Barratt Redrow (LON:BTRW) Announces Quarterly Earnings Results

Key Points

• FY 2027 home-completion guidance was maintained at 17,500–17,900 homes, supported by resilient reservations and a 6% increase in forward sales, though average outlet guidance was reduced due to planning delays.
• Adjusted pre-tax profit declined to £572.8 million and the operating margin fell to 9.9% as weaker pricing, higher incentives and build-cost inflation offset volume growth.
• The balance sheet improved to a £61.4 million net surplus, with £400 million of planned FY 2027 capital returns, but legacy building-safety obligations remain a major cash burden, including expected payments of about £300 million in FY 2027.

Barratt Redrow (LON:BTRW - Get Free Report) announced its quarterly earnings results on Wednesday. The company reported GBX 26.10 earnings per share (EPS) for the quarter, Digital Look Earnings reports. Barratt Redrow had a return on equity of 2.73% and a net margin of 3.60%.

Here are the key takeaways from Barratt Redrow's conference call:

• FY 2027 completion guidance was maintained at 17,500–17,900 homes, supported by resilient underlying reservations and a 6% increase in the forward sales position. However, average outlet guidance was reduced to approximately 405 because of delays in planning approvals.
• The Redrow integration is complete, with the full £100 million cost-synergy target confirmed. The company expects the annual profit-and-loss contribution from synergies to rise to approximately £95 million in FY 2027, while dual- and triple-branded developments are showing encouraging sales rates.
• Adjusted pre-tax profit fell to £572.8 million, while the adjusted operating margin declined to 9.9% as softer underlying pricing, higher incentives, and build-cost inflation outweighed volume growth. Build-cost inflation is expected to run at 3%–4% in FY 2027.
• The balance sheet strengthened to a £61.4 million net surplus, and the company plans total FY 2027 capital returns of £400 million, including £386 million through share buybacks. Net cash at FY 2027 year-end is expected to be £400 million–£500 million, subject to land activity.
• Legacy building-safety obligations remain a significant cash burden, with a total provision of £1.05 billion and expected direct remediation and fund payments of approximately £300 million in FY 2027 and £450 million in FY 2028. The embedded land-bank gross margin also fell to 17.3% amid weaker pricing, cost inflation, and increased incentives.

Barratt Redrow Price Performance

Barratt Redrow stock opened at GBX 303.45 on Wednesday. Barratt Redrow has a one year low of GBX 235.40 and a one year high of GBX 410.29. The business has a fifty day moving average price of GBX 302.26 and a 200-day moving average price of GBX 281.63. The firm has a market capitalization of £4.20 billion, a P/E ratio of 20.37 and a beta of 1.37.

Analyst Ratings Changes

Several analysts have recently issued reports on the stock. Jefferies Financial Group reiterated a "hold" rating and issued a GBX 303 target price on shares of Barratt Redrow in a research note on Wednesday, August 12th. Berenberg Bank reiterated a "buy" rating and issued a GBX 348 price objective on shares of Barratt Redrow in a research note on Thursday, July 16th. Royal Bank Of Canada reissued an "outperform" rating and set a GBX 350 target price on shares of Barratt Redrow in a research report on Thursday, July 16th. Citigroup lowered Barratt Redrow to a "buy" rating in a report on Wednesday, July 22nd. Finally, JPMorgan Chase & Co. cut their price objective on Barratt Redrow from GBX 520 to GBX 350 and set an "overweight" rating on the stock in a research report on Tuesday, June 16th. Eight investment analysts have rated the stock with a Buy rating and two have given a Hold rating to the stock. Based on data from MarketBeat.com, Barratt Redrow presently has an average rating of "Moderate Buy" and a consensus price target of GBX 373.10.

Insider Activity

In other news, insider Geeta Nanda bought 1,701 shares of the stock in a transaction on Wednesday, July 22nd. The shares were acquired at an average cost of GBX 294 per share, for a total transaction of £5,000.94. Insiders own 0.31% of the company's stock.

About Barratt Redrow

Barratt Redrow plc is an exceptional FTSE 100 listed UK home builder, building the homes the country needs, and dedicated to quality, service and sustainability. Together, we offer a range of highly respected and complementary brands, Barratt, David Wilson and Redrow. We put our customers at the heart of everything we do, through our focus on: ✅ Quality - We deliver high-quality, energy-efficient homes which are built to the highest standards. Together, we have held more NHBC Pride in the Job Awards than any other housebuilder, for 20 years.