Housebuilder's trading statement warns of poor expected performance for 2009

Housebuilder Redrow has said sales in September and October this year were 鈥渆xtremely fragile鈥� due to limited mortgage availability.

In a trading statement this morning it added that the outlook for 2009 was 鈥渧ery weak鈥�.

The last two months' trading saw:

- A 45% fall in net reservations from 2007

- 38 net reservations from 93 sales outlets

- A cancellation rate of 21%

- 拢300m net debt at end of October, a figure in line with expectations.

On the upside, it said there was a 鈥渕odest seasonal upturn鈥� in trading in September and October and that cashflow was on track.

Charlie Campbell, an analyst at Liberum Capital, said: 鈥淐ashflow is the key measure for investor confidence at the moment and it bodes well for the sector.鈥�

Redrow added that the residential land market was 鈥渋nactive鈥� but it was exploring 鈥渁 number of non-residential opportunities鈥� for parts of its landbank.

Rachael Waring, an analyst at Panmure Gordon, said the statement was broadly in line with forecasts. She said: 鈥淲e believe pricing is worse than our expectations at this stage of the cycle, constrained by low levels of mortgage liquidity and low consumer confidence.鈥�

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