29th Apr 2014 07:41
LONDON (Alliance News) - Redrow PLC saw its shares jump Tuesday morning after the company said it benefited from a continuing positive sales market, resulting in increased reservations and the delivery of new homes from a higher number of outlets.
The housebuilder said that the positive sales market seen in 2013 continued into the new year, with the group operating from an average of 92 outlets in the period, up 12% from 82 last year, in line with the company's focus on increasing delivery on new homes to meet the elevated demand.
In an interim management statement for the 17 weeks from January 1 to April 25, Redrow reports a 17% rise in net reservations at 1,280, compared to 1,091 last year, resulting in a sales rate of 0.82 per outlet per week, up 5% on 2013.
The company also reports a rise in the average selling price of private reservations for the financial year-to-date, up 16% to GBP289,000 from GBP249,000 last year, mainly due to an increasing proportion of sales in London and the South East.
Redrow said the average selling price of private legal completions for the period came in at GBP272,000, up from GBP226,000 for the comparable quarter. Legal completions in London are progressing well, said the company, with the division expected to contribute GBP120 million of turnover in the current financial year.
The cancellation rate remains similar to the first-half at 12%, compared to 15% last year.
The housebuilder said it has secured 11 further sites since the half-year, comprising of 1,300 plots and it has agreed terms on a "significant" number of other opportunities. "The Government's announcement of the extension of the Help to Buy scheme to 2020 provides a stable platform to increase our investment in new sites and grow our output," said the firm.
In February the FTSE 250-listed firm announced that it would pay its first interim dividend in six years, after recording a 107% increase in pretax profit for its recent half-year, underpinned by an improved UK housing market. Redrow posted pretax profit of GBP47.5 million for the period ended December 31, 2013, up from GBP23.0 million a year earlier, and a 41% rise in revenue to GBP363.0 million from GBP256.0 million in 2012.
Looking ahead, the firm said Tuesday it expects to show further good progress for the full-year.
Shares in Redrow were trading 2.76% higher at 286.2 pence per share Tuesday morning, one of the biggest gainers on the FTSE 250.
By Alice Attwood; [email protected]; @AliceAtAlliance
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