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Redrow Annual Profit More Than Doubles as Its Home Prices Gain

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Sept. 19 (Bloomberg) -- Redrow Plc, the homebuilder subject to a takeover by Chairman Steve Morgan, said full-year profit more than doubled, beating analyst estimates, as it sold more expensive homes.

Net income for the year through June rose to 30.2 million pounds ($49.1 million) from 13.5 million pounds a year earlier, the Flint, Wales-based company said in a statement today. Analysts expected net income of 25.9 million pounds, according to four estimates compiled by Bloomberg.

“Despite the encouraging start to the year and the recent Government Housing and Growth announcement, the outlook for the industry remains challenging,” Morgan said in the statement. “Supply of mortgages, although slightly improved on last year, remains a significant constraint, as does public confidence due to the country’s fragile economic state.”

A group led by Morgan may offer 152 pence a share for Redrow, it said on Aug. 31. The Redrow founder left the company in 2000 and returned as chairman a decade later after disagreeing with the company’s focus on lower-income homes. Morgan, 59, declined to comment on the possible takeover in a Sept. 13 interview.

The average selling price of Redrow homes increased 15.2 percent to 189,900 pounds. Revenue rose 5.8 percent to 478.9 million pounds. Redrow completed 2,458 homes compared with 2,626 a year earlier.

To contact the reporter on this story: Chris Spillane in London at cspillane3@bloomberg.net.

To contact the editor responsible for this story: Ross Larsen at rlarsen2@bloomberg.net

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