Dividend delight but Redrow boss Steve Morgan still pans the system
Wednesday 18 September 2013
Redrow boss Steve Morgan today added another £1.5 million to his £500 million fortune as the housebuilder reinstated the final dividend in the wake of soaring annual profits.
Morgan, the 40% shareholder and founder who failed in a bid to take the company private last year, steered it to a 63% rise in pre-tax profits to £70 million in the year to June 30.
But the Wolverhampton Wanderers owner could not resist another swipe at a planning system hampering efforts to build more homes to meet demand inspired by the Government’s Help to Buy scheme: “At a strategic level, planning has got better with the presumption in favour of sustainable development but at the front end, it is like running through treacle.”
Redrow spends 25% more on planning than bricks but has nearly 17,000 plots on 99 sites currently locked in the planning system. Only a minority of these will be ready to build on in the next year. The firm is selling from 93 sites compared with 84 last year but Morgan adds: “This is about outlets. If you don’t speed up planning, then you work through available outlets more quickly. If you are going to speed up the level of build in this country you need to speed up the process.”
The chairman warned: “The message from me is the last thing we want is big price increases. If prices kept up with inflation, we would be extremely happy. But if we don’t increase supply demand will drive up the price.”
Redrow’s revenues rose 26% to £604.8 million last year but is gearing up for a “significant increase” in output this year — including in the capital — as it takes on more debt to buy up land.
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