Record figures in UK-based construction company Redrow’s first-half 2017 financial results were said to be in line with its growth strategy.
Pre-tax profit reached a record level of £315 million (€344 million) in the first half of 2017, which represented a 26% increase on the equivalent 2016 figure. In the same period, operating profit was also up 23% to £322 million (€352 million), from £261 million (€285 million) in the first six months of 2016.
Another record figure was Redrow’s order book, which stood at £1.1 billion (€1.2 billion) at the end of June 2017, up 14% from £967 million (€1.06 billion) at the end of June 2016.
Revenue rose by 20% in the first half of the year to £1.66 billion (€1.81 billion), from £1.38 billion (€1.51 billion) in the first half of 2016. This was said to have been driven by the higher number of legal completions, which rose by 15% from 4,716 in the first half of 2016 to 5,416 in the same period this year, and a 7% increase in the average selling price to £309,800 (€338,486).
The company’s operating margin rose to 19.4% in the first six months of the year, from 18.9% in the first six months of 2016.
Net debt was reduced from £139 million (€152 million) at the end of June 2016 to £73 million (€80 million) at the end of June 2017.
Steve Morgan, Chairman, said, “Our growth strategy has delivered record financial results for the fourth consecutive year.”
He added, “Redrow has continued to build much-needed new homes across England and Wales with completions up 15% to over 5,400.”
The company has also increased its number of outlets from 128 in 2016 to 132 in 2017, and its number of employees has risen by 12% over the same period.
These results have given Morgan confidence that this year will be one of significant progress for Redrow.
He said, “Based on the strength of our current performance and the robust demand that we are seeing, we are today updating our medium-term guidance. We now expect turnover in 2020 of around £2.2 billion (€2.4 billion) and pre-tax profit of around £430 million (€469 million).”