Barratt Redrow Shares Plunge as H1 Profit Disappoints

Shares of Barratt Redrow (LON: BTRW) plummeted over 7% today after the release of its 26-week results for the period ended December 28, 2025.

The initial market reaction appears to stem from concerns over adjusted operating profit, which missed expectations despite a resilient performance in a subdued housing market.

The company reported adjusted operating profit, before purchase price allocation (PPA) adjustments, of £210.2 million, a slight decrease of 0.3% compared to the £210.8 million adjusted aggregated operating profit in the comparable period. The operating margin contracted to 8.0% from 8.9%A and 9.3%R in HY25. This dip in profitability, even a minor one, has rattled markets, prompting the sell-off.

Adjusted profit before tax and the impact of PPA adjustments also saw a decline, coming in at £199.9 million, 13.6% below the £231.4 million reported in the prior year. However, statutory profit before tax showed a significant increase to £156.2 million (HY25: £113.4mR and £85.0mA), reflecting reduced costs from the Redrow transaction and integration.

Despite the profit headwinds, Barratt Redrow demonstrated resilience in home completions, delivering 7,444 total homes, 4.7% ahead of the 7,107 aggregated total home completions in the comparable period. This indicates sustained operational activity despite challenging market conditions. The company also boasts a strong balance sheet, holding net cash of £173.9 million after dividends and share buybacks.

A key highlight from the report is the progress on the Redrow integration, which is reportedly on track to deliver £100 million in cost synergies. The company is also seeing strong progress on revenue synergy sites through planning approvals. The successful integration of Redrow is crucial for Barratt Redrow to unlock future growth and efficiencies.

Current trading figures show a net private weekly reservation rate of 0.59 from December 29, 2025, to February 1, 2026, slightly below the 0.60 recorded in the previous year. Forward sales at February 1, 2026, stood at 11,168 homes, valued at £3,407.8 million, compared to 10,903 homes valued at £3,350.3 million the prior year.

The company maintains its guidance for total home completions of 17,200-17,800 in FY26, including approximately 600 joint venture completions. Barratt Redrow anticipates full-year adjusted profit before tax and the impact of PPA adjustments to be within the current range of consensus estimates.

Chief Executive of Barratt Redrow plc, David Thomas, commented: “During the first half we delivered a resilient performance in a subdued market while making strong progress integrating Redrow. As that integration nears completion, our focus is on disciplined execution. We are embedding our proven operating model across the enlarged group, delivering operational excellence, strengthening efficiency, and positioning Barratt Redrow to deliver volume growth, margin progression, and capital returns through the cycle.”