Redrow optimistic about recovery

Housebuilder Redrow said half year revenues rose ten per cent, despite a challenging market, and is cautiously optimistic its recovery is set to continue.

Housebuilder Redrow said half year revenues rose ten per cent, despite a challenging market, and is cautiously optimistic its recovery is set to continue.

Pre-tax profit rose to £23.0m for the six months to December 31st 2012 from £15.3m the same time a year earlier. Revenue for the period increased to £257.0m from £232.8m.

Pre-exceptional operating profit jumped to £26.2m during the half year from £17.4m. Adjusted EPS rose to 4.8p from 3.7p.

Legal home completions increased to 1,202 from 1,168 while the private average selling price rose to £224,000 from £204,000 previously.

Chairman Steve Morgan commented: "The backdrop remains challenging, but the stability of the housing market, the gradual improvement in both the planning environment and the mortgage market, together with our distinct focus on our high-quality, differentiated family housing range has meant that we have continued to make good progress."

"We applaud the Government's attempts to improve the market through the NewBuy, extension of FirstBuy, and Funding for Lending schemes and if the current trend in reduction of mortgage rates continues, it will undoubtedly assist in the housing market's gradual return to more normalised conditions."

Underlining its confidence in future trading, Redrow expects to propose to a modest final dividend at the year-end.

Net debt reduced to £65.2m from £98.8m. Volume of private net reservations rose 24% and in the first eight weeks of 2013 climbed 8% to 443.

Morgan added: "We have started the second half well...given the strong pipeline of new sites and the modest improvement in market conditions, I am cautiously optimistic that Redrow's strong recovery is set to continue."

CJ

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