In the last financial year Redrow's Scottish business generated 185 legal completions, had a turnover of £31m and made a small loss.
“The board has concluded that although we have had a presence in Scotland for a number of years, the operation there is not of sufficient scale to generate acceptable returns and its preferred option is to sell that business,” the company said. “An information memorandum will be issued shortly to interested parties and we would hope to conclude a sale in the coming months.”
Redrow’s strategy has been to move more upmarket, with its New Heritage Collection, and focus more on London and the southeast. Both steps contribute to achieving increased selling prices and the strategy appears to bearing fruit.
In a trading update for the first 16 weeks of 2011, Redrow said that sales activity had been ‘encouraging’, with sales per outlet averaging 0.70 sales per week, up from 0.65 per week at the start of 2010.
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Net private reservations for the financial year to date are up 2% to 1,819 (2010: 1,778). Private order book at 17 April stood at £139m, 6% up on the £131m of this time last year. Legal completions for the full year are expected to be marginally ahead of last year.
Although house prices have been stable for more than a year, Redrow’s average selling has seen ‘a healthy growth’, mainly due to New Heritage Collection. Further growth is expected from the new focus on London and the southeast.
Redrow said that sales per outlet were at the top end of industry comparables and reservations since the beginning of January were ahead of last year. Final results are expected to “show further significant progress”.
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