­tions in Lon­don”. The group dropped 31.6p to 430.8p, leav­ing it is the sec­ond-worst per­former on the FTSE 250.

It was beaten only by Petropavlo­vsk, which tanked 19pc, drop­ping 5.9p to 25.1p. The gold min­ing com­pany, which is fo­cused on as­sets in Rus­sia’s far east, was thrown into fresh lead­er­ship tur­moil af­ter say­ing the vot­ing process at its an­nual gen­eral meet­ing was “nei­ther trans­par­ent nor fair to share­hold­ers”.

On the FTSE 100, which closed out its best quar­ter since 2010 with a poor day’s trad­ing, Smiths Group was the big­gest riser. It climbed 114p to £14.12 af­ter un­veil­ing re­struc­tur­ing plans that it said would in­clude “some job losses”. It re­ported a “re­silient over­all per­for­mance” over the past four months, which is said re­flected mo­men­tum and strong or­der book com­ing into the cri­sis. Jef­feries’ Sandy

Mor­ris called the up­date “very re­silient”, but cau­tioned the group faces “some nearer-term ad­di­tional chal­lenges”.

Sev­eral heavy­weight fall­ers kept the in­dex un­der­wa­ter for nearly the en­tire ses­sion. Royal Dutch Shell dropped 46.8p to £12.24 af­ter warn­ing it may take a hit of up to $22bn due to the oil price crash. Its fall weighed on peer BP, which dropped 7.7p to 307.2p. It had risen on Mon­day af­ter an­nounc­ing plans to sell its petro­chem­i­cal busi­ness to Sir Jim Rat­cliffe’s Ineos for $5bn.

HSBC was an­other an­chor on blue chips, drop­ping 6.2p to 378.6p af­ter China adopted a se­cu­rity law as part of a crack­down in Hong Kong.

Out­side eq­ui­ties, yields on two-year gilts hit a new record low of -0.114pc dur­ing the day, while gold fu­tures broke through $1,800 an ounce for the first time in eight years.

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