- FY25 profit tops forecasts
- Home completions lag
- Limited growth in FY26
Housebuilder Barratt Redrow (BTRW) gave with one hand and took with the other in its latest annual results, beating market forecasts for pre-tax profit and raising the full-year dividend but cautioning against an upturn in the current financial year.
The shares initially popped nearly 10p or 2.7% to 376p but buying petered out leaving the stock just 2p higher at 368p by mid-morning.
STILL A TOUGH MARKET
Total home completions for the year to the end of June were 16,565, below market expectations and last year’s aggregated figure of 17,972 units including the legacy Redrow group.
Adjusted pre-tax profit before PPA (purchase price allocation) adjustments was £592 million, above last year’s figure of £586 million and the consensus forecast of £583 million.
Chief executive David Thomas described the results as ‘a solid performance in a tough market,’ adding ‘while the housing market remains challenging, and we anticipate limited growth in FY26, the long-term fundamentals of the sector remain compelling’.
Thomas said Barratt Redrow had a ‘clear strategy to deliver long-term, sustainable growth’ and 22,000 homes a year, and urged the government to focus on reforming the planning system, ‘removing barriers to investment, and supporting purchasers, particularly first-time buyers’.
Since the end of June, net private weekly reservations – an industry measure used to estimate future demand – were slightly lower than in the same period last year, with no private rental sector or multi-unit sales registered.
Based on reservations to date, the firm expects to deliver between 17,200 and 17,800 completions in the year to June 2026, although it cautioned uncertainty around the Budget, in particular regarding taxation and how it applies to housing, had introduced additional risk during the autumn selling season.
There was a small comfort for shareholders in the shape of a higher full-year dividend, and the planned £100 million share buyback for FY26 is ongoing.
