Barratt Redrow (BTRW) H1 2025 earnings summary

Executive summary

• Delivered 6,846 home completions in H1 FY25, up 10.9% year-over-year, with revenue rising 23.2% to £2,280.8m; adjusted profit before tax reached £167.1m, up 6.4% year-over-year, and Redrow integration is progressing ahead of upgraded £100m synergy targets.

• Interim dividend increased by 25% to 5.5p per share, reflecting confidence in outlook; share buyback programme of at least £100m per annum initiated, with £50m planned for H2.

• Net private weekly reservation rate increased to 0.60, with forward sales value up 5.3% to £3,018.4m.

• No incremental building safety remediation costs charged in H1; reported profit before tax was £117.2m, up 23.1% year-over-year.

• Robust demand and stabilised inflation underpin confidence in full-year delivery.

Financial highlights

• Revenue increased 23.2% year-over-year to £2,280.8m; adjusted gross profit at £338.7m (up from £295.9m), with adjusted gross margin at 14.9% (down 110bps year-over-year).

• Adjusted profit before tax before PPA adjustments was £217.5m; PPA adjustments reduced reported profit by £50.4m.

• Net cash at period end was £458.9m after £170.5m dividend and £46.5m remediation spend.

• Adjusted basic EPS dropped 21.2% to 9.3p due to increased share count post-acquisition.

• ROCE declined to 8.1% from 12.8% year-over-year, reflecting lower profitability.

Outlook and guidance

• FY25 home completions expected between 16,800–17,200 (including ~600 JV completions); affordable mix to be in the high teens.

• Adjusted PBT (excluding PPA) expected towards the upper end of consensus (£506m–£588m); year-end net cash forecast at £0.5bn–£0.6bn.

• Land spend for FY25 guided at £0.9bn–£1.0bn.

• Dividend cover to move from 1.75x to 2.0x adjusted earnings from FY26; ongoing £100m annual share buyback programme.

• Operating margin targeted to recover to ~15% and ROCE to ~20% medium term; annual home completions to reach ~22,000.