13th Sep 2023 09:23
(Alliance News) - Redrow PLC on Wednesday reported a surge in annual profit, but said it expects a plunge in revenue and profit in its next financial year.
The Ewloe, Wales-based housebuilder said pretax profit in the financial year ended July 2 climbed 61% to GBP395 million from GBP246 million, due to "cost inflation exceeding house price inflation".
Revenue fell slightly by 0.5% to GBP2.13 billion from GBP2.14 billion a year prior, but the firm noted it was "stable due to the increase in average selling price that was already embedded in the order book".
Redrow lowered its final dividend per share by 9.1% to 20.0 pence from 22.0p year-on-year, bringing the company's full year dividend to 30.0p, down 6.3% from 32.0p.
Looking ahead, Redrow said the financial 2024 market is still "challenging" but is well-positioned to respond. It expects to generate lower revenue of between GBP1.65 billion to GBP1.70 billion in the next financial year, while pretax profit is expected at between GBP180 million and GBP200 million.
Chief Executive Officer Matthew Pratt said: "Cost of living and mortgage affordability continue to have a negative impact on the market. Where appropriate, we've used targeted sales incentives to convert buyer interest into reservations.
"Following several consecutive Bank of England base rate increases, we remain hopeful that, as inflation eases, we will see some stability in mortgage rates. The reduction in mortgage volatility will enable potential customers to progress the purchase of their home with financial certainty."
Shares in Redrow were up 3.8% at 490.84p each in London on Wednesday morning.
By Sabrina Penty, Alliance News reporter
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