Redrow sees yearly profits slump

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UK housebuilder Redrow saw its annual profits almost halve as it battled "unprecedented market conditions".

The Flintshire-based firm reported pre-tax profits of Â£65.5m in the year to 30 June, while revenue dropped 22% to Â£650m during the period.

Redrow cut the value of its land bank by Â£260m and warned that the squeeze on mortgages could continue until 2010.

But it said it had secured access to an extra Â£450m of debt as it tried to cope with the gloomy conditions.

Downturn

The access to the new debt would help it manage the business "through these exceptional markets", it said.

"The severity and speed of the deterioration of the housing market in 2008 will impact on short term profitability," Redrow said.

The firm's chairman, Alan Bowker, called on the government to act to boost the availability of mortgages to try to stimulate the housing market.

"It is our view that there may be no meaningful increase in the availability of finance in the wider mortgage market before 2010," he said.

The slowing demand for new homes has dented the value of land.

The firm said that that when this write-down was taken into account, it had seen an annual loss of Â£193.9m.

As part of the downturn in the sector, thousands of UK construction jobs have been lost in recent months.