Redrow showed further signs of recovery in the six months to December, and the housebuilder now has the land, product range and regional coverage to deliver strong profits growth. Chairman Steve Morgan inherited a mess when he returned to the group in 2009 and Redrow is now on a much sounder footing, with profits up sharply and operating margins rising from 5.6 per cent to 7.5 per cent, although the lack of a dividend means there is better value elsewhere in the sector.
Much of the improvement comes from a continued roll-out of the New Heritage Collection of houses, which now accounts for 60 per cent of the turnover generated from private sales, double the year before, and now features on more than 70 per cent of all development sites. The group has continued to shift towards building more family homes and less apartments, with the former now making up 90 per cent of group turnover. So, while legal completions fell from 1,312 to 1,168 – partly as a result of the sale of its Scottish business – average selling prices on private homes rose from £171,000 to £204,000.