Barratt Redrow’s first-half revenue rose by 11% to £2.6bn. The growth was largely driven by a 5% rise in total completions to 7,444 new homes and a 4% rise in average selling prices to £365,000.
Underlying pre-tax profits fell by 14% to £200mn (consensus: £205mn), as higher use of buyer incentives weighed on margins.
Free cash flow fell by £0.1bn to £0.3bn. Net cash fell by £0.3bn to £0.2bn largely due to an increase in inventories, but is expected recover to £0.4-0.5bn year-end.
Full-year guidance has been reiterated, with the group expecting to complete between 17,200-17,800 new homes this year. Full-year underlying pre-tax profits are expected to rise around 21% to £590mn (consensus £597mn).
An interim dividend of 5.0p per share was announced, down from 5.5p.
The shares fell 5.0% in early trading.
Our view
HL view to follow.
Barratt Redrow key facts
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This article is original Hargreaves Lansdown content, published by Hargreaves Lansdown. It was correct as at the date of publication, and our views may have changed since then. Unless otherwise stated estimates, including prospective yields, are a consensus of analyst forecasts provided by LSEG. These estimates are not a reliable indicator of future performance. Yields are variable and not guaranteed. Investments rise and fall in value so investors could make a loss.
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