23rd Oct 2024 08:40
(Alliance News) - Barratt Redrow PLC on Wednesday noted a continued significant imbalance between housing supply and demand as it began "to see more stable market conditions" in the housebuilding sector.
The Leicestershire, England-based housebuilder, now in an "exciting new chapter" with the tie-up of Barratt Developments and Redrow now in force, warned it may still take some time for consumer confidence to recover.
The company gave an update for the time between the start of its first financial quarter on July 1, and October 13, as it held its annual general meeting.
Between July 1 and October 13, Barratt standalone had 305 average active sales outlets, down 17% from 369 between July 1 and October 15 in 2023.
"Long-term housing market fundamentals continue to reflect a significant imbalance between housing supply and demand. The new government has demonstrated that it is committed to improving the planning system and addressing funding challenges in the affordable housing sector. Whilst these supply-side reforms will also take some time to be fully implemented, we are confident that they will help to unlock permissioned land supply and the delivery of more high-quality, sustainable homes across the country," Barratt Redrow said.
The company expects at least GBP90 million of cost synergies following the GBP2.52 billion acquisition of Redrow in August, a smaller housebuilding peer. It anticipates revenue synergies from 45 incremental sales outlet openings through until financial year 2028.
The outlook for the standalone Barratt operations are unchanged. It expects annual home completions there, including joint-ventures, between 13,000 and 13,500. For the whole Barratt Redrow group, completions are expected to be between 16,600 and 17,200.
For financial 2024, Barratt Developments had reported 14,004 home completions, down 19% from 17,206 in financial 2023.
Barratt Redrow shares rose 3.6% to 490.20 pence each on Wednesday morning in London.
By Tom Budszus, Alliance News slot editor
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