Redrow Plc Business History and Valuation

Redrow Plc has a rich history dating back to 1974, when it was founded by Steve Ford in Northwich, Cheshire.

The company started out as a small, family-run business, but has since grown into a leading UK housebuilder.

Redrow Plc's early success can be attributed to its focus on quality and customer satisfaction, which has remained a core part of its business model to this day.

Today, the company is a FTSE 250 listed business, with a market capitalization of £2.1 billion.

Redrow plc has a diverse and experienced management team. Matthew Pratt serves as the Chief Executive Officer, a position he has held since June 30, 2020.

The company's management team includes several key members. Bethany Ford has been a Corporate Officer/Principal since August 31, 2017, but her age is not publicly disclosed. Karen Jones has been a Human Resources Officer since July 31, 1997, also with her age not publicly disclosed.

Matthew Pratt is not only the CEO but also a Director/Board Member, a role he has held since March 31, 2019. He is 50 years old, which is the same age as the company's CEO. Steven Boyes and Michael Scott are also Directors/Board Members, with ages 65 and 48 respectively.

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Redrow plc's net sales have fluctuated over the years, ranging from 2.14B to 10.82B. In 2023, their net sales were 2.13B.

Their profitability is also noteworthy, with a profit margin of 3.34% and a return on assets of 2.41% in the trailing 12 months. This indicates that for every pound invested, they generate 2.41p in profit.

Their revenue has consistently been around 5.58B in the trailing 12 months, while their net income available to common stockholders has been 186.4M in the same period. This suggests a stable financial performance.

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Analysts' Recommendations play a significant role in shaping investor decisions.

Redrow plc has seen its fair share of upgrades and downgrades from various analysts.

JPMorgan upgraded Redrow to Neutral from Underweight, with a lifted price target. This change was announced on April 12, 2022.

Berenberg downgraded Redrow to Hold from Buy, but also lifted the price target. This change was announced on March 22, 2022.

RBC downgraded Redrow to Sector Perform from Outperform. This change was announced on March 21, 2022.

Jefferies downgraded Redrow to Hold from Buy, and also lowered the price target. This change was announced on February 8, 2022.

Here are the recent analyst recommendations for Redrow plc:

Financial performance is a crucial aspect of any company's overall health. The numbers can be overwhelming, but let's break down the key points.

Net sales have been fluctuating over the years, with the highest recorded at $4.37B in one year and the lowest at $256B in another.

Revenue has been steadily increasing, reaching $5.58B at one point. This suggests that the company is expanding its customer base and growing its market share.

The company's profitability is another important metric. The profit margin has been around 3.34%, indicating that for every dollar earned, the company keeps about 33.4 cents.

The return on assets (ROA) and return on equity (ROE) have been relatively stable, with ROA at 2.41% and ROE at 2.80%. These metrics suggest that the company is using its assets and equity efficiently.

Here's a summary of the company's financial performance:

The company's net debt has been increasing, with a high of -$56.02B at one point. This suggests that the company has taken on significant debt to finance its operations and growth.

Redrow plc has a rich history that spans over five decades. The company was founded in 1974 by Steve Morgan, who borrowed £5,000 from his father to take over a contract with Wellington Civil Engineering.

Redrow started out as a civil engineering company but gradually expanded into house building, with its first house construction project launched in 1982. By 1985, the company's house building activities had grown significantly, leading to the separation of the construction business.

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In the 1990s, Redrow continued to grow and expand, with the company being floated on the London Stock Exchange in 1994. Steve Morgan reduced his stake in the company to 33% in 1997, and by 2000, he had announced his intention to leave the company.

Redrow recorded a record profit of £141 million in 2005, and its 50,000th customer was welcomed in 2006. However, the company faced challenging trading conditions during the late 2000s, including a halving of house sales in 2008.

Redrow plc has had its fair share of changes in leadership. Matthew Pratt stepped down as CEO, effective 30 June 2025.

Redrow plc has undergone significant board changes. Geeta Nanda stepped down as a non-executive director, and Oliver Tant also stepped down from the same position.

In 2024, Redrow plc delisted from the London Bourse after a merger with Barratt. This move had significant implications for the company's listing status.

Here's a summary of Redrow plc's delisting:

Steve Morgan's entrepreneurial spirit was sparked in 1974 when he took over a contract from Wellington Civil Engineering after the company decided to close.

He borrowed £5,000 from his father to complete the contract at a profit, demonstrating his determination and business acumen.

Morgan registered his new company, Redrow, at just 21 years old, marking the beginning of his successful journey as a businessman.

Redrow initially focused on small civil engineering work, gradually expanding its operations into Cheshire and eventually making significant construction acquisitions in Manchester and the Wirral.

By 1982, Redrow had started constructing houses, and by 1985, its housing activities had grown sufficiently to be separated from the construction business.

The company continued to expand, forming a south-east housing operation in Kent and a Midlands-centric housing subsidiary in 1986.

Redrow's housing sales soared to over 1,000 houses per year by 1987, after buying Whelmar Lancashire from Christian Salvesen.

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The 2000s was a decade of significant growth and change for Redrow. In 2005, they recorded a record profit of £141 million, a seven per cent rise over the previous year.

This was followed by a milestone in 2006, when Redrow saw its 50,000th customer.

However, the late 2000s brought extremely difficult trading conditions, including a halving of house sales in the latter part of 2008.

Redrow made efforts to reduce its debt burden, aiming to get it below £255 million by the mid-point of 2009.

Steve Morgan returned to Redrow in March 2009, increasing his shareholding to just under 30 percent.

The company's efforts to recover were ultimately unsuccessful, and in October 2009, Redrow announced the worst fiscal results in its history, including a 53 per cent drop in revenue and a pre-tax loss of £140.8 million.

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In the 2010s, Redrow launched its Heritage Collection, Regent Collection, and Abode Collection. The company's Scottish activities were sold off to Springfield Properties in exchange for £49 million.

Redrow's profits doubled in 2012, a remarkable achievement that showcased the company's growth and success. That same year, Steve Morgan endeavored to take over ownership of Redrow, although no conclusive offer was ever issued.

John Tutte became Redrow's chief executive on June 30, 2014, marking a significant shift in the company's leadership. Redrow achieved a record profit of £104 million in early 2016, despite a downturn in the inner London market.

In February 2017, Redrow acquired Radleigh Homes in Derby, an established company that delivered 200 new homes in 2016. The acquired company was later re-branded as Redrow Homes (East Midlands).

The 2020s were a transformative time for Redrow, marked by significant challenges and opportunities.

In 2020, the COVID-19 pandemic led to a temporary closure of most Redrow sites in the UK, causing a third decline in house sales.

Redrow completed 4,032 homes by June 2020, compared to 6,443 in 2019, and turnover was expected to be £1.34bn against £2.11bn in 2019.

The company took this opportunity to review its divisions and scaled back its London operations to focus on its Colindale Gardens development.

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Redrow partnered with Liverpool John Moores University to offer a degree in Construction Management to outside applicants, which was previously only available to its employees.

Over 800 applications were received for this degree program.

In 2021, Richard Akers became Redrow's non-executive chairman, and the company announced a new Southern division to expand its reach to Surrey and Sussex.

This new division was opened in May 2022.

Redrow joined the UNFCCC Race to Zero and signed up to the Science Based Targets initiative (SBTi) in 2021, supporting efforts to limit global warming to 1.5°C.

In 2022, Redrow was included in the FT-Statista annual climate leaders list of companies achieving the greatest reductions in their Scope 1 and 2 greenhouse gas emissions intensity over a five-year period (2015-20).

The company was also admitted to the FTSE4Good Index, for demonstrating strong Environmental, Social and Governance (ESG) practices.

Redrow became one of the first house builders to implement the New Homes Quality Board's new code of practice in October 2022.

In January 2023, Redrow became the first large housebuilder to introduce air source heat pumps in all its upcoming developments, moving away from traditional gas boilers.

Underfloor heating would be provided as standard in its detached homes.

In February 2024, Redrow was among eight UK house-builders targeted by the CMA in an investigation into suspected breaches of competition law.

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Redrow plc is a leading UK homebuilder with a strong presence in the industry. The company operates in a competitive market, with a number of established players vying for market share.

Redrow's main competitors include Barratt Developments, Persimmon, and Taylor Wimpey. These companies are all well-established players in the UK homebuilding market.

Redrow's focus on quality and customer satisfaction has helped the company to differentiate itself from its competitors. This approach has contributed to the company's success and reputation.

The company's focus on building high-quality homes has helped it to gain a strong reputation among customers.

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Redrow plc's valuation measures indicate a significant difference between its market capitalization and enterprise value. The market capitalization stands at 7.51B, while the enterprise value is 6.55B.

The forward P/E ratio of 13.62 suggests that investors expect the company to grow at a rate that justifies its current price. This is lower than the trailing P/E ratio of 30.01, indicating a potential undervaluation.

Here are some key valuation metrics for Redrow plc:

The company's enterprise value to revenue ratio is 0.87, indicating that its revenue is generating a significant portion of its enterprise value.

Valuation Measures are a crucial aspect of evaluating a company's stock. They provide a snapshot of the company's financial health and help investors make informed decisions.

Market Capitalization, also known as Market Cap, is a key valuation measure that represents the total value of a company's outstanding shares. In the case of one company, the Market Cap is 7.51B.

Enterprise Value, on the other hand, is a broader measure that includes the company's debt and cash. For this company, the Enterprise Value is 6.55B.

The Price-to-Earnings (P/E) ratio is another important valuation measure that compares a company's stock price to its earnings per share. A low P/E ratio can indicate that a stock is undervalued, while a high P/E ratio may suggest that it's overvalued. In 2022, the P/E ratio for this company was 30.01.

Here are some key valuation measures for a few companies:

The PEG Ratio, or Price-to-Earnings-to-Growth Ratio, is a more nuanced measure that takes into account a company's expected growth rate. A lower PEG Ratio can indicate that a stock is undervalued relative to its growth prospects. For this company, the PEG Ratio is 0.41.

The Price-to-Sales (P/S) ratio is another valuation measure that compares a company's stock price to its revenue. A low P/S ratio can indicate that a stock is undervalued, while a high P/S ratio may suggest that it's overvalued. For this company, the P/S ratio is 1.00.

The Price-to-Book (P/B) ratio is a valuation measure that compares a company's stock price to its book value. A low P/B ratio can indicate that a stock is undervalued, while a high P/B ratio may suggest that it's overvalued. For this company, the P/B ratio is 0.72.

In conclusion, valuation measures provide a comprehensive snapshot of a company's financial health and help investors make informed decisions. By analyzing these measures, investors can gain a deeper understanding of a company's strengths and weaknesses.

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Sales by Geography is a crucial aspect of Redrow's business, and it's interesting to see how their sales have fluctuated across different regions.

The UK is the primary market for Redrow, accounting for the majority of their sales. According to the data, the UK generated £2.11B in sales during the 2019 fiscal period, which decreased to £1.34B in 2020.

In 2021, UK sales rebounded to £1.94B, and by 2022, they had reached £2.14B. The 2023 fiscal period saw a slight dip to £2.13B.

Here's a breakdown of Redrow's UK sales over the years: