Redrow set for '˜excellent' year as record profits defy Brexit fears

Housebuilder Redrow brushed aside fears over the Brexit vote as it posted another record annual profit haul and predicted an 'excellent' year ahead.

Shares in the Flintshire-based group surged as much as 8% after it revealed pre-tax profits jumped 23% to £250 million in the year to June 30 - hailed as a “knock-out” set of results in the City.

Redrow said it had seen “very little impact” from the vote to leave the European Union, with private legal completions surging by 12% and average prices up 7% to £288,600.

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It added that sales in the first 10 weeks since its year-end were up 8%.

Founder and chairman Steve Morgan - who until recently also owned Wolverhampton Wanderers football club - said the results marked its third year in a row of record profits.

Mr Morgan, who sold Wolves to Chinese conglomerate Fosun International in July, said the central London property market had been “sluggish”, but stressed it had little exposure to the capital, which has suffered more of a hit from the referendum as well as April’s stamp duty hike.

A trading update from rival Berkeley Group on Tuesday revealed the woes in London as it said reservations fell around 20% in August, although it added that the market had stabilised after a spike in cancellations in the weeks surrounding the Brexit vote.

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Figures from Nationwide Building Society last week showed UK house prices rose 0.6% month on month in August to reach a new record of £206,145 - up 5.6% year on year.

Despite recent reports that housing market activity has slowed, Nationwide said the rates of price growth accelerated in August.

Redrow chief executive John Tutte said the past financial year had been “excellent” for the company.

He added: “The group is in good shape and well-positioned for the future. I am confident 2017 will be another excellent year for the business.”

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Redrow’s results showed overall legal completions rising by 17% to 4,716, boosted by the Government’s Help to Buy schemes.

It also hired an extra 300 people over the year, taking its total workforce to just under 2,000.

Neil Wilson, markets analyst at ETX Capital, said Redrow delivered a “knock-out set of annual results”, adding that its bullish outlook “catches the eye”.

“Indeed, entering the new financial year with a record private order book of £807 million, which is up 54% from a year ago, the firm has every right to be optimistic,” he said.

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