Redrow (RDW) delivered another impressive year of growth, but it may be the last as a publicly-quoted company if a potential bid to take the company private by founder and chairman Steve Morgan is successful. We’ll know soon enough, because Bridgemere - a company controlled by Mr Morgan and which controls 40.4 per cent of the shares - has until 28 September to make a firm offer, indicated at 152p a share.
Mr Morgan rejoined Redrow in 2009 and since then has been busy turning round the housebuilding group. The latest financial results highlight just how much progress has been made with average selling prices on private homes up 17 per cent to £204,100 and greater use of cheaper land and an increase in sales outlets, up from 74 to 82, lifting operating margins from 7.5 per cent to 10 per cent. So although completions were only marginally ahead of the prior year, these two factors meant operating profits soared 55 per cent to £48m. More progress can be expected as Redrow builds its presence in London where two sites are already under construction. Excluding the Capital, the order book on private homes is currently up a third at £152m on this stage last year.
Peel Hunt expects 2013 adjusted pre-tax profits of £49.7m and EPS of 10.1p.
| REDROW (RDW) | ||||
|---|---|---|---|---|
| ORD PRICE: | 152p | MARKET VALUE: | £562m | |
| TOUCH: | 150-152p | 12-MONTH HIGH: | 156p | LOW: 100p |
| DIVIDEND YIELD: | nil | PE RATIO: | 16 | |
| NET ASSET VALUE: | 152p | NET DEBT: | 2% | |
| Year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2008 | 650 | -193.9 | -65.8 | 7.09 |
| 2009 | 302 | -140.8 | -47.9 | nil |
| 2010 | 397 | 0.7 | 0.2 | nil |
| 2011 | 453 | 25.3 | 4.4 | nil |
| 2012 | 479 | 43.0 | 9.7 | nil |
| % change | +6 | +70 | +120 | - |
