But building defects push up total provision to £1.4bn, casting shadow on strong performance
Barratt Redrow has recorded increased turnover and profit in its first results since merging, but provisions also rose after the discovery of new building defects.
The pair completed their £2.5bn merger last October after securing clearance from the Competition and Markets Authority.
In its full-year results for the 52 weeks to 29 June 2025, published this morning, the housebuilding giant reported revenue of £5.58bn, up 33.8% from £4.17bn in the year ended 30 June 2024.
It also recorded pre-tax profit of £274m, up 60.5% from £171m.
The firm also offered adjusted pre-tax profit figures, which it said would allow for “the assessment of the performance of the combined group”, before purchase price allocation adjustments. This number was up 27% from £385m to £488m.
The firm completed 16,565 homes, compared with 14,004 in the previous period. However, this was below previous guidance, which predicted between 17,200 to 17,800 completions.
The housebuilder has a strategy to grow to be a 22,000-home-a-year builder in the medium term.
It also announced that it had achieved £69m worth of cost synergies following the merger, against its target of at least £100m.
This resulted in a £20m reduction in costs through the income statement in FY25 profit, with a further incremental cost reduction of £45m expected in next year’s results.
Six divisional offices were closed in the year and three more are in the process of closing. IT integration in six divisions constitutes most of the remaining post-merger integration processes to complete.
The group’s total provisions rose in the year to £1.37bn from £921m, with new costs relating to concrete frame defects adding to an existing post-Grenfell remediation bill.
Barratt already held some provisions related to the remediation of reinforced concrete frames on developments which it said were “designed by two engineering firms whose work has previously been found to be defective”.
After the acquisition, it was discovered that the same firms had been involved in Redrow’s developments.
“Similar issues to those seen at the legacy Barratt buildings at four Redrow developments,” the firm said, resulting in an additional reinforced concrete frame provision of £105.2m.
In May 2025, the group won a landmark Supreme Court case which clarified the responsibility of companies in the supply chain for remediating defects in developments 10 they were involved in.
Looking forward, while Barratt Redrow said the “long-term fundamentals of the sector remain compelling” it nonetheless said that it “anticipate[s] limited growth in FY26”.
Chair Caroline Silver said: “Whilst the Government’s supply-side policy changes have been broadly positive, they will take time to make a practical difference.
“The overall business environment has not seen the stability or support needed to underpin investment and growth, and consumer confidence and home buying demand have remained subdued, hampering the industry’s ability to increase volumes.
“In addition, there are increasing regulatory and procedural burdens that too often cause delays and increase costs.”
It urged that the government consider demand-side support for first-time buyers in the upcoming budget.
Commenting on the full-year results, Julie Palmer, partner at Begbies Traynor, said: “Barratt Redrow has made a strong start to life as a combined business, with its first set of results since Barratt’s acquisition of Redrow proving its resilience in the face of a truly tough environment for housebuilders.
“There’s plenty to be pleased with – the integration of Redrow is running ahead of schedule, with early savings already delivered, a healthy order book providing visibility, and an increased dividend signalling management’s confidence in the group’s finances. It’s a guidebook for a merger.
However, she noted that lower-than-expected completions ”underlines just how fragile conditions remain across the housing market” and, looking to the autumn budget, warned that ”uncertainty over potential property tax changes risks dampening activity even further”.
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