Redrow' s (RDW) full-year results to June provided further evidence of the rude health of the housebuilding sector, delivering record profits and a doubling of the final dividend to 4p.
Turnover breached the £1bn mark for the first time ever, with houses sold up 12 per cent to over 4,000. The return on capital employed was up from 18 per cent to 22.8 per cent, while margins at the operating level rose from 15.9 per cent to 18.5 per cent, exceeding its 2017 target of 18 per cent two years ahead of schedule.
Cost inflation on the input side was running at around 5 per cent, but this was more than offset by a 13 per cent rise in average selling prices to £270,000. Land prices, meanwhile, were broadly benign, and the company acquired 5,892 plots, taking the total land bank to 18,216.
Trading since the year-end remains robust, with the forward order book running at record levels. Private reservations secured in the first 10 weeks of the new financial year were 28 per cent ahead of last year's comparable period.
Analysts at broker Peel Hunt are forecasting EPS of 50.3p in 2016, compared with 44.5p in 2015.
| REDROW (RDW) | ||||
|---|---|---|---|---|
| ORD PRICE: | 494p | MARKET VALUE: | £1.83bn | |
| TOUCH: | 494-496p | 12-MONTH HIGH: | 502p | LOW: 249p |
| DIVIDEND YIELD: | 1.2% | PE RATIO: | 11 | |
| NET ASSET VALUE: | 230p | NET DEBT: | 18% | |
| Year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2011 | 453 | 25 | 4.4 | nil |
| 2012 | 479 | 43 | 9.7 | nil |
| 2013 | 605 | 69 | 14.6 | 1 |
| 2014 | 864 | 133 | 28.3 | 3 |
| 2015 | 1,150 | 204 | 44.5 | 6 |
| % change | +33 | +53 | +57 | +100 |
Ex-div: 24 Sep Payment: 13 Nov | ||||
