Barratt Redrow slashes dividend as housing market slows in 2024
Barratt Redrow has cut its dividend after reporting a slowdown in the housing market during the first half of its financial year. The company's shares dropped as it reduced payouts from 5.5p to 5p, reflecting weaker demand and economic uncertainty. Despite this, the firm remains on track to meet annual profit forecasts.
The housebuilder delivered 7,444 home completions in the six months to 28 December. For the full year, it expects between 17,200 and 17,800 completions. Revenue rose by 10.5% to £2.63 billion, though adjusted pre-tax profits fell by 13.6% to £199.9 million.
Adjusted operating profit stayed almost flat at £210.2 million. The company also submitted 56 planning applications covering 16,985 plots, with another 103 applications pending. Private reservation rates improved slightly, rising from 0.55 to 0.59 per site per week.
Cost savings from the Redrow merger are progressing as planned, with Barratt still targeting £100 million in synergies. However, analysts like Richard Hunter of Interactive Investor pointed to political instability and affordability issues as key challenges for buyer confidence.
Barratt Redrow anticipates full-year profits of between £558 million and £618 million, depending on spring sales. The dividend cut and profit dip highlight ongoing pressures in the common housing sector. Yet, the firm continues to expand its land bank and push ahead with planning applications.
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