Good morning, everyone, and thanks for coming along to see us this morning, and welcome to Barratt Redrow's interim results presentation for FY26. This morning, I'm joined by Mike Roberts, our Chief Operating Officer, who will provide an update on our operational performance; John Messenger, our Investor Relations Director, who will update on our financial performance; and after John, I will then update on the market, current trading, synergies, and also set out how well positioned we are for the future.

I would like to take you through some of our key messages. Barratt Redrow's performance over the half was resilient, both operationally and financially, and that is despite what has been a generally subdued market.

While the consumer did benefit from two interest rate cuts and mortgage availability improved, consumer confidence clearly remained low. Speculation ahead of the November budget caused many to postpone decision-making.

We have maintained our financially robust position and solid balance sheet. Importantly, the successful integration of Redrow is near completion, and our synergy target remains unchanged.

We are now operating from three distinct, high-quality brands. Building on all of this, our focus centers on business as usual for Barratt Redrow around both optimizing our capital employed and fine-tuning our costs to ensure that we drive operational excellence and efficiencies across the enlarged group so that we feel well placed for the full year and well positioned for future growth.

If we look in more detail at the operational highlights from the half year, clearly embedding Redrow into the business was, of course, a highlight. We have started to see the benefits of this reflected in our performance, with good progress on synergies that I'll cover in more detail later.

Our land position is strong at 5.6 years, allowing us to be even more selective around land intake. We delivered 7,444 homes in line with our plans for the year, which was a good achievement given the market environment.

I would also like to highlight some of our externally accredited credentials in the period. Our repeated success in the HBF ratings and in the NHBC Pride in the Job Awards are testament to the dedication of our teams across the business, as well as to the quality of training that we provide and the customer-first culture we maintain across the group.

This quality is also reflected in our Trustpilot scores given by our customers, which award all three of our brands with the highest rating of excellent. John will cover our financials in more detail, but just to pull out a few highlights.

Adjusted PBT before purchase price allocation impacts was lower than last year at £200 million due to higher net interest costs and lower joint venture profits. Return on capital employed, again pre-PPA adjustments, was in line with last year at 9.1%.

We were particularly pleased that nearly all of our £100 million target synergies were confirmed at the end of December. Finally, we finished the year with a solid net cash position after organic investment, which supports our growth plans, also our dividend payments of £172 million, and the share buyback of £50 million in the half.

With that, I will hand over to Mike, who will now go through our operational performance in more detail.

Thank you, David, and good morning, everyone. I'd like to take a moment just to introduce myself.

I've been in the housebuilding industry for 32 years, and I joined Barratt back in 2004. I've worked closely with Steven Boyes as Managing Director of our North East division, and in 2017, I was appointed Regional Managing Director for the Northern region.

In July last year, I was appointed Chief Operating Officer on Steven's retirement. Today, I'll be taking you through our operational performance for the first half.

Starting with the private reservation mix on slide 7, there are a couple of points to highlight. Firstly, PRS.

Given the budget uncertainty, the market became harder in the period, and potential discounts increased. We maintained our discipline and were less active.

As a result, PRS reservations were a lower proportion of overall reservation volumes at 4% down from 9% in the equivalent period last year. Secondly, for existing homeowners, we saw a significant increase in the use of part-exchange at 23% of our private reservations, up from 14% last year.

We've introduced our industry-leading part-exchange skills into the Redrow brand. It offers a stress-free moving option for our customers, and at a time when conveyancing chains were a concern for many potential homebuyers, it has proved a popular incentive.

To be clear, it's offered as an alternative and not additional incentive, and it's worth noting that the combination of part-exchange and second home movers remained fairly consistent year-on-year. Part-exchange has been an integral part of our business for many years, and stock levels are carefully managed.

At the end of the half, we had just 180 units unsold. Turning to completions on slide 8, we delivered 7,444 homes, an increase of 4.7% on the aggregated performance last year.

Both private and affordable completions were ahead, although this is more about timing, our guidance for FY26 is unchanged. Underlying private completions were 1.8% ahead, and PRS completions were up over 50% to 423 homes.

This increase was largely a function of our order book coming into the year, and as I said earlier, the market has subsequently hardened. Affordable home completions were up 26%, helped by the rebuilding of our order book in the prior year, and are now 19.5% of wholly owned completions, which is in line with our expected affordable mix.

Joint venture completions were lower than the prior year due to timing, but we are on track to deliver approximately 600 units in the full year. In terms of pricing, the wholly owned average selling price was up 4.9%.

More detail is provided in the appendix, but this trip was driven by a combination of mix, producing a slightly larger average unit size, and geographical volume variances given the spread of average selling prices between the regions. There were some notable variations by region, with our Central and East regions seeing the strongest average selling price growth.

Now turning to sales performance here on slide 9, the underlying private rate remained solid at 0.55 reservations per week ahead of last year, with customers benefiting from an improvement in mortgage availability and affordability. This good performance came despite the uncertainties which overshadowed much of the period.

PRS and other multi-unit sales effectively paused in the run-up to the budget, and although we saw a pickup afterwards, this added just 0.02 reservations per week over the period, down on last year. We operated from an average of 405 sales outlets, below last year, but very much in line with our plans.

David will cover our view on sales outlet evolution later in the presentation. Turning to the private forward order book, this was 10% lower at the half-year stage.

This partly reflected a high starting point coming into the year, but also the reduced reservation rate, lower numbers of sales outlets, and increased completions in the first half, all of which contributed to the overall lower number. Given the solid start to the calendar year, we are confident that we can deliver full-year completions in line with the guidance.

I'd like to wrap up with our industry-leading credentials around design, build quality, and customer service. It's what underpins our brands and is key to our sales success.

We achieved a five-star rating for customer service in the HBF survey for the 16th consecutive year, and our site managers have secured an industry-leading total of 115 Pride in the Job Awards and 45 Seals of Excellence. Reportable items per NHBC inspection have increased slightly following the Redrow acquisition, but with opportunities to share best practice across the divisions, we expect to see this improve.

Finally, I'd like to take this opportunity to congratulate Dayne Mumford from our East Midlands division, who was runner-up in the large builder category at last month's Pride in the Job Supreme Awards, an excellent achievement. On that note, I'll hand over to John for an update on our financial performance.

Thanks, Mike, and good morning, everyone. Today, I'll take you through our half-year '26 performance, an update on our landbank, and also on building safety.

Here is an overview of the half-year numbers. To be as clear as possible, we have set out here the adjusted pre-tax profits before PPA adjustments, then the adjusted profit before tax after PPA, and finally, the statutory pre-tax after adjusted items.

The first point to note is that both adjusted measures are now stated prior to the impact of imputed interest charges on legacy property provisions. We believe this measure provides you with the best view of the underlying performance of the business, moves us in line with peer reporting, and includes the reclassification of £19.6 million of non-cash imputed interest in half-year '26 and £18.4 million in half-year '25, which has been added back in arriving at the reclassified results you see here.

We also show the comparables, and just to flag, the aggregated and reported periods have seen minor restatements for the finalization of the purchase price allocation process, which was completed at the end of last year. I will focus on our performance relative to Barratt and Redrow aggregated for the whole of half-year '25.

You will remember, we consolidated Redrow actually from the 22nd of August. Adjusted profit before tax before PPA impacts was down 13.6% in the half-year to £200 million.

I'll take you through the key drivers of that in a moment. The good news is that the purchase price allocation impacts largely fall away from next year, which will make all of our lives a lot easier.

Slide 13, this slide looks at the margin performance in more detail, and there are several points to highlight. The increase in home completions coupled with an increase in ASP generated revenue growth of 10.5% to £2.6 billion.

However, the adjusted gross margin was 200 basis points lower at 15%, giving an adjusted profit of £394.8 million. There were three drivers behind the margin movement.

Firstly, while we benefited from growth in completion volumes, underlying pricing was flat. We then saw two headwinds on two fronts: our targeted but increased use of non-cash sales incentives, particularly extras and upgrades to convert reservations against the challenging backdrop through 2025, was a negative to gross margin.

These incentives added directly to cost of goods sold and had a direct impact on the gross margin. We also experienced underlying build cost inflation of approximately 1%, including procurement cost synergies.

At operating profit, through both cost discipline and the benefit of cost synergies, adjusted operating profit before the impact of PPA adjustments was flat at £210.2 million, with the margin down 90 basis points to 8%. I'll cover margin movements in a moment, but just the final parts in the mix here: adjusted finance charges at £12.4 million compared to finance income last half at £12.2 million.

This reflected reduced average cash balances, utilization of our RCF in the period, and the imputed interest rate on new land creditors relative to those being settled. JV income with lower completions in the period has reduced to £2.1 million.

As a result, adjusted PBT before PPA impacts was £200 million, giving an adjusted earnings per share of 10 pence. We have proposed an interim dividend of 5 pence per share, with our two times dividend cover ratio in place for the full year.

In summary, we saw good momentum on home completions and are pleased to see the benefits of Redrow integration coming through. Looking forward, there are clear opportunities to improve our gross margin, which David will cover.

Turning now to our landbank on slide 14, a steadier pace of land acquisition, growth in completions, and a reclassification of some Redrow plots into our strategic landbank has seen the duration of our owned and controlled landbank move to 5.6 years in December. Our landbank is in a strong position and very consistent with our plans to optimize our capital employed, as David will set out.

A key metric here on the slide, which we're increasingly focused on, is the average number of detailed consented plots on each of our sales outlets. This is clearly a function of the size of the outlet and the timeframe over which it has been actively selling, but we are looking to ensure our landbank is efficient, with sales outlets sized to typically deliver sales over a three to four-year period.

With more than 27,500 strategic landbank plots submitted to local planning authorities across 103 applications, we expect to make further progress on strategic land conversions over the coming years, too. Now looking at our embedded margin in the landbank, here you'll see the updated plot distribution of embedded gross margins across our owned landbank plots.

There are three moving parts to highlight: first, a positive 40 basis point impact reflecting the plot mix traded out through completions this half at a margin of 14.5% after including the PPA impact; second, a negative 90 basis point impact from the flow-through of flat pricing, build cost inflation, and incremental sales incentives; and thirdly, a 20 basis point improvement from land acquired in the period at a 23% gross margin. As a result, the embedded gross margin ended the half 30 basis points lower at 18.9%.

Improving the embedded gross margin is a clear priority. With little movement on pricing, we will do this best by managing cost base inflation, driving development pace, and buying land appropriately.

To slide 16, here we look at our adjusted operating margin and the bridge. On a pre-PPA basis, including Redrow for the full 26 weeks, this was 8.9% for the combined operations in half-year '25, first column shaded here on the left.

We saw a benefit of 40 basis points due to the gearing effect of higher volumes. The combination of flat pricing, but underlying build cost inflation at 1%, and the targeted use of non-cash incentives created a negative inflation impact of 90 basis points.

Completed development provisions, reflecting local authority delays in adoption of roads and public spaces, accounted for a negative 40 basis points. The impact of cost synergies, which I will set out in a moment, added 90 basis points, and these savings covered off both the underlying inflation in our admin expenses as well as mix and other items.

This has resulted in the operating margin before PPA impacts of 8% for the half. Finally, you can see the PPA dropping off to deliver the 7.5% margin on an adjusted basis.

Turning to administrative expenses and adjusted items, we reduced our adjusted admin expenses by 5.4% in the half-year to £184.8 million when compared to the aggregated business last year at £195.4 million. We also then show the adjusted items here in arriving at our reported admin expenses at £208.7 million.

This included adjusted items charges of £23.9 million, with £18 million charged on further restructuring and integration and legal costs on legacy property recoveries at £5.8 million. Whilst not shown here, the net impact of adjusted items in the period was £10.5 million, with significant legacy property-related recoveries from third parties of £13.4 million recognized in gross profit.

It's positive to see both cash-based adjusted items falling away, as well as receipts coming in with respect to building remediation. Here is just a quick bridge in terms of the admin expenses.

The movement in admin expenses from the aggregated base of £195.4 million to the £184.8 million is set out on this slide and shaded in light green. We saw an increase of £4.3 million related to changes in national insurance contributions and a further £8.1 million from total cost base inflation.

Cost synergies then delivered a £23.2 million positive impact, which were then coupled with a reduction of £0.2 million in sundry income, which covers JV management fees and ground rents, delivered the outturn at £184.8 million. It is positive to see the synergies we identified at acquisition having a meaningful impact on our profit and loss account.

Turning to building safety, where I'm pleased to report that there is very little to cover. There were no changes required to our provision position.

Having spent £77.8 million on works across our building safety and reinforced concrete frame portfolios in the half, and seeing the unwinding of imputed interest of £19.6 million, our total legacy property provisions sat at just over £1 billion. To cash flow, slide 20 sets out the cash flow bridge for Barratt Redrow from reported operating profit on the left to the net cash outflow on the right.

Really just a couple of cash flow numbers to point out. The biggest driver of cash outflow in the period was the seasonal increase in construction work in progress alongside part-exchange investment, together equating to just over £313 million.

Three quarters of this is construction work in progress, very much following our sales cycle and construction seasonality. Our net investment in land was relatively modest at £68.7 million.

Adjusting for the dividend payments of £172 million and £50 million in share buybacks, the net cash outflow was just under £600 million. We would expect an inflow of circa £300 million in the second half, and for the year-end cash position to be in line with guidance of between £400 million and £500 million.

For ease, we have included on the slide here a reminder of some of the other relevant guidance points around cash flow. Turn to slide 21, here is our usual balance sheet breakout.

Limited points really to highlight, but over the 26 weeks, we saw a £21 million net investment in our gross landbank, and land creditors reduced by just over £42 million, giving a net land position of £4,358 million, with land creditors funding 15% of our land investment. Land creditors clearly remain below our target range of 20% to 25%, but we are looking to add a larger proportion of land purchases on deferred terms to take us towards our target range, and also to manage our landbank more efficiently, as I alluded to earlier.

The other balance sheet item to mention here, as already discussed by Mike, is our part-exchange investment, which you can see closed out at £219 million, with £74.7 million added in the half-year period. Before I wrap up, I thought it would be helpful to remind you of our capital allocation priorities set out here.

Our enhanced scale and balance sheet strength clearly put us in a strong financial position. We are very mindful of the obligations we have, particularly with respect to building safety, and we are managing this appropriately.

The Redrow acquisition has multiplied the opportunities we have to drive growth and value from the business, we will invest in these, but at the same time, we will look to drive efficiencies in the way we manage both our capital employed and our cost base. Finally, we recognize the importance our shareholders place on capital returns.

We have a clear dividend policy, and this is alongside an active £100 million buyback program, with £50 million completed in the first half and a further £50 million underway and set to complete in the second half of the year. To summarize, our operational performance in the half-year has been resilient, and that's despite the macro uncertainties faced.

Our balance sheet remains solid, and we are capturing the cost synergies from the Redrow integration, with our cost synergies confirmed. Turning to guidance, you will find a detailed slide in the appendices, but I thought it helpful to cover the main points here.

As previously set out, we expect full-year '26 total completions to be within the range of 17,200 to 17,800 homes. Underlying pricing is expected to be broadly flat, and we expect build cost inflation to be around 2%, including the benefit of procurement synergies.

Reflecting the reclassification of imputed interest on the legacy property provisions, we anticipate an adjusted finance charge of approximately £30 million, with provision-related adjusted item imputed finance at £32 million for FY26. Our building safety program remains in line with guidance at approximately £250 million of spend in the year.

We expect to finish the year with between £400 million and £500 million of net cash. Happy to take questions later, but I will now hand back to David.

Thank you.

Thanks very much, John. I'd like to start this section with an overview of the housing market.

We've talked before about the fundamentals of the market which underpin our sector, and these continue to be strong. There is a longstanding imbalance between demand and supply.

The challenges for our industry are affordability constraints on the demand side and planning constraints on the supply side. Housing and planning reforms are clear priorities for the government, and we welcome the steps that they are taking to improve the planning environment.

However, it will take some time for these reforms to feed through at a local level. With many local authorities having elections in May, the planning backdrop in those areas could remain challenging until the second half of the year.

Meanwhile, some of the near-term indicators on the demand side are more encouraging. Uncertainty has definitely moderated post-budget.

Markets are pricing in further interest rate cuts, and mortgage availability continues to improve. Consumer confidence remains weak.

Despite some slight improvements, affordability remains challenging, particularly for first-time buyers needing to bridge the deposit gap. In this environment, we recognize that self-help measures are very important.

As Mike outlined, we continue to develop our part-exchange offer, particularly for Redrow, and in the half, we also launched our own shared equity offer alongside our popular first-time buyer and key worker schemes. We continue to believe that the key to a sustained recovery in the housing market and volume increases across the sector is government support for prospective homebuyers of the type which has been in place for many decades until two years ago.

Overall, given the market context, recent trading has been resilient. We have seen encouraging consumer activity since the budget, but consumers are still taking their time.

Our net private reservation rate over the five-week period was down slightly on last year. The FY26 opening order book and slightly improved affordable housing sector backdrop means that year-to-date completions and forward sales are both ahead of the position last year.

There continues to be a lot of political and economic volatility at the macro level, which is clearly unhelpful for consumer confidence. Given the broader market context, for us to maintain a sharp focus on efficiency and leveraging the benefits of the integration is going to be key for Barratt Redrow.

I'd like to give you an update on our synergy program. If we start with cost synergies, we have confirmed our target of £100 million of annual cost synergies.

In FY25, we delivered £20 million of cost synergies through the P&L, as you can see on the chart. We expect to deliver a further £50 million through the P&L in the current financial year, having already delivered over £30 million in the half year.

We are very definitely on track for that cost synergy delivery. Looking at revenue synergies, our target is to open 45 incremental sales outlets.

To date, we have submitted 31 planning applications, of which 16 have already received approval. We are on track to submit the remaining applications in the second half of the financial year, and we expect the first sites to be ready for sales opening at the start of FY27.

Moving on to outlets, as we've said, the planning reform is positive, but we do have to experience that improvement on the ground. As we've previously guided, we expect average outlets to be flat in the current year, but we would expect to see a good uptick in FY27, both through organic growth and with around 15 synergy outlets coming on stream.

This should bring average outlets for FY27 to between 425 and 435. Importantly, given the strength of our landbank, we do not have to make significant future land purchases to drive our outlet opening plan.

It is primarily about using the land that we already have. As you can see, our integration activity is largely complete.

Looking forward, our focus is on two key areas: optimizing our capital employed and fine-tuning our cost structure. This half, given the strength of our landbank following the combination and our land approvals in FY24 and FY25, we have substantially reduced approvals.

Alongside some land swaps and land sales, we will continue to make targeted acquisitions, and we anticipate approval of between 10,000 and 12,000 plots in FY26. Dual and triple branding our sites means we can reach more customers, which should improve our sales volumes and help our asset turn.

Turning to costs, given our scale and reach, we see opportunities to drive efficiencies across our supply chains and to make marginal reductions in our overheads. This discipline is business as usual for us.

Pulling this together, we remain very confident that Barratt Redrow is best placed to navigate the market for all points of the cycle. Fundamental to this are our three high-quality and differentiated brands, and we have the skills and experience to deploy them effectively.

These brands allow us to operate in a variety of locations and local markets, with the optimal divisional infrastructure to match. Our customer focus has been established by our numerous third-party credentials over the long term.

We are the reliable partner of choice across the private and public sector, allowing us to be flexible and innovative. Our reorganized divisional structure and brand portfolio positions us well for growth over the medium term.

Finally, we remain financially strong, with a robust balance sheet and a solid net cash position. To wrap up, we do have three high-quality, differentiated brands.

We have a strong landbank. We have clear visibility over our outlet opening program.

We are a leading platform for growth. Virtually all of the £100 million of synergies are confirmed, and we expect the integration to complete by April this year.

Looking forward, our focus will be on continuing to drive our operational efficiency and using the opportunities we have identified to drive growth and value for all of our stakeholders. Thank you.

Thank you very much for that, and we're now going to open up for Q&A. John is going to facilitate the Q&A, and he is looking forward to the large number of questions I know you're going to put his way.

will start the front row, Chris, and I think you need to pull and press basically. Great.

Chris Millington.

Morning, everyone. Thanks for taking the question.

I just want to ask about the pricing experience so far in calendar year '26 and whether or not you're seeing any sort of improvement there, obviously with incentives, and perhaps you can just put a regional overlay on that. Second one's just around the outlet opening profile.

It's a big ramp-up you've got there. Now, if I understand what you said correctly, is you're going to be flattish in the second half, but then potentially up at 430 next year, roughly about 8% growth.

Now, if that's linear, it means the opening close is going to have to be 16-ish percent higher. It feels a big number with some of the uncertainties out there, but perhaps you can give me some confidence there.

The final one's just really about the gross margin in the landbank. It looks like you're taking the lower-margin plots at the front end, that makes a little bit of sense because of the new land coming in at higher margins, but how long do you think you get to the average landbank margin?

Because you kind of under-indexing what, 400, 500 bps at the moment versus average. Thank you.

Hi,

Chris. Thanks very much.

Maybe if I take in terms of pricing and incentives to start with, and then I'll sort of say a few words about outlet opening, and then John will follow up in terms of outlet opening, and then John will pick up in terms of gross margin. I think in terms of pricing and incentives, the first thing that I would just put in context is that if you went back to August '25, we started to see a lot of news flow about what may or may not be in the budget.

At the beginning of October, we made a very conscious decision that we needed to push harder in terms of incentives, not in terms of gross price, generally keeping gross price as is, but pushing more in terms of incentives. I think that's seen a step-up in relation to part-exchange, a step-up in relation to related incentives.

Coming into the new calendar year, post the budget, I just think we've seen a higher level of customer interest, and we probably have a bit more confidence in terms of our ability to maybe gear back a little bit on incentives, not in that we're going to move it 1% or something in a short period of time, but there is just more interest out there, and I think all of our divisions feel that that is a slightly better backdrop, with the possible caveat around London, which I would say is pretty much unchanged. Then, just before I pass on to John, in terms of the outlet opening program, I think the really key point is that we have the land under control.

In terms of our FY27 position, we're in the high 90s in terms of having a planning position in relation to that. We would see some uptick in outlets late in this year, which will not impact reservations, and we overall will see quite a substantial uplift in FY27.

I think the key point is we don't need lots of planning to deliver that, and bear in mind a big chunk of it is coming from synergy outlets, which are already under our control. John, do you want to?

Absolutely.

David's stolen some of my thunder with the synergy points, but there you go. If you look at where we are broadly at the end of this year to where we'll be at the end of next, a big part of that is effectively 30 synergy outlets in there, which will leave you with a balance of 20 to 25 that need to come through the organic route, Chris.

I guess we are certainly comfortable in terms of that profile coming through. When we look at the timing of it, there is quite a significant, yeah, outlet opening program clearly across '27, but there'll be certainly a decent boost in the second quarter, which will obviously lead us into the spring selling season for Q3.

Part of it is very much kind of profiled across the year, but we actually have a pretty useful program planned for that second quarter, which will obviously give us a January start into that new calendar year. The other one was around gross margin.

Just to be clear, the embedded gross margin at 18.9% is post-PPA, it's all in, the Redrow plots are in there, including their PPA component. We expensed at 14.5%, as you saw in the slides; the embedded is 18.9%, you've got a kind of 440 basis point differential there.

I think when you look at the length of the landbank at 5.6 years, clearly the average, to get there, we're probably talking about 2.5 to 3 years realistically before you're going to hit that point, because obviously it's partly about the timing of when we purchased and when those new sites that are coming in at the higher gross margin start to really feed through in terms of volumes, not just in reservations, but in the completion mix. Hope that helps.

Will Jones at Rothschild Redburn.

Thanks, yeah. Will Jones at Rothschild & Co Redburn.

Maybe just three, please. Perhaps just touching base on build costs.

I think your guidance for the second half implies about 3%, perhaps including some synergy benefit as well, just the moving parts within the latest on build costs. Secondly, perhaps just more of an overview and reflection six months plus on from the formal integration, just your view of how the Redrow brand and business is performing post-acquisition.

Then lastly, if we just cover off on building safety, obviously good to see no movement in the provision, but just your level of confidence as you assess the portfolio and what you may still not know about potentially. We look forward.

Thanks.

Will. Thank you.

Mike will pick up in terms of build costs, and I'll pick up in terms of Redrow and building safety. I think in terms of Redrow, we said at the time, we are admirers of the Redrow brand.

We think it's an absolutely fantastic brand, and getting Redrow really focused on the heritage brand, because inevitably to grow the business, Redrow were doing more than just heritage, and we think Redrow really focused on the heritage brand is where they want to be, and it's where we want them to be, and it is the premium brand in our portfolio. In combining with the business, they have a fantastic landbank.

I think the opportunity for us to be able to take Barratt to the Redrow sites, to work together, and maybe Barratt deliver more of the affordable housing, for example, alongside the Barratt housing is a really big opportunity. Then where we have sites where perhaps we were already Barratt and David Wilson, and we might have sold land to a third party, we can bring Redrow onto those sites, and we clearly have a number of those sites.

The synergy sites are just the start of the story. I think all of our land acquisition going forward, where all three brands operate in that geography, then we're looking for opportunities for those brands to operate well.

I really feel that in terms of the brand, the consumer proposition, and in terms of the build, sales teams, it's really done well and really integrated well. That's all positive.

I know we've touched on the synergies, but I think it's just pleasing to be in a situation that we've effectively banked the £100 million of cost synergies. We're obviously looking for more, but the reality is that our main focus now is on the delivery of those cost synergies and then ensuring that we get the revenue synergies executed, which I think we're well on with.

In terms of building safety, yeah, look, John said that we're pleased to really be saying nothing. I think that's a nice position for us to be in.

I think it's too bold for anyone to say we're absolutely comfortable with all our provisions and so on. I think everyone has seen that the evolution of this has been challenging.

We feel that we really have our arms around both building safety in terms of remediation of buildings and also concrete frame. Both parts of it, I think, are moving well, and we'll just continue to update on a six-monthly basis.

Mike, do you want to pick up on build costs? Yeah.

We've guided inflation at around 2% for the full year. We estimate that that will be split between labor and materials, 1.5% labor, 0.5% materials.

Labor, generally, we're seeing 2% to 3% price pressures really around national insurance and salary reviews, as per would be the norm. What we're not seeing is any inflationary pressure around scarcity of labor or labor availability, there is no excessive pressure on the inflation for the labor content.

Materials, pretty variable, actually. Obviously bringing the Redrow business into the Barratt David Wilson team, we've improved our procurement capabilities.

We're seeing bricks and blocks around 3%, unengineered timber up at maybe 10%, but lots of materials at flatlining or very very low digits, really. Overall, we're pretty confident that we will be able to land that at around 2% for the full year.

Okay. Let's go to Emily, and then we'll come across.

Emily at Barclays.

Morning, Emily Biddle from Barclays. I've got two, please.

The first one just on how we should think about the margin bridge, I suppose, for the second half of the year. Conscious you've guided build cost inflation higher, but presumably the way that you account for that, you've sort of already reflected that in the first half margin.

Then the sort of positive things around the potential for incentives to be a touch lower, is that sort of the way we should think about it? Then on top of that, can you just remind us the sort of the extent to which you benefit from sort of fixed cost of goods and some leverage over that in the second half of the year, and potentially that sort of little bit of landbank evolution, can you give us a sense of sort of what the magnitude of that might be?

Then secondly, I think David mentioned the sort of evolution of the part-ex offering in Redrow. When we look at that on the balance sheet, is there a number that you're comfortable with it sort of ticking up to be, or is that what you're sort of trying to tell us, that it might actually be a little bit more on the balance sheet towards the end of the year, or how should we think about it?

Emily, thank you very much. I think that first question, you sort of asked and answered it at the same time.

You've given John too much of a clue.

John will cover the margin bridge. In terms of part-exchange, I think most of the housebuilders have a part-exchange offer.

It is a fantastic way for us to compete in the marketplace. Bear in mind that the vast majority of customers sell a second-hand home and buy a second-hand home.

Where we are able to break into that, we are best to break into it with a part-exchange offer. I think you'll see that part-exchange is two things for us.

One is we have something that we would call Movemaker, where we would effectively give a commitment to buy the property, but we would primarily focus on the property being sold before we get to the point of completion on the new build house. Then we would then have a part-exchange offer where either that Movemaker doesn't work or we agree to take the property from the beginning.

The number of properties and the value of properties is not a huge concern to us. The operational and the financial risks are similar.

Mike touched on that we have about 180 properties that are not reserved, which I think when you look at the size of the group across 30 divisions or 32 divisions, is a small number of properties. The more part-exchange we can do in the current market, the better.

In terms of Redrow, I think Redrow did have a Movemaker equivalent, and they did have a part-exchange offer, but I would say that they were reluctant to use it, and we just see in the market that we need to do more of it. The Redrow position in the underlying numbers has grown from what in the FY25 was round about 2% of their business was using the PX offer to it now being kind of above 10% of their business is using the PX offer.

We're very, very positive about that offer in the market.

Then, just to pick up on the margin bridge, Emily. I think there are probably four aspects to this to keep in mind in terms of the bridge from last year to this year.

First, plot mix-wise, which was mentioned there, if we look at the delta, I guess that implies with 440 basis points from where we reported in the first half to the average in the landbank, that broadly equates to 80 or 90 bps per annum, thinking of that movement. That's probably quite 50 bps in a half-year period if I was looking to try and work a number through there, Emily.

Second one is then on build cost inflation, and you're correct in terms of given the accounting approach and margins on site-based approach, a lot of that cost inflation is already built into the margin that we're recognizing. Clearly, we've got to work hard in the second half to control and limit that impact from build cost inflation.

The positive on the other side of that is clearly from an incentive level, where we added circa 1% to our incentives in the first half, that was very much driven by the budget and the need to convert people and to give people a call to action effectively to reserve and move through to completion. Obviously, as we work through the spring, and given we've had a pretty encouraging start, certainly in the four weeks of January, post the first week we had, then we'll be working side-by-side literally trying to move and make sure that we're optimizing both the balance of volume and value and that around the incentives that's applied.

There will clearly be a push to try and work as where we can to get that incentive lower. Then finally, on the volume gearing aspect, when you look at our volumes, we're broadly 40% more volume in the second half than the first, that mathematically obviously will come through in terms of a bit of operational gearing, and that should again help on the second-half margin.

Those are the four ingredients in terms of that movement there. Thanks.

Over to the other side. Aynsley, and then Clyde.

Thanks. Morning, Aynsley Lammin from Investec.

Just two, please. Just picking up on your comment actually around the sales rates, John, just I think you said the last four weeks particularly have been good.

Just wondered if you had any more color, has it been progressively improving? When you've maintained your full-year kind of completion guidance, but I think you mentioned that obviously it's dependent on sales activity, how much risk is there, what do you need to see in the spring selling season to kind of meet that full-year completion guidance, I guess?

Then second question, on the provision, as you say, good to see it kind of stay around the billion level, but could you just remind us how long you expect to work through that and what the kind of annual cash outflow profile looks like during that period?

Okay. Aynsley, hi, good morning.

I'll just make sort of comment on the sales rate and the sales risk and pick up on the provisions. I'm just going to answer them both.

That's it. Look, in terms of sales rate, I think that we had quite a bit of debate about this.

The reality is we've always said we're not going to split current trading, whether that's positive or negative, because it's such a short period, and then we get into saying, "Well, the first week was this, and the third week was that," and so on. We're not going to kind of break with that.

I think what we would say is that our business is positive about what we've seen during the month of January. December is always a tricky month, but when we come into January, we've just seen good consumer interest, good level of appointments, and reasonable levels of reservation.

Now bear in mind that we're not comparing really to last year. We're presenting the numbers compared to last year because that's the convention, but we're really talking about what was it like in October compared to what is it like in January, and it is substantially better in January than it was in October.

That's the reality, that October-November period. In terms of looking at the risk, we're sort of really working on the basis that we need to sell at about 0.6, and we feel comfortable in terms of that sale.

We give ranges. It's a problem if you do and it's a problem if you don't.

I would say that we've got a high level of confidence of hitting the midpoint of the range, and we don't see lots of downside to that, and potentially there's a little bit of upside, but I think we've got to focus on that midpoint of the range. Then, sorry, provisions.

The cash run rate on provisions. My sense is that there's another four years at least in terms of the run-off of the provisions.

We would expect expenditure will start to accelerate in '27. There's a huge amount of setup to be done to get the developments through the Building Safety Regulator, because all of these developments have to go through the Building Safety Regulator.

We see that backdrop with the Building Safety Regulator has improved from where it was 12 months ago. There's much more transparency about what is happening, but they have a huge amount to address in terms of the backlog.

Getting stuff through the Building Safety Regulator and therefore substantial expenditure in '27 and '28. Realistically, on a £250 million run-rate cash spend this year, I think we're very unlikely to be above that cash spend, and we'll just run it off over the next three or four years.

Clyde?

Thanks. Clyde Lewis at Peel Hunt.

Three if I may as well. Probably following up on Aynsley's question there about sort of recent activity.

I'm still a little confused as to where we are, because normally spring is the best selling season for all housebuilders, and obviously we've had the pretty shocking October, November, December period, there's a catch-up. I'm just again really trying to get a feel for whether it really does feel better than last spring or spring in '24 or spring in '23 compared to where you would have been in Q4.

I understand clearly it's better than Q4, which it traditionally is. Just pushing a little bit more on that.

On land creditors, I suppose, be interested to hear how quickly you think you can get into that range of 20% to 25% that you're talking about, and inevitably there's a trade-off with chasing a higher gross margin on new land sales, just interested in I suppose probing that a little bit more. The last one was obviously can't not ask it, was really the government support.

David, you've mentioned it; others are increasingly mentioning it in their updates. Do you think the government is starting to move to think about this a little bit more?

From what I understand, Treasury is the bigger blocker rather than maybe the political side, but be interested on your views there.

Okay. I feel I've sort of had a go at the sales rates and stuff, I think I'm going to ask maybe Mike to comment on it looking particularly at where we were October-November compared to where we are now.

I think that's really the key thing. I would say on the sales rates, our forward forecasts are very much thinking, okay, we need to be at this level of 0.6, which we're not far away from.

In terms of land creditors, look, I think probably just two comments. One, us increasing the land creditor position is obviously dependent on land intake, and our land approvals is obviously very low, first point.

Second point, I think when you look at the next couple of years, it would seem that there is going to be a huge amount of land coming through planning. John referenced in his presentation that we have more than 100 strategic sites in for planning.

What I would say is that the ability to defer land payments will be greater if there is much more land coming into the marketplace, and we're already focused on the deferral of payments. I think it's very achievable to get into that higher banding of kind of 20% to 25% in terms of land creditors, but it will depend on land intake.

In terms of government support, well, I think really two things. I believe that everyone would agree, that you have to address the supply side.

If you don't address the supply side, then you are just going to create issues by putting in demand-side support. I think that's kind of been well-documented.

The government have really got after the supply side. Now, I understand it hasn't changed yet, but from what we can see, the supply-side changes are far more powerful than the original Conservative government National Planning Policy Framework, etc.

Therefore, numbers can go much higher. We're back to top-down, and there's an obligation on the local authorities of some scale.

That is not going to improve the position on affordability in the short term, even if you believe that there'll be a lot more supply in the future. There won't be a lot more supply to change the affordability equation over the next 12, 18 months, we do think the affordability equation is key if we want higher volume levels.

We're doing the self-help. We've got a shared equity offer, we're doing part-exchange, we're providing good incentives to our customers.

Government stimulus would be a game changer in terms of the demand side. The industry, it's not only Barratt Redrow, but I think the industry have been kind of uniform in saying that they're quite happy to pay.

We launched the scheme with government back in 2012, and we paid for that scheme. The reality is that we're very happy to pay for the scheme, but we think it would be a game changer, and that would be particularly true in terms of London and the South East.

Mike, do you want to? You're panicking then, were you, John?

Yeah. Yeah.

I feel like I might just be repeating what David said when he answered the question, but just trying to add a bit more color. We certainly saw after the budget a level of interest and leads and web visits and the like from the market.

I guess that's because there was no negative news in the budget around housing. I think that carried on through Christmas, and we have seen an uptick since the October-November performance in the trading since Christmas.

I think in the slides we say that it's very slightly down year-on-year. I think there's a slight anomaly maybe in the first week, but if you look at more recent trading the last four weeks or so, five weeks, then that is in line year-on-year and gives us every confidence that we'll hit our full-year completions.

Really the message is it's year-on-year, it's the same, and we're confident we'll hit our completions. Just Alison, I think, in the middle there.

Morning. Two questions from my side.

One is on this following up on the demand stimulus. Because if you said builders are happy to contribute to the scheme, do you think that it will probably increase the chance for the government want to actually launch something given right now there's a lot of political noise going on right now as well?

The second is on the outlets. If I can follow up a little bit as well, because you said 2027 you're expecting average outlets around 425 to 435, right?

That's probably an incremental of around 20 to 30 year-over-year. I might remember it completely wrong, but I think previously you are probably more guiding around 30 incremental outlets opening.

I don't know if there's any color you can give, maybe the planning environment or maybe why it's not hitting the 30 level, instead it's 20 to 30? Thank you.

John will pick up in terms of the outlets. Look, I think in terms of government, I do understand that the government position in terms of funding generally has got challenges.

I think the reality is that the housebuilding industry, mainly through the HBF, our trade body, have been very clear that if there was a new scheme, then the housebuilders would expect to pay for it. As I say, we launched the scheme in conjunction with government in 2012, pre-Help to Buy, and we paid for that scheme.

I don't think the idea that the housebuilders paying for a scheme is unusual. Yes, of course that will help, but there are clearly other considerations that the government have to take account of.

Then, on the outlets, your maths is correct, Alison. Broadly 20 to 30.

I think we were more at the 30 end of the scale; I think we still are, but we just have to be pragmatic in terms of I think everyone in the room is aware that planning is taking time, and Mike mentioned it earlier, to see the actual on-the-ground benefits of that coming through. We're shooting to deliver 30, but clearly setting a banded range there, 20 to 30 outlets, just looks a prudent position to be holding.

Clearly, all of our divisions and all of our teams are working damn hard to try and pull through outlets and get them open, because ultimately that's going to drive our top line and drive the volume growth as we look forward. Thanks.

Zayn, next door, and then I'll come forward.

Morning, thanks for taking my question. The first would just be on the PRS market, the view for the remainder of the year and what's in your expectations.

Then secondly, I think you mentioned 31 planning applications submitted and 16 approval 16 received back. Sort of any anecdotes on how easy or quicker has those been since all the government changes?

Thank you.

Of course. If I pick up those.

I think in terms of PRS, again just in context, the PRS market was building a lot of momentum pre the budget in 2022. The reality is that the funding costs for the PRS operators, as they did for everyone, changed fundamentally.

I think there was less activity in the marketplace, first of all. Simply less people looking to buy PRS.

I think we're seeing the return of more interest in terms of PRS. We announced in I think in '21, and it became effective in '22, our cooperation with Lloyds Bank and Lloyds Living, and we have undertaken three groups of transactions with Lloyds Living.

We've undertaken transactions with other PRS providers as well. We felt that setting a range of 5% to 10% of our completions being through PRS was a kind of range that we felt comfortable with, which we set out last year.

We are definitely still looking to do PRS, but we're only looking to do it at the right price. It's something that can work very, very well for us in terms of return on capital employed, very well in terms of the efficiency of our build teams, but we've got to make sure that we are pricing it properly.

I think in terms of planning in relation to the synergy sites, I don't think there's been any particular issues. Bear in mind that these sites have already got a detailed consent.

We would probably have expected to have been able to agree more plot substitutions rather than having to go to a full committee. That kind of is what it is at a local level.

Again, we're very confident we will get the planning and we will get those outlets through as we outlined in FY27.

Alastair, down the front, and then back to Rebecca.

It's Alastair Stewart from Progressive. Three questions based actually on one slide on, well, one chart on slide 7.

In terms of the moving parts in the private reservation by buyer type, the biggest change was in part-exchange, going from 14% to 23%. Obviously, Redrow's greater uptake is a big part of that, but was it all?

Within part-exchange, do you get a sense of how many people using it in the second-hand going into new, is it they have to use it because they just get stuck in chains elsewhere, and how much is it a nice to have? Then the next one was first-time buyers going from 31% to 33%.

Do you get any sense in there how much is Bank of Mum and Dad and how much is using your own part-exchange? Then finally, following on from the previous question, PRS and other, going from 9% to 4%, you said you were originally aiming at 5% to 10%.

Is it going to take some time to get to the top of that range, or are the financial costs for PRS investors just too high at the current moment?

Thanks, Alastair. I've never had three questions on one slide.

Right, well, I think we're going to have a bit of a joint go at this one. If I pick up in terms of PRS and first-time buyers, and if Mike picks up in terms of the part-exchange element of it.

I think on first-time buyers, look, unquestionably, the Bank of Family, as I think it's referred to, is very, very important. Now, I can't say this is the percentage because, as we're separate from the independent financial advisors, we don't really get into the nuts and bolts of that.

I think it's well-documented that that has become more and more important post-'22 as interest costs have risen substantially. It's good to see a little bit of a tick-up generally in first-time buyers.

As we've touched on in some parts of the country, particularly London and the South East, I think first-time buyers are largely priced out of the market, even in some cases with Bank of Family, looking at deposit levels that are well in excess of £100,000 for a lot of purchasers, because they don't want to be in there on a 95% loan-to-value; they want to be in on a 85%, etc. That's the first thing.

In terms of PRS, look, we can unquestionably operate in a 5% to 10% range. The deals tend to be quite large.

They might not all be delivered in the same year, but I think you would tend to be looking at deals that would be, for us historically, between 250 and maybe 750 homes. That might be delivered over two financial years, but it can have a significant impact, one deal, in terms of the percentages.

At the 4% percentage, we're obviously just outside that range, but we are hopeful of closing some PRS deals certainly in calendar '26, which will materially alter those percentages. Mike, do you want to just talk a bit about PX?

Yeah. We have introduced our PX proposition more heavily into Redrow, and that's seen an increase.

Part of that increase is certainly just the extra volume that's coming through Redrow. It's not all of it, by any stretch of the imagination; it's a more popular incentive that our customers are utilizing.

I think the reason for their utilization is I think there's many factors. A lot of it is around just simplicity in that clearly we sell their houses eventually, we don't carry PX for the next 12 12 months that they can't sell, they could sell their houses.

It's just about simplicity. There's an element of when somebody visits the site and set their heart on a plot, if they're not in a position ready to go, if they PX, we can take that reservation, they can reserve the plot that they want.

A lot of it is around consumer choice rather than necessity. Does that answer the question?

I think that's it, yeah.

Great. Glynis?

Got no red light. Can you hear me?

Yep.

That was good.

All right. Cool.

John, I'm going to throw some at you, actually. Just a few that hopefully are very short answers.

I'll reel through them. Given the order book on the affordable, what should we anticipate in terms of the affordable-private mix this year and maybe into next year?

Second of all, the gross margin on your acquired land, can you confirm what you're actually buying in at? Thirdly, just in terms of the completed development provision, what was it last year?

Is it always around that level? If this year's was unusual, why?

Next, the third-party payments for the build safety provisions, so that's in the gross profit, but you're taking the legal fees for getting them in the adjusted, is that correct? Then two that require perhaps a little bit more color: one, the size of the outlets, is that to do with just the fact you're putting three ranges on it, therefore each size of site is three outlets?

How should we be expecting that average size of outlets to progress? Then lastly, just in terms of the land approvals, obviously the guidance has changed quite substantially.

Can you give us a bit of color about why that's happened and what that might mean, one, two years out?

Right. Okay.

If we start off, we can't do just one word on each, but we'll try. Order book affordable through the mix, I think if you look at 10 years for us, you would conclude that somewhere around 20%, 21%, that sort of level is what we would deliver in terms of affordable housing.

What we saw last year was really quite an unusually low level of affordable housing, a lot of which was driven from Redrow because Redrow had been very high in the year to June '24, in terms of the sort of pre-acquisition position, Redrow was very high in that year. When you look forward, I would think that kind of 20%, 21% is what we should look at.

In terms of gross margin on acquired land, we've said that we're acquiring on a gross margin at 23%. We're very comfortable with that in terms of the forward acquisition position.

Once all of our cost and procurement synergies are embedded, we should be acquiring on a gross margin at 24%, which is just in line with what we said last year. The CDP, I'm going to pass to John, because I'm not sure I understood it, I'm just going to pass it to John.

Then building safety, anything relating to building safety should be in adjusted. The legal fees in respect of recovery are in adjusted, and any recovery of costs would be part of our adjusted provisioning and therefore is in adjusted.

We're not putting the recovery in gross margin and the costs in adjusted. Everything else is over to you.

Right. Yes, just on that one, gross profit, the ones I quoted here were excluding that £13.4 million gain.

We're obliged to recognize that through income rather than take it as a deduction against our provision as well. Just the IFRS rules we operate within.

On the completed development accruals provision, that does tend to move around a little bit. If you look back at the full year, it was a credit, it helped us at the last full-year set of results.

It does kind of ebb and flow depending on sites and the number of outlets coming to kind of closure basically as well, Glynis. When a site closes out, you obviously then have that period.

It's waiting for local authorities to adopt is the big issue there. It does tend to ebb and flow, but it's the incremental, that's the change year-over-year, you can see that impact there, but happy to talk about afterwards.

Outlet size, coming on to that one. If you look at the outlet size, we're talking if we look at a development, we think of developments, and then we think of outlets.

Clearly, as we look at particularly land deals that involve larger-sized developments, that's where the opportunity is for us to bring on two or three brands to optimize those at that kind of 140, 150 per sales outlet, which then gives you the lifetime of three to four years. As we look at land opportunities and how that will be driven by development activity, it's looking at those and thinking, okay, well, what can we do here that will optimize the brand choices?

That is kind of the differential there. It's all about trying to optimize the speed at which we're going to be there with the showhome, with the sales team, building out and completing the sales.

On the other one, on approvals, really more a function of just the opportunities in the market, but also a deliberate point for ourselves is that that pipeline that David mentioned on strategic land conversions, we've got a hopper there of about 27,500 plots. Now, those have all gone into planning across 103 applications.

The timeframe over which they may come through on planning is something we want to be prepared for, and therefore the focus has been on really optimizing the existing landbank, because obviously we're sitting there in excess of 5.5 years when you look back six months ago. For the last six months, it's been about what can we do across the portfolio, either splicing and dicing the current land, but also looking at our strategic and what's going to come through.

This will give us flexibility to in-fill and to look at the strategic stuff as that comes through and then look at elsewhere in the market. I think that will hopefully cover that one there, and I think that covers the lot.

Sorry, Glynis, just on the consented plots number, you can see that over the last three reporting periods it's reasonably consistent. Just to illustrate it, when we add in the revenue synergy outlets, what we should do is see an increase in outlets and no increase in plots, and therefore the revenue synergy outlets will drive that number down.

I do think that when you look at the landbank, that number is very important, because that is a kind of measure of the sort of raw efficiency of the landbank. I.e., if you've got one site for 1,000 plots, the answer is 1,000, and if you've got three sites on that 1,000 plots, the answer is going to be 330.

I think it's an absolutely key measure in terms of looking at that efficiency ratio.

Rebecca, then we'll couple more after that, conscious of time.

Hi. Just a couple from me.

The first one, just wondering if you can talk to kind of how that net cash balance moves into the year-end. I think you're sitting about 170 the half, but expecting 400 to 500.

Just some of the moving parts there, knowing that there's going to be some more volumes coming through, but then I guess an increase in WIP as you increase your outlet profile. Then just following on the approvals on the landbank question before, would we expect to see the landbank, I guess, roughly stable here as I guess you're doing less approvals, but getting more from your strategic landbank?

Then on the outlet opening profile as well, just wondering how many of those 20 to 30, I guess, increase in outlets you think that you'll be doing dual or triple-branded outlets, how many of those outlets? Thanks.

Okay. If John picks up in terms of the net cash balance and how that will progress towards the year-end.

Then I think I'd ask John to pick up on the outlet opening profile. What I would say on the outlet opening profile is that, which I'm sure John will just restate that position, but we are talking average outlets.

Therefore, if we are saying our average outlets are going to move from just above 400 to 425 to 435, we've obviously got to open a lot more outlets during the course of that year. John can maybe just outline that in terms of figures.

I think in terms of the landbank and the approvals, we feel that we have a lot of flexibility. We've set out what I think is quite a strong growth agenda in terms of our outlets profile, to move from where we are now to a sort of a net outlet position of around 500, broadly we're moving from 400 to 500 over a period of time.

I think with our landbank at 5.6 years and the strategic sites that we have in for planning, we see that we have a lot of flexibility. We've set a target, which we'll obviously keep under review, but we've set a target of between 10,000 and 12,000 for this year.

We'd be happy to be at replacement level, if in FY27 we were at replacement level, say. The reality is we are very happy to shrink the landbank as long as we're delivering the required number of outlets.

I think we see that drive to 500 outlets as being the absolute key thing that we're trying to achieve.

Maybe just before going to cash flow, just finishing off on the outlets point. I guess certainly when we think about the 30 synergy outlets that are opening, by default, they're dual because they're an existing site that's adding Redrow to it or Barratt or David Wilson onto a Redrow.

I will get hold of some numbers so we can always share them with you, Rebecca, but primarily it's dualing, but there are, I think, a handful of triple sites as well. Within that mix of synergy sites, some of them were already David Wilson and Barratt and are having Redrow added to them.

I think there's half a dozen that will be ultimately broadly triple-site opportunities once we get through there. Then on cash flow, I guess three, I think, big ingredients really in terms of cash flow performance in the second half.

First is clearly operating profit, our profit from operations in the second half should start as a significantly higher number. If we look at our working capital and particularly the construction WIP, where we had that 313 outflow including part-ex, broadly three quarters, if not more of that, should come back in the second half, given the seasonality of our working capital cycle in terms of completions in the second half.

The other one in there is then land, where we would expect, as David mentioned, we're probably going to actually end up unlocking a bit of value in land in the second half. If you put those together plus the dividend, obviously, in terms of the interim going out, which is broadly 60 million, and the buyback of 50, those together should get you back to that kind of somewhere between the £400 million and £500 million net cash at the year-end.

Thanks. Conscious two more.

Charlie, and then we'll go to the back, and I think that will probably be our time limit. Charlie?

Thanks. Thanks, John.

Thanks for taking the question. Charlie Campbell at Stifel.

Just one really. Just on mortgage availability, not something you've talked about today.

There are clearly quite a few changes going on there. Just wondering what the banks are telling you in terms of mortgage availability for, let's say, calendar '26, any changes there?

I suppose just to help us think about that a bit more, any changes in the customer mix in January versus, I don't know, say July, for the sake of an argument, before people started to worry about property taxes in the other direction?

Charlie. If I pick that one up, I think the mortgage backdrop is a gradually improving backdrop.

I would say from probably three particular points. One, from a regulatory point, that there has been a freeing-up of the regulatory environment in terms of, as an example, the earnings multiples that is allowed to be lent.

There's no question there's a freeing-up of the regulatory environment, which is a positive, but it's obviously been a relatively slow burn. That is good.

Secondly, I think generally there are more and more mortgage offers that are at 95%. Now, the reality is that that isn't necessarily fully addressing affordability because the 95% mortgages can be expensive, and therefore if somebody is comparing that to renting or staying at home, it isn't necessarily giving them what they need.

Then I think the third area, which isn't particularly big for us, but it's certainly big in London, is that there has also been more of a movement to higher loan-to-values on apartments. We came from a situation, albeit a long time ago, where most banks were lending perhaps 10% different as a maximum LTV.

If they were at 90% on houses, they would be at 80% on apartments. Again, we've seen some freeing-up in terms of that environment.

I would say overall that there's not any big change in customer mix. To some extent, I know it's both product and customer, but we're giving some indication of customer mix on the slide that we went through in the Q&A.

I think there's two customers that can really just sit out the market. In periods of uncertainty, one is a first-time buyer who, I would say, generally can sit out.

They would normally be living at home or renting, and they can sit it out for some period of time. The other category of customer who can sit it out is the downsizer.

The downsizer was a significant part of the Redrow business. I don't think that those are customers that have gone forever, almost by definition.

The first-time buyer and the downsizer can come back into the market, but they can certainly sit it out. Redrow have seen that in terms of maybe where they were on cash sales, circa 40% of their business was cash sales, and they're now round about 30% of the business being cash sales.

That will be primarily downsizers sitting it out.

Peter, did you have a question starting?

Thank you. Peter [Ajderian?]

from Morgan Stanley. It was a similar question really just in terms of the growth going forward, which customer segment do you expect to grow the fastest, just because when I look at some of the metrics on first-time buyers, I think one in three now in terms of purchases in the UK will be first-time buyers.

There's perhaps a notion that maybe not to disagree with you, but they can't sit it out because maybe they've got family formation or they'll do more to kind of get it done. Just in terms of where you think the growth will come from if first-time buyers are starting to run too hot in terms of the level of completions they make up in the UK.

Also maybe if you can give some color on how down it is from the peak for you, first-time buyers in your business?

Okay. Thanks.

That's quite a big question. I think if you step back from it for new build and for Barratt Redrow in particular, I think a really big opportunity for us over the next three to five years is about the efficiency of our homes and the substantially lower running costs of our homes.

Therefore, I think from a Barratt Redrow point of view, I would say that we mainly want to take market share from the second-hand market. We don't mind if they're first-time buyers, second-time movers, or downsizers.

We should be actively seeking share. We can do that, as we've talked about, through a part-exchange offer for existing homeowners, but we can also do that through demonstrating substantially lower running costs.

The running costs are not just about the heating or and so on. The running costs are also about you don't have to put in a new bathroom or a new kitchen within the first two or three years.

In cash terms, there are big, big benefits of new build. That's the first area that we should look at.

Then really in terms of the mix point, I would say that we should expect to see more growth on first-time buyers and more growth on downsizers across the piece. I do think for downsizers that there is more we could be doing in terms of part-exchange offers with downsizers, and that's something that we've been looking at quite actively, because we would tend to say that your house can't be worth more than the house you're buying, and therefore that precludes a lot of downsizers.

I think that's something where we need to challenge ourselves in terms of how attractive we can be to downsizers. I think you see on downsizers that a lot of what they want is low maintenance, low running costs, and not having to think about replacing kitchens and bathrooms and so on.

Great. I think, conscious we are 10:00.

Any last ones? Otherwise, thank you, everybody.

Hand over to David.

Yeah. Thank you very much.

I appreciate all the questions. Thank you.

We will be back in April with a trading update. Thanks very much.