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Redrow PLC   -  RDW   

Interim Results

Released 07:00 06-Feb-2019

RNS Number : 1688P
Redrow PLC
06 February 2019
 

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE MARKET ABUSE REGULATION EU 596/2016. UPON PUBLICATION OF THIS ANNOUNCEMENT, THE INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN. THE INFORMATION CONTAINED IN THIS ANNOUNCEMENT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION.

 

FOR IMMEDIATE RELEASE

 

Wednesday 6 February 2019

 

 

Redrow plc

 

Interim results for the six months to 31 December 2018

 

 

ANOTHER RECORD FIRST HALF - STRONG EARNINGS

AND CASH PERFORMANCE UNDERPIN PROPOSED £111M CASH RETURN

TO SHAREHOLDERS

 

 

Financial Results

 

 

H1 2019

H1 2018

% Change

Legal Completions

2,970

2,646

12

Revenue

£970m

£890m

9

Operating Profit

£187m

£175m

7

Profit Before Tax

£185m

£176m

5

EPS

41.5p

39.5p

5

ROCE

28%

25%

12

Interim Dividend per share

10p

9p

11

Additional cash return per share

30p

-

N/A

Total Order Book

£1.162bn

£1.047bn

11

 

Financial Highlights

 

·      Group revenue rose 9% to a first half record of £970m

·      Record first half pre-tax profit of £185m, up 5%

·      Earnings per share (EPS) up 5% to 41.5p

·      Return on capital employed of 28% (2018: 25%)

·      Net cash of £101m (June 2018: £63m)

·      Interim dividend of 10p per share (2018: 9p)

·      Proposed additional cash return of 30p per share through a B Share Scheme representing £111m

 

Operational Highlights

 

·      Legal completions rose 12% to 2,970 (2018: 2,646)

·      Redrow completed its 100,000th home

·      Average number of outlets increased to 129 (2018: 127)

·      Total order book up 11% to a record £1.162bn (Dec 2017: £1.047bn)

·      Current land holdings in line with June 2018 at 27,500 plots

 

Steve Morgan, Chairman of Redrow, said

 

"In this, my final report as Chairman, it gives me great pleasure to announce that Redrow has once again delivered record results for the first half of the financial year. During the period legal completions increased by 12% to 2,970, whilst pre-tax profits were up 5% to £185m.

 

As a result of our continuing strong earnings and cash performance, we are proposing a 30p per share cash return to shareholders through a B Share Scheme, in addition to a 10p per share interim dividend. This Scheme enables all shareholders to participate equally in proportion to their holdings and should be treated as capital for most UK tax resident shareholders.

 

The market during the run up to the festive period and the first two weeks of 2019 was subdued by macroeconomic and political uncertainty. However, sales over the last three weeks have bounced-back with reservations running at similar levels to last year's strong market activity. Overall, private sales for the first 5 weeks of 2019 were £156m (2018: £166m). Nevertheless given our record £1.2 billion order book, our strategy remains on track giving me every confidence that this will be another year of significant progress for Redrow.

It is nearly 45 years since I founded Redrow and when I step down as Chairman next month it will be exactly 10 years since I returned to the business. I am proud of the legacy I leave behind having completed over 6,000 homes for the first time in 2018 and handed over our 100,000th Redrow home last October.

Redrow has a very strong team, an excellent balance sheet and the Heritage Collection product which I believe is the best in the industry. Most importantly, Redrow has a great future under John Tutte's leadership who will take over from me as Chairman."

 

Enquiries:

 

Redrow plc

 

Steve Morgan, Chairman                                             01244 527411

Barbara Richmond, Group Finance Director               01244 527411

 

Instinctif Partners                                                         0207 457 2020

 

Mark Garraway                                                            07771 860938

James Gray                                                                   07583 936031                                                   

 

There will be an analyst and investor meeting at 10.30 am at The London Stock Exchange, 10 Paternoster Square, London, EC4M 7LS. Coffee will be served from 10.00 am.

 

A live audio webcast and slide presentation of this event will be available at 10.30 am on www.redrowplc.co.uk. Participants can also dial in to hear the presentation live at 10.30 am on +44 (0) 20 3003 2666 or UK Toll Free 0808 109 0700; password is Redrow.

 

Playback will be available by phone for the next 30 days on +44 (0) 20 8196 1998 or UK Freephone 0800 633 8453; access pin 8438916#.

 

Chairman's Statement

 

In this, my final report as Chairman, it gives me great pleasure to announce that Redrow has once again delivered record results for the first half of the financial year. During the period legal completions increased by 12% to 2,970, whilst pre-tax profits were up 5% to £185m.

 

Financial Results

 

Group Revenue increased by 9% to £970m, due to the increase in legal completions. Revenue from private legal completions increased by 4% to £847m (2018: £816m) and from affordable completions was 97% higher at £114m (2018: £58m). The average selling price of our private homes increased by 4% from £375,000 to £391,000 and affordable homes by 15% to £141,000 (2018: £123,000), mainly due to the growth of the Southern businesses.

 

As a consequence of the change in balance of tenure, gross margin reduced slightly from 24.5% to 24%.

 

Overheads increased from £43m to £46m, due to the further growth in the business. However, as a percentage of turnover they reduced from 4.8% to 4.7%.

 

Operating profit increased by 7% to £187m (2018: £175m) and pre-tax profits were 5% higher at £185m (2018: £176m), despite there being no Joint Venture contribution this year (2018: £4m after tax). Earnings per share at 41.5p were 5% up on the previous year (2018: 39.5p).

 

Net cash at the end of December 2018 was £101m (June 2018: £63m).

 

In line with our policy of a 33% full year dividend payout ratio, the Board has declared an interim dividend of 10p per share (2018: 9p). The interim dividend will be paid on 9 April 2019 to holders of ordinary shares on the register at the close of business on 8 March 2019.

 

As a result of our continuing strong earnings and cash performance, we are proposing a 30p per share cash return to shareholders through a B Share Scheme, which will be in addition to the interim dividend. This Scheme enables all shareholders to participate equally in proportion to their holdings and should be treated as capital for most UK tax resident shareholders. Assuming it is approved by shareholders payment is expected to be made in April 2019. The Scheme will be accompanied by a share consolidation to maintain share price comparability.

 

Trading

 

Our sales rate per outlet per week for the first half was 0.61, slightly lower than the 0.64 for the same period last year. Sales were negatively affected towards the end of the calendar year as a result of the political uncertainty surrounding Brexit and the effect of high Stamp Duty Tax, which has disrupted the normal trade-up/down-sizing market. Despite this, the value of private reservations in the first half was in line with the prior year at £795m (2018: £795m).

 

At the end of December 2018 we had a record total order book of £1.2bn, up 11% on December 2017. In the first half of the financial year 39% of our private reservations utilised Help to Buy. Outlets averaged 129 in the period, two higher than the first half last year. We expect the full year average outlets to be at a similar level.

 

Over the period we have experienced a reduction in cost pressures with sub contract, materials and labour markets all easing.

I am delighted that our customer satisfaction scores have run at 91% over the last 12 months which should ensure Redrow's status as a 5 Star Builder under the Home Builders Federation Survey. I am also delighted that Redrow were awarded the coveted titles of Large Housebuilder of the Year and UK Housebuilder of the Year at the 2018 WhatHouse Awards.

 

Land and Planning

 

We continue to see excellent opportunities in the land market. However, we have taken a cautious approach to land acquisition, preferring to concentrate on those select sites which suit the Redrow product.

 

Our owned and contracted current land holdings at 31 December 2018 are in line with those at the end of the last financial year at 27,540 plots (June 2018: 27,630). Our forward land holdings at 31 December 2018 are also in line with those at the end of June at 30,500 (June 2018: 30,700).

People

 

Our directly employed workforce continued to increase due to the ongoing growth of the business.

 

Over the last 10 years, since I returned to Redrow, the then 600 employees has increased four-fold to just under 2,400 today. During that time we have recruited over 1,000 trainees into the business, ranging from apprentices to graduates.

 

We have an ongoing commitment to develop our own talent, leading the way in trying to resolve the shortage of skilled labour in the industry. Redrow is at the forefront of actively encouraging young people to develop successful careers across all disciplines.

 

I am proud of the Redrow team as we continue to grow the business and, as always, I thank them for their commitment.

 

Current Trading and Outlook

 

The market during the run up to the festive period and the first two weeks of 2019 was subdued by macroeconomic and political uncertainty. However, sales over the last three weeks have bounced-back with reservations running at similar levels to last year's strong market activity. Overall, private sales for the first 5 weeks of 2019 were £156m (2018: £166m). Nevertheless our strategy remains on track and given our record £1.2 billion order book, I have every confidence that this will be another year of significant progress for Redrow.

It is nearly 45 years since I founded Redrow and when I step down as Chairman next month it will be exactly 10 years since I returned to the business. I am proud of the legacy I leave behind having completed over 6,000 homes for the first time in 2018 and handed over our 100,000th Redrow home last October.

Redrow has a very strong team, an excellent balance sheet and the Heritage Collection product which I believe is the best in the industry. Most importantly, Redrow has a great future under John Tutte's leadership who will take over from me as Chairman.

Steve Morgan
Chairman

 

Consolidated Income Statement

 

 

Unaudited

Audited

 

 

6 months ended

31 December

12 months ended

30 June

 

 

2018

2017

2018

 

Note

£m 

£m 

£m 

Revenue

 

970

890

1,920

Cost of sales

 

 (737)

 (672)

 (1,451)

Gross profit

 

233

218

469

 

 

 

 

 

Administrative expenses

 

 (46)

 (43)

 (87)

Operating profit

 

187

175

382

 

 

 

 

 

Financial income

 

1

2

3

Financial costs

 

 (3)

 (5)

 (10)

Net financing costs

 

 (2)

 (3)

 (7)

Share of profit of joint ventures after interest and taxation

 

-

4

5

Profit before tax

 

185

176

380

 

 

 

 

 

Income tax expense

2

 (35)

 (33)

 (72)

Profit for the period

 

150

143

308

Earnings per share - basic

4

41.5p

39.5p

85.3p

                                 - diluted

4

41.4p

39.3p

85.2p

 

Consolidated Statement of Comprehensive Income

 

 

Unaudited

Audited

 

 

6 months ended

31 December

12 months ended

30 June

 

 

2018

2017

2018

 

Note

£m 

£m 

£m

Profit for the period

 

150

143

308

 

 

 

 

 

Other comprehensive (expense)/income:

 

 

 

 

Items that will not be reclassified to profit or loss

 

 

 

 

Remeasurements of post-employment benefit obligations

5

 (5)

6

22

Deferred tax on remeasurements taken directly to equity

 

1

 (1)

(4)

Other comprehensive (expense)/income for the period net of tax

 

 (4)

5

18

Total comprehensive income for the period

 

146

148

326

 

Consolidated Balance Sheet

 

 

Unaudited

Audited

 

 

As at

31 December

As at

30 June

 

 

2018

2017

2018

 

Note

£m 

£m 

£m

Assets

 

 

 

 

Intangible assets

 

2

2

2

Property, plant and equipment

 

15

16

15

Investments

 

6

19

6

Deferred tax assets

 

4

4

4

Retirement benefit surplus

5

16

4

22

Trade and other receivables

 

7

10

8

Total non-current assets

 

50

55

57

 

 

 

 

 

Inventories

6

2,258

2,154

2,218

Trade and other receivables

 

43

32

42

Cash and cash equivalents

8

102

49

90

Total current assets

 

2,403

2,235

2,350

 

 

 

 

 

Total assets

 

2,453

2,290

2,407

 

 

 

 

 

Equity

 

 

 

 

Retained earnings at 1 July 2018

 

1,379

1,131

1,131

Profit for the period

 

150

143

308

Other comprehensive (expense)/income for the period

 

 (4)

5

18

Dividends paid

 

 (70)

 (41)

(74)

Movement in LTIP/SAYE

 

1

1

(4)

Retained earnings

 

1,456

1,239

1,379

Share capital

10

37

37

37

Share premium account

 

59

59

59

Other reserves

 

8

8

8

Total equity

 

1,560

1,343

1,483

 

 

 

 

 

Liabilities

 

 

 

 

Bank loans

8

1

80

5

Trade and other payables

7

143

173

178

Deferred tax liabilities

 

4

3

5

Long-term provisions

 

9

8

9

Total non-current liabilities

 

157

264

197

 

 

 

 

 

Bank overdrafts and loans

8

-

4

22

Trade and other payables

7

702

642

671

Current income tax liabilities

 

34

37

34

Total current liabilities

 

736

683

727

 

 

 

 

 

Total liabilities

 

893

947

924

 

 

 

 

 

Total equity and liabilities

 

2,453

2,290

2,407

 

 

 

 

 

Redrow plc Registered no. 2877315

 

 

 

 

                 

 

Consolidated Statement of Changes in Equity

 

 

 

Share

 

 

 

 

Share

premium

Other

Retained

 

 

capital

account

reserves

earnings

Total

 

£m

£m

£m

£m

£m

 

 

 

 

 

 

At 1 July 2017

37

59

8

1,131 

1,235 

 

 

 

 

 

 

Total comprehensive income for the period

-

-

-

148 

148 

Dividends paid

-

-

-

(41)

(41)

Movement in LTIP/SAYE

-

-

-

At 31 December 2017 (Unaudited)

37

59

8

1,239

1,343

 

 

 

 

 

 

At 1 July 2017

37

59

8

1,131 

1,235 

 

 

 

 

 

 

Total comprehensive income for the period

-

-

-

326 

326 

Dividends paid

-

-

-

(74)

(74)

Movement in LTIP/SAYE

-

-

-

(4)

(4)

At 30 June 2018 (Audited)

37

59

8

1,379 

1,483 

 

 

 

 

 

 

At 1 July 2018

37

59

8

1,379 

1,483 

 

 

 

 

 

 

Total comprehensive income for the period

-

-

-

146 

146 

Dividends paid

-

-

-

(70)

(70)

Movement in LTIP/SAYE

-

-

-

At 31 December 2018 (Unaudited)

37

59

8

1,456 

1,560 

 

Consolidated Statement of Cash Flows

 

 

 

 

 

Unaudited

Audited

 

 

6 months ended

31 December

12 months ended

30 June

 

 

2018

2017

2018

 

Note

£m 

£m 

£m

Cash flows from operating activities

 

 

 

 

Operating profit

 

187

175

382

Depreciation and amortisation

 

1

1

3

Adjustment for non-cash items

 

 (1)

 (2)

(6)

Operating profit before changes in working capital and provisions

 

187

174

379

 

 

 

 

 

Decrease/(increase) in trade and other receivables

 

1

3

(5)

Increase in inventories

 

 (40)

 (111)

(175)

(Decrease)/increase in trade and other payables

 

 (3)

32

76

Increase in provisions

 

-

-

1

Cash inflow generated from operations

 

145

98

276

 

 

 

 

 

Interest paid

 

 (1)

 (2)

(4)

Tax paid

 

 (35)

 (32)

(74)

Net cash inflow from operating activities

 

109

64

198

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

Acquisition of software, property, plant and equipment

 

 (1)

 (1)

(2)

Interest received

-

3

-  

Net receipts from joint ventures

-

13

26

Net cash (outflow)/inflow from investing activities

 

 (1)

15

24

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

Issue of bank borrowings

 

1

80

5

Repayment of bank borrowings

 

 (5)

 (90)

(90)

Purchase of own shares

 

-

-

(12)

Dividends paid

3

 (70)

 (41)

(74)

Net cash outflow from financing activities

 

 (74)

 (51)

(171)

 

 

 

 

 

Increase in net cash and cash equivalents

 

34

28

51

Net cash and cash equivalents at the beginning of the period

 

68

17

17

Net cash and cash equivalents at the end of the period

8

102

45

68

               

 

NOTES (Unaudited)

 

1.       Accounting policies

 

Basis of preparation

 

The condensed consolidated half-yearly financial information for the half-year ended 31 December 2018 has been prepared on a going concern basis in accordance with the Disclosure and Transparency Rules of the Financial Conduct Authority and with IAS 34, 'Interim financial reporting' as adopted by the European Union. The half-yearly condensed consolidated report should be read in conjunction with the annual consolidated financial statements for the year ended 30 June 2018, which have been prepared in accordance with IFRSs as adopted by the European Union.

 

These half-yearly financial results do not comprise statutory accounts within the meaning of section 434 of the Companies Act 2006. These condensed half-yearly financial statements have been reviewed, not audited. Audited statutory accounts for the year ended 30 June 2018 were approved by the Board of Directors on 3 September 2018 and delivered to the Registrar of Companies. The report of the auditors on those accounts was unqualified, did not contain an emphasis of matter paragraph, and did not contain any statement under section 498 of the Companies Act 2006.

 

The principal accounting policies adopted in the preparation of this consolidated half-yearly report are included in the annual consolidated financial statements for the year ended 30 June 2018. The accounting policies are consistent with those followed in the preparation of the financial statements to the year ended 30 June 2018 with the exception of two new accounting standards which have been adopted by the Group from 1 July 2018.

 

IFRS 15, 'Revenue from contracts with customers' is a converged standard of IAS 18 'Revenue', IAS 11 'Construction Contracts' and a number of revenue-related interpretations from the IASB and FASB on revenue recognition. The standard is more prescriptive in terms of what should be included within revenue, and is effective for the year ending 30 June 2019.

 

The Group currently recognises revenue in respect of the sale of residential housing, residential land and of commercial land and developments on legal completion. This will not change under IFRS 15 as control on these, including for example revenue of housing association funded contracts for homes passes on completion of the finished units.

 

The Group does not currently recognise revenue on the proceeds from the disposal of properties taken in part exchange against a new home. The net profit or loss on disposal is shown within gross profit. The gross proceeds and net profit/loss are immaterial. This treatment will be unchanged under IFRS 15 as the Group considers properties taken in part exchange to be incidental to its main activity and therefore outside the scope of IFRS 15.

 

IFRS 9 'Financial instruments' replaces the guidance in IAS 39 and is effective for the year ending 30 June 2019. It affects the classification, measurement, impairment and de-recognition of financial instruments. The Group has reviewed its existing classification and confirmed that most financial assets will continue to be recognised at amortised cost, with other financial assets being classified at fair value through the profit or loss. The Group reviews the future recoverability of debtors, most of which is from housing associations which are government funded, in assessing exposure to expected credit loss. Given the nature of the receivables and lack of significant exposure to expected credit loss, the impact on Group profits of adopting IFRS 9 is immaterial.

 

There were no other key judgements or estimates made in assessing the impact of IFRS 15 and 9 on the Group.

 

The preparation of condensed half-yearly financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may subsequently differ from these estimates. In preparing these condensed half-yearly financial statements, the significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those that applied to the annual consolidated financial statements for the year ended 30 June 2018.

 

After making due enquiries and in accordance with the FRC's 'Going Concern and Liquidity Risk: Guidance for Directors of UK Companies 2009', the Directors have a reasonable expectation that the Group has adequate resources to continue trading for the foreseeable future. Accordingly, the Directors continue to adopt the going concern basis in preparing the condensed consolidated half-yearly financial statements.

 

The main operation of the Group is focused on housebuilding. As it operates entirely within the United Kingdom, the Group has only one reportable business and geographic segment. After considering the requirements of IFRS 15 to present disaggregated revenue, the Group does not believe there is any disaggregation criteria applicable to its one reportable business and geographic segment. There is no material difference between any assets or liabilities held at cost and their fair value.

 

Standards and interpretations in issue but not yet effective

 

IFRS 16 'Leases'. This standard replaces the current guidance in IAS 17 and is a far-reaching change in accounting by lessees in particular. Under IAS 17, lessees were required to make a distinction between a finance lease (on balance sheet) and an operating lease (off balance sheet). IFRS 16 now requires lessees to recognise a lease liability reflecting future lease payments and a 'right-of-use asset' for virtually all lease contracts. The IASB has included an optional exemption for certain short-term leases and leases of low-value assets; however, this exemption can only be applied by lessees. For lessors, the accounting stays almost the same. However, as the IASB has updated the guidance on the definition of a lease (as well as the guidance on the combination and separation of contracts), lessors will also be affected by the new standard. At the very least, the new accounting model for lessees is expected to impact negotiations between lessors and lessees. Under IFRS 16, a contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. Published January 2016, effective Annual periods beginning on or after 1 January 2019 with earlier application permitted if IFRS 15, 'Revenue from Contracts with Customers', is also applied. The Group has a number of operating leases, mainly in relation to cars and some office properties, which the Group currently anticipates will be required to be brought onto the balance sheet together with corresponding assets. The Group does not expect the net impact on profit to be significant.

 

Principal risks and uncertainties

 

As with any business, Redrow plc faces a number of risks and uncertainties in the course of its day to day operations.

 

The principal risks and uncertainties facing the Group are outlined within our half-yearly report 2019. We have reviewed the risks pertinent to our business in the six months to 31 December 2018 and which we believe to be relevant for the remaining six months to 30 June 2019. The only material changes to those outlined in our Annual Report 2018 are that economic uncertainty has increased with the possibility of a 'no-deal Brexit' and the risk of the withdrawal of the Help to Buy Scheme has receded with the extension of the scheme having been announced by the Government.

 

2.       Income Tax expense

 

Income tax charge is recognised based on management's best estimate of the weighted average annual income tax rate expected for the full financial year (19.0% (2018: 19.0%)).

 

3.       Dividends

 

A dividend of £70m was paid in the six months to 31 December 2018 (six months to 31 December 2017: £41m).

 

4.       Earnings per ordinary share

 

The basic earnings per share calculation for the six months ended 31 December 2018 is based on the weighted number of shares in issue during the period of 362m (31 December 2017: 362m) excluding those held in trust under the Redrow Long Term Incentive Plan, which are treated as cancelled.

 

Diluted earnings per share has been calculated after adjusting the weighted average number of shares in issue for all potentially dilutive shares held under unexercised options.

 

6 months ended 31 December 2018 (Unaudited)

 

 

       Earnings

No. of shares

  Per share

 

 

            £m

millions

     Pence

Basic earnings per share

150

         362

41.5  

 

Effect of share options and SAYE

            -

             1

(0.1)

 

Diluted earnings per share

150

         363

41.4  

 

                 

 

6 months ended 31 December 2017 (Unaudited)

 

 

       Earnings

No. of shares

  Per share

 

 

            £m

millions

     Pence

Basic earnings per share

143

         362

39.5  

 

Effect of share options and SAYE

            -

             2

(0.2)

 

Diluted earnings per share

143

         364

39.3  

 

                 

 

12 months ended 30 June 2018 (Audited)

 

 

       Earnings

No. of shares

Per share

 

 

            £m

millions

   pence 

Basic earnings per share

308

         361

85.3  

 

Effect of share options and SAYE

            -

             1

(0.1)

 

Diluted earnings per share

308

         362

85.2  

 

                 

 

5.       Pensions

 

The amounts recognised in respect of the defined benefit section of the Group's Pension Scheme are as follows:

 

 

 

Unaudited

Audited

 

 

6 months ended

31 December

12 months ended

30 June

 

 

2018

2017

2018

 

 

£m 

£m 

£m

Amounts included within the consolidated income statement

 

 

 

 

Period operating costs

 

 

 

 

Scheme administration expenses

 

1

-

-

Net interest on defined benefit liability

 

-

-

-

 

 

1

-

-

 

 

 

 

 

Amounts recognised in the consolidated income statement

 

 

 

 

of comprehensive income

 

 

 

 

Return on scheme assets excluding interest income

 

 (5)

4

5

Actuarial gains arising from change in financial assumptions

 

-

2

11

Actuarial gains arising from change in demographic assumptions

 

-

-

1

Actuarial gains arising from experience adjustments

 

-

-

5

 

 

 (5)

6

22

 

 

 

 

 

Amounts recognised in the consolidated balance sheet

 

 

 

 

Present value of the defined benefit obligation

 

 (112)

 (127)

(111)

Fair value of the Scheme's assets

 

128

131

133

Surplus in the consolidated balance sheet

 

16

4

22

 

6.       Inventories

 

 

Unaudited

Audited

 

 

As at

31 December

As at

30 June

 

 

2018

2017

2018

 

 

£m 

£m 

£m

Land for development

 

1,460

1,376

1,439

Work in progress

 

723

715

712

Stock of showhomes

 

75

63

67

 

 

2,258

2,154

2,218

 

7.       Land Creditors    

          (included in trade and other payables)

 

 

Unaudited

Audited

 

 

As at

31 December

As at

30 June

 

 

2018

2017

2018

 

 

£m 

£m 

£m

Due within one year

 

244

209

209

Due in more than one year

 

143

173

178

 

 

387

382

387

 

8.       Analysis of Net Cash/(Debt)

 

 

Unaudited

Audited

 

 

As at

31 December

As at

30 June

 

 

2018

2017

2018

 

 

£m 

£m 

£m

Cash and cash equivalents

 

102

49

90

Bank overdrafts

 

-

 (4)

(22)

Net cash and cash equivalents

 

102

45

68

Bank loans

 

 (1)

 (80)

(5)

 

 

101

 (35)

63

9.       Bank facilities

 

At 31 December 2018, the Group had total unsecured bank borrowing facilities of £253m, representing £250m committed facilities and £3m uncommitted facilities.

 

The Group's syndicated loan facility matures in December 2022.

 

10.        Issued Share capital

 

 

Unaudited

Audited

 

 

As at

31 December

As at

30 June

 

 

2018

2017

2018

 

 

£m 

£m 

£m

Allotted, called up and fully paid ordinary shares of 10p each

 

37

37

37

 

 

 

Number of ordinary

 

 

shares of 10p each

 

 

 

 

As at 1 July 2018 and 31 December 2018

 

369,799,938

 

11.     Contingent Liabilities

 

Performance bonds, financial guarantees in respect of certain deferred land creditors and other building or performance guarantees have been entered into in the normal course of business.

 

12.     Related parties

 

Key management personnel, as defined under IAS 24 'Related Party Disclosures', are identified as the Executive Management Team and the Non-Executive Directors. Summary key management remuneration is as follows:

 

 

 

Unaudited

Audited

 

 

6 months ended

31 December

12 months ended

30 June

 

 

2018

2017

2018

 

 

£m 

£m 

£m

Short-term employee benefits

 

3

3

5

Share-based payment charges

 

1

1

3

 

 

4

4

8

 

Related party transactions were carried out with Steve Morgan during the period for a total consideration of £0.2m (2018: £0.2m) primarily relating to donations to The Steve Morgan Foundation.

 

The Group did not undertake any material transactions with Menta Redrow Limited or Menta Redrow (II) Limited.  The Group's loans to its joint ventures are summarised below:

 

 

 

Unaudited

Audited

 

 

As at

31 December

As at

30 June

 

 

2018

2017

2018

 

 

£m 

£m 

£m

Loans to joint ventures

 

4

14

4

 

13.     General information

 

Redrow plc is a public limited company incorporated and domiciled in the UK and has its primary listing on the London Stock Exchange.

 

The registered office address is Redrow House, St David's Park, Flintshire, CH5 3RX.

 

Financial Calendar

 

Interim dividend record date                                                                                                 8 March 2019

Interim dividend payment date                                                                                                9 April 2019

Announcement of results for the year to 30 June 2019                                                     5 September 2019

Final dividend record date                                                                                            20 September 2019

Circulation of Annual Report                                                                                        23 September 2019

Annual General Meeting                                                                                                6 November 2019

Final dividend payment date                                                                                          13 November 2019         

 

14.     Shareholder enquiries

 

The Registrar is Computershare Investor Services PLC. Shareholder enquiries should be

addressed to the Registrar at the following address:

 

Registrars Department

The Pavilions

Bridgwater Road

Bristol

BS99 6ZZ

 

Shareholder helpline: 0370 707 1257

 

Independent Review Report to Redrow plc

 

Report on the half-yearly report

 

Our conclusion

We have reviewed Redrow plc's half-yearly report (the "interim financial statements") in the half-yearly report of Redrow plc for the 6 month period ended 31 December 2018. Based on our review, nothing has come to our attention that causes us to believe that the interim financial statements are not prepared, in all material respects, in accordance with International Accounting Standard 34, 'Interim Financial Reporting', as adopted by the European Union and the Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom's Financial Conduct Authority.

 

What we have reviewed

The interim financial statements comprise:

 

·     the consolidated income statement and consolidated statement of comprehensive income for the period then ended;

·     the consolidated statement of cash flows for the period then ended;

·     the consolidated statement of changes in equity for the period then ended; and

·     the explanatory notes to the interim financial statements.

 

The interim financial statements included in the half-yearly report have been prepared in accordance with International Accounting Standard 34, 'Interim Financial Reporting', as adopted by the European Union and the Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom's Financial Conduct Authority.

 

As disclosed in note 1 to the interim financial statements, the financial reporting framework that has been applied in the preparation of the full annual financial statements of the Group is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union.

 

Responsibilities for the interim financial statements and the review

 

Our responsibilities and those of the directors

The half-yearly report, including the interim financial statements, is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half-yearly report in accordance with the Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom's Financial Conduct Authority.

 

Our responsibility is to express a conclusion on the interim financial statements in the half-yearly report based on our review. This report, including the conclusion, has been prepared for and only for the company for the purpose of complying with the Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom's Financial Conduct Authority and for no other purpose. We do not, in giving this conclusion, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.

 

What a review of interim financial statements involves

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making enquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures.

 

A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK) and, consequently, does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

 

We have read the other information contained in the half-yearly report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the interim financial statements.

 

PricewaterhouseCoopers LLP

Chartered Accountants

Manchester

5 February 2019

 

LEI Number:
2138008WJZBBA7EYEL28

 

Announcement Classification:
1.2: Half yearly financial report and audit reports/limited reviews

 


This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
 
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Interim Results - RNS