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Redrow Warns On Sales Rate, To Cancel Interim Dividend Due To COVID-19

British housebuilder Redrow plc (RDW.L) Tuesday said it decided to cancel its 10.5 pence interim dividend, due to the ongoing uncertainty related to the coronavirus or COVID-19 pandemic.

In its update on the impact of Covid-19 on its business, the company noted that due to the Government's escalating measures to contain the spread of the virus, the company projects its sales rate will be seriously impaired over the coming weeks and build output will be significantly affected by labour and material shortages.

The company also expects outlet openings to slip as local authorities delay planning committee meetings.

Last week net private reservations were in line with the previous year at 95 plots, but visitors to site were substantially down and the cancellation rate increased.

In the first 12 weeks of the second half to March 20, the company said its trading has remained resilient. Value of net reservations went up 121 million pounds at 525 million pounds compared to last year. The weekly reservation rate per outlet has averaged 0.86 against 0.72 last year over the same 12 week period.

The company said its order book is very strong, currently standing at over 1.4 billion pounds.

Redrow will cancel its interim dividend amounting to 37 million pounds, which was due to be paid on April 9 to holders of ordinary shares on the register at the close of business on March 6.

The company further said it has a strong balance sheet together with 250 million pounds of committed facilities.

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