StockMarketWire.com - Housebuilder Redrow said revenues rose 8% to £232.8m in the half-year to end-December, driven an increase in average selling prices and margins.

Private ASPs were up 19% to £204,000.

Gross margin increased to 15.4% (2011: 13.4%) as a result of the change in mix of both land and homes.

Operating margin increased from 5.6% to 7.5%.

Profit before tax up 80% to £15.3m (2011: £8.5m).

EPS (adjusted) up 85% at 3.7p (2011: 2p).

NAV per share increased to £1.50

Net debt increased as expected to £98.8m as a result of continued investment in land (Dec 2010: £51.5m), giving gearing of 21% (Dec 2010: 12%).

Private net reservations up 15% to £180m and private order book up 14% to £82m (excluding Scotland).

Sale of the Scottish business impacted legal completions, down 11% in the first half.

Continued focus on ROCE leading to an increase to 6.4% (2011: 4.9%).

The New Heritage Collection comprised over 60% of private turnover (2011: 30%) and now features on over 70% of developments (2011: 50%).

Redrow one of two major housebuilders achieving HBF 5 Star Customer Satisfaction accreditation. Customer satisfaction levels at 95%

Redrow said the second half of the year has started encouragingly with the value of private net reservations in the first seven weeks of 2012 up 11% to £69m.

Steve Morgan, Chairman, said: 'Redrow has again delivered a strong set of results with a significant improvement in performance against the backdrop of a challenging marketplace. When I returned to the business in 2009 my first priority, after putting the company on a sound financial footing, was to return Redrow to its traditional focus of a high quality differentiated family housing product, where the overwhelming market demand lay. These results today show that our change of strategy is paying off with the New Heritage Collection going from strength to strength and Private ASPs of circa £200,000. At the same time, return on capital employed, a key metric for us, has increased further to 6.4%.

'While the outlook for the industry undoubtedly remains fragile there is increasing confidence in the housing market, including first time buyers. This should be helped further when the availability of 95% mortgages kicks in under the NewBuy scheme at the end of March.

'We believe that we are well positioned for the future and the second half has started encouragingly with the value of private reservations up 11% to £69m and with a strong portfolio of sites in the pipeline. Provided we can overcome the delays in the planning system and short of a crisis in the Eurozone damaging confidence Redrow is set to continue along our path of recovery.'



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