Update on Debut and rollout programme

Wed, May 25th 2005, 11:00

On Wednesday 25 May and Thursday 26 May 2005, Redrow plc will host a site visit for sector analysts and institutions at Willans Green, Rugby to present its new Debut development.

Debut, first unveiled at Redrow’s interim results in March 2005, has received a high level of national media coverage. Debut is an exciting new addition to Redrow’s housing product portfolio, specifically targeted at delivering affordable homes for people to buy. This segment of the market is largely unaddressed by the new homes industry and forms a significant component of the Government’s current initiatives to increase housing supply.

Redrow’s first Debut development in Rugby obtained planning consent on 2 March 2005, within the statutory 13 week period and with the unanimous support of the Planning Committee. Customer interest surrounding the scheme has been intense ahead of first sales release and when the development was launched on 14 May, 87 of the 101 units released were sold within 24 hours. Construction at Rugby is now well advanced, and with the benefits of embracing modern methods of construction, all units are expected to be built within 12 months of the initial foundations being commenced.

Since the launch of the Debut scheme at Rugby, Redrow has obtained a planning consent for a second Debut development at Buckshaw Village, Chorley. This planning consent was similarly obtained within the statutory 13 week period and with the unanimous support of the Planning Committee. It is currently envisaged that planning applications for over 800 Debut homes across the UK will have been submitted by the end of December 2005.

The initial success of Debut at Rugby underpins the Group’s strong belief that the product will become an important, incremental part of Redrow’s portfolio. Redrow is targeting to build 2,000 Debut homes per annum within the next five years, with such output representing an additional growth opportunity over and above Redrow’s current product range. Gross profit margins from Debut are expected to be broadly in line with those of more traditional products whilst the fast speed of delivery provides enhancement to return on capital employed.

Paul Pedley, Chief Executive of Redrow plc said “Debut satisfies a clear demand in the market for new homes and provides Redrow with further opportunities both to extract additional benefits from its current land bank and to create more opportunities in the land market generally. The modern building methods and materials used to develop Debut enable Redrow to produce a high quality product at an affordable price which has enormous appeal to our target customers. In researching and developing Debut, we have created a product which we can build on land throughout the UK, which is incremental to our existing business and which delivers attractive overall financial returns. We are very excited about the immediate prospects for Debut.”

The presentation given during the visit will be available on the Group’s website from 11.00am on 25 May 2005. At the meetings with analysts and institutions, no new information on current trading will be released. Redrow will be publishing a trading update in respect of its financial year ended 30 June 2005 on 1 July 2005.

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