Redrow founder and chair to step down next Spring

Redrow chairman Steve Morgan (left)

Steve Morgan, chairman and founder of housebuilder Redrow, will retire from the board at the end of March 2019.

This is virtually 10 years to the day since he returned to the business on March 30, 2009.

He will be succeeded as executive chairman by John Tutte, Redrow’s current group chief executive.

Matthew Pratt, 43, will be appointed chief operating officer and will join the board at the end of March 2019.

Matthew, who has been with Redrow for 16 years, is currently the regional CEO of Redrow’s Southern businesses and is a member of the group executive board.

Redrow is based at Ewloe, near Chester.

Steve Morgan, said: “I am delighted that John has accepted the invitation to succeed me as chairman.

“I have worked closely with John over the last 10 years and believe that his appointment will ensure the stability and continuity so important to a business like Redrow.

“By the end of March 2019 it will be exactly 10 years since I returned to the group and I am proud of what has been achieved over this time.

“Since I founded Redrow in 1974 we have had many important milestones.

“Just two weeks ago we completed our 100,000th Redrow home and 2018 will see us complete 6,000 homes in a calendar year for the first time, both significant milestones for Redrow and for me on a personal level.”

He added: “We have built an exceptional team at Redrow with strong succession plans in place across all our key disciplines.

“John Tutte has been an outstanding CEO of the business over recent years and is the ideal successor to me as chairman.

“Matthew Pratt, who has progressed through the ranks over the past 16 years, is an excellent appointment in the role of chief operating officer.

“As a major shareholder, I will look forward to watching the continued progress of the business under John’s leadership.”

John Tutte, chief executive, said: “The board is very grateful to Steve for his inspired leadership of Redrow since he founded the group in 1974, a period in which the group has changed much and grown substantially.

“Steve has made a huge contribution to the industry over many years and his leadership, since he returned to Redrow in 2009, has been immense. We wish him every happiness for the future.”

Redrow is holding its Annual General Meeting today in London, where Mr Morgan will say: “For the first 18 weeks of the current financial year, Redrow has traded in line with expectations.

“We continue to see good demand in our regional businesses with most sites sold well in advance. However, the London sales market has remained subdued, affected by excessively high Stamp Duty tax and Brexit uncertainty.

“The value of net private reservations in the 18 weeks to 3 November was in line with last year at £588m (2018: £586m).

“The sales rate per outlet per week over the period was 0.64 compared with 0.67 last year, with the slight reduction, entirely due to the London market.

“The average selling price of private reservations for the first 18 weeks is up 4.6% at £388,000 (2018: £371,000). Our total order book remains very healthy at £1.2bn, an 11% increase on this time last year.

“Our operational cashflow is strong with net cash currently standing at £132m (2017: Net Debt £25m).

“We broadly welcome the extension, announced in the Budget, of the highly successful Help to Buy scheme which has enabled to date the purchase of almost 170,000 properties, over 80% of which were first-time buyers.

“We would, however, urge the Government to review the regional price caps that markedly disadvantage the North and Midlands in favour of the South of England.

“Redrow has an industry-leading, highly desirable product, an excellent forward sales position and a very healthy balance sheet. We are in great shape to deliver another year of progress for the business.”

Russ Mould, investment director at Manchester-based investment platform AJ Bell, said today: “Amid some complaints about stamp duty and minor issues with Help to Buy, despite the extension of the scheme by two years in the recent Budget, the key news ahead of housebuilder Redrow’s AGM is the departure of founder and executive chairman Steve Morgan.

“Morgan started the business back in the 1970s but left in 2000 to pursue other ventures. He returned nine years ago to help drag the company out of a downward spiral in the wake of the financial crisis.

“He did so successfully, helped by a supportive environment created by low interest rates and the Help to Buy scheme.

“The total return achieved for shareholders by Redrow since Morgan came back in March 2009 is 482% and he will retire almost exactly a decade after he rejoined the business in March 2019.

“This time Morgan is highly unlikely to return again, even if Redrow were to hit rocky ground. The company appears to have played it safe with his replacement as current chief executive John Tutte steps up to chair the group.”

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