Deeside based housebuilder Redrow sees profits slump by 66% due to pandemic but outlook is positive
Deeside based housebuilder Redrow has reported that profits slumped by two-thirds in the year to June after construction work and sales were impacted by the coronavirus pandemic.
Despite the result Chairman John Tutte said Redrow is “well-placed to deliver a robust performance” this financial year.
Redrow temporarily closed all our sales centres and construction sites at the beginning of the pandemic, “an orderly and phased return to construction only began in May” the company said.
That resulted in only 264 completions in the final quarter of the year compared to 2,345 in 2019.
As a consequence, turnover for the year was down by 37% to £1.34bn (2019: £2.11bn).
“The significantly reduced turnover combined with substantial cos. attributable to COVID-19 and impairments associated with the decision to scale back the London business, resulted in a loss in the second half and pre-tax profits reducing to £140m (2019: £406m) for the year.” the housebuilder said.
John Tutte, Executive Chairman of Redrow, said: “I am immensely proud of the way our team and the wider workforce responded to the COVID-19 crisis and continue to do so.
“I am also grateful to everyone associated with Redrow for their willingness to embrace our new ways of working that prioritise the health and wellbeing of our customers, employees, subcontractors and suppliers.”
“The COVID-19 pandemic had a profound impact upon the Group’s performance in the 2020 financial year but we entered the new financial year in a position of strength.”
“We have a record order book and brought forward very high levels of work in progress. This was due in part, to increased investment earlier in the year in anticipation of strong demand for the Help to Buy scheme ahead of changes to the scheme next year.”
“The Group is well-placed to deliver a robust performance. We have completed substantially more homes in the first few weeks of the new financial year than during the same comparable period last year whilst maintaining a record order book.”
“This, combined with reduced investment in London, will deliver strong operating cash flow over the corning months to support our regional growth plans and, subject to market conditions, allow dividend payments to resume in 2021.”
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