Redrow on solid foundations as profit in first half builds up to record £176m

● Says reservations in the first five weeks of the second half in line with last year

Housebuilder Redrow has hailed record results after higher selling prices and a jump in completions helped revenues and profits surge.

The group, which sold its Scottish operations to Elginbased Springfield Properties in 2011, chalked up a 26 per cent rise in half-year pre-tax profits to a record £176 million, while revenues climbed by a fifth to £890m over the period.

The stellar performance was underpinned by a 14 per cent rise in legal completions to 2,811, with the average selling price lifting 9 per cent to £330,000.

Order books were also bright, rising 5 per cent to £1.1 billion for the six months ending in December.

Redrow chairman Steve Morgan said the company was on track to meet its growth targets thanks to the robust sales market and strong order books.

He told investors: “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.”

Operating profits proved strong over the six-month period, lifting 22 per cent to £175m, as land holdings rose 6 per cent to 27,600 plots.

Redrow, which was founded in North Wales in 1974, boosted its dividend per share by 50 per cent to 9p in response to its “strong earnings performance”.

Henry Croft, research analyst at Accendo Markets, said: “This record-breaking performance comes against a continued back-drop of Brexit uncertainty for UK housebuilders, and at odds with a number of peers who failed to see generally positive results releases be rewarded with an accompanying share price reaction.

“Given Redrow’s smaller position in the market compared with bigger brothers Barratt Developments, Persimmon and Taylor Wimpey, the company can afford to bolster growth through increasing completions and stands out as one of the only housebuilders consistently improving this metric by double digits.”

Accendo does not have a rating or target price on Redrow.