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Barratt Redrow PLC on Wednesday said it expects annual earnings at the upper end of market expectations amid signs of improving market conditions. In response, shares in the firm are 8.5% higher at 474.15 pence each in London on Wednesday morning. It is the best performing stock in the FTSE 100 which is up 0.2%. The Coalville, England-based housebuilder said the integration of Redrow is ‘progressing well’ with £100 million of cost synergies expected, £10 million ahead of the original target. Pretax profit improved 23% to £117.2 million in the 26 weeks to December 29 from £95.2 million a year earlier. Revenue rose 23% to £2.28 billion from £1.85 billion. Reported metrics are based on the reported performance of the Barratt Group in the comparable reporting period, and do not include Redrow, an acquisition sealed in August to form Barratt Redrow, the firm explained. Aggregated revenue, so including Redrow, amounted to £2.49 billion in the half year to December 31, 2023. Pretax profit totalled £186.9 million over that period. Chief Executive David Thomas said he is ‘pleased’ with the performance. ‘As the economic, political and lending environments have stabilised, there has been some recovery in customer demand and we have seen solid reservation activity since the start of January, building a strong forward sales position. ‘As a result, we now expect our full year adjusted profit before tax will be towards the upper end of market expectations.’ Barratt Redrow puts adjusted pretax profit consensus at £542 million, with a range between £506 million to £588 million. The firm reported total home completions of 6,846 up 11% from 6,171 a year prior. Looking further it ahead, it provided medium-term guidance for the newly combined group. It expects to deliver 22,000 homes per year in the medium-term, with the operating margin reaching around 15%. The operating margin in the half-year just ended was 5.0%, slipping from 5.3%. Barratt Redrow declared a 5.5 pence per share interim dividend, up 25% from 4.4p. The firm has refined its dividend cover to 2.0 times adjusted earnings from 1.75x from 2026. In addition, it is kicking off a share buyback programme which will return £100 million per year, starting with a £50 million portion in the second half of its financial year. Barratt Redrow said based on solid reservation activity since the start of January, it expects to deliver total home completions of between 16,800 and 17,200 in financial 2025, including around 600 joint venture completions. Copyright 2025 Alliance News Ltd. All Rights Reserved.
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