House builder Redrow has seen its revenue fall by more than half in just twelve months, as the financial crisis continues to constrict mortgage lending.
Revenue for the home building company fell from £353million in 2007 to £149.5million in 2008. Redrow cited reduced sales and falling house prices as the primary causes of its decline.
Redrow, like other house builders, was one of the first hit by the credit crisis as mortgage
finance dried up. As a result, in the twelve months to December 2008, the firm reduced its workforce by 43 per cent to 740 employees.
However, as the credit crunch turns into a recession, and mortgage lenders
show no signs of relaxing their policies, Redrow has warned that it expects to cut another 90 jobs early this year.
Year on year, Redrow's house sale reservations were down 49 per cent to 853 from 1.657, meanwhile, its average house sale price has fallen 14 per cent to £140,500 from £162,700.
Commenting on its plight, chairman of Redrow plc, Alan Bowkett said: "Redrow responded early to the unprecedented market conditions, taking swift and decisive action within the business.
"We have implemented a major cost reduction programme which is delivering significant savings and we are executing tight control of our cash flows. In both these areas we are ahead of our plan."
In terms of the company's future, Mr Bowkett added: "Our strategy in the medium term remains focused on the strength of our forward land bank and the delivery of a differential product to our customers."
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