Barratt Redrow PLC: A First Full Year as a Combined Group

Full-year results for the 52-week period ended 29 June 2025

Barratt Redrow PLC reported its maiden full set of annual results as a merged business on 17 September 2025, covering the 52-week period ended 29 June 2025. (The group reports on a 52-week financial calendar, so although the year is commonly described as ending "30 June," the formal period end was the last Sunday in June.) The results are the first to capture a full trading year of the enlarged group created by Barratt Developments' acquisition of Redrow plc, which completed in August 2024 and brought together three housebuilding brands — Barratt Homes, David Wilson Homes and Redrow — under one roof.

The headline message from management was one of resilience in a still-difficult housing market, with profits running ahead of City expectations even as completions landed slightly below the company's own guidance.

Headline numbers

Revenue rose 33.8% to £5,578.3 million, up from £4,168.2 million in the prior year, driven largely by the inclusion of a full year of Redrow's output. Total home completions, including joint ventures, increased 18.3% to 16,565, compared with 14,004 the year before.

On a statutory basis, profit before tax jumped 60.5% to £273.7 million from £170.5 million, and statutory basic earnings per share rose 15.3% to 13.6 pence. Statutory gross margin improved 190 basis points to 14.1%, and operating margin widened 90 basis points to 5.1%.

The group also leans heavily on adjusted measures, which strip out exceptional items, and — new this year — a set of figures presented "before PPA." PPA refers to purchase price allocation, the accounting exercise that revalues Redrow's assets and liabilities to fair value on acquisition; those fair-value uplifts then unwind through the income statement and depress reported profit in the early years after a deal.

Adjusted profit before tax was £488.3 million. Excluding the PPA impact of £103.3 million, adjusted profit before tax before PPA reached £591.6 million, up 26.8% on the prior year's £385.0 million. That figure was the one the market focused on, and it came in ahead of the Bloomberg consensus of £582.8 million. Adjusted gross margin before PPA was 17.4%, and adjusted operating margin before PPA was 10.7%.

A summary of the key metrics:

Metric (£m unless stated)FY25 (52 wks to 29 Jun 2025)FY24 (reported)ChangeTotal home completions16,56514,004+18.3%Revenue5,578.34,168.2+33.8%Statutory profit before tax273.7170.5+60.5%Adjusted profit before tax488.3385.0+26.8%Adjusted PBT before PPA591.6385.0—Statutory basic EPS13.6p11.8p+15.3%Adjusted basic EPS25.5p28.3p(9.9%)Net cash772.6868.5(11.0%)Dividend per share17.6p16.2p+8.6%Return on capital employed9.0%9.5%(50 bps)Tangible net asset value per share437p452p(3.3%)

Balance sheet and shareholder returns

The group closed the year with net cash of £772.6 million, down about 11% from £868.5 million a year earlier, reflecting land investment, integration costs and significant cash spend on building-safety remediation. The balance sheet remains a central pillar of the equity story, giving the company room to invest through the cycle.

Despite the dip in cash and a modest fall in tangible net asset value per share to 437 pence (from 452 pence), the board increased the total dividend by 8.6% to 17.6 pence per share, signalling confidence in the cash-generative nature of the combined business. Return on capital employed eased slightly to 9.0%.

It is worth noting the divergence between statutory and adjusted EPS. Statutory EPS rose, but adjusted basic EPS actually fell 9.9% to 25.5 pence — partly a function of the larger share count following the all-share Redrow acquisition and the drag from PPA. Before PPA, adjusted EPS was 30.8 pence.

The Redrow integration

The dominant strategic theme of the year was the absorption of Redrow. Chief Executive David Thomas described the acquisition as "transformative," noting that integration was largely complete and that cost synergies were running ahead of target. The combined group now markets three distinct brands aimed at different buyer segments: Barratt Homes for first-time buyers and younger families, David Wilson Homes for movers and growing families, and the more premium Redrow for upmarket purchasers and downsizers.

There was a notable boardroom change tied to the integration: Matthew Pratt, the former Redrow chief executive, stepped down from the board with effect from the close of business on 30 June 2025.

Building safety and other headwinds

Like its peers, Barratt Redrow continues to carry the cost of legacy building-safety remediation — the cladding and fire-safety work on older buildings that has weighed on UK housebuilders since the Grenfell tragedy. This remains a material cash outflow and one of the larger clouds over the otherwise solid picture. The group also flagged a soft London market and persistent affordability constraints, with elevated living costs and mortgage rates still limiting demand, particularly among first-time buyers.

Outlook for FY26

Management struck a cautious near-term tone, guiding to "limited growth" in the new financial year while reaffirming a medium-term ambition of 22,000 home completions a year. Specific FY26 guidance included total home completions of 17,200 to 17,800 (including around 600 from joint ventures), an affordable-housing mix of roughly 20%, build-cost inflation of about 1–2%, building-safety cash spend of around £250 million, and year-end net cash of £0.4 billion to £0.5 billion.

The group entered the new year with a forward order book that, as at 24 August 2025, stood at 10,350 homes with a value of £3,140.9 million.

Thomas tied the longer-term opportunity to government policy, arguing that planning reform, the removal of barriers to investment and support for buyers — especially first-time buyers — are essential if the sector is to build the homes the country needs.

The takeaway

This was a creditable first full year for the merged group: revenue and completions up sharply, statutory profit well ahead, profit before PPA beating consensus, a higher dividend and a still-strong balance sheet, all while digesting a major acquisition. The qualifiers are real, too — legacy building-safety costs, a subdued London market, softer adjusted EPS and only modest growth guided for the year ahead. For longer-term investors, the case rests on synergy delivery from the Redrow deal, an improving planning backdrop and disciplined land buying converting into the targeted 22,000 homes a year.

This article is based on Barratt Redrow plc's published full-year results announcement for the 52-week period ended 29 June 2025 and is provided for general information only. It does not constitute investment advice. Figures are taken from the company's results statement; the full annual report and accounts are available on the Barratt Redrow corporate website.