Ewloe based Redrow says too early to tell if Brexit will impact sales.
Ewloe-based Redrow Homes shares appear to be bouncing back after taking an initial post-Brexit battering on the markets since the end of last week.
At one point on Friday they had fallen by 77% however at the close of play on Monday they had pinged back but still 30% down on Thursday.
The company put out a trading statement this morning saying it is too early to tell whether Brexit will have any effect on future sales however, the company does expect to deliver on its profit target.
The statement says:
“In the run up to the EU referendum there was no impact on house sales or visitor levels. Although it is too early to tell whether Brexit will have any effect on future sales, initial feedback is that sites remain busy, reservations continue to be taken and, indeed, we witnessed long queues and strong reservations at new sites launched last weekend. The fact remains that there is a long term underlying demand for new homes following decades of under supply. This chronic shortage of housing leaves market fundamentals unchanged.
The new homes market remained strong throughout the period as the mortgage market continued to improve. The value of private reservations achieved for the year, driven by strong regional growth, was a record £1.56bn, up 46% on 2015 (£1.07bn). The Private Order Book at the end of June 2016 is £807m, up over 50% on June 2015. The sales rate for the financial year was 0.68 per week, in line with the previous year. The number of active outlets at the year end increased to 128 (2015: 117) in line with previous guidance.
In Central London, the developments at Commercial Street and Amberley Waterfront are now completed and significant progress has been made at Holland Park Avenue and Connaught Place, where just a handful of plots remain. All other London developments, including the Croydon Joint Venture, have sold either in line with or exceeding management expectations. Indeed, at Colindale, in just a few months the order book has reached £116m, including a 211 unit sale to L&Q.
As a result of the Group’s strong sales position, turnover for the financial year totalled a record £1.38bn, 20% up on 2015 (£1.15bn). The number of homes legally completed increased by 17% to 4,716 (2015: 4,022), with private completions increasing by 12% to 3,882 (2015: 3,451). The Average Selling Price of private homes was £328,500 (2015: £297,300).
The combination of higher than expected turnover and favourable payment terms on land purchases has resulted in a closing net debt position of £139m, a 10% reduction on 2015 (£154m).
The Group will publish its results for the year to June 2016 on 6 September 2016.”
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