The sharp market reaction came as the company revealed a £98 million hit from legacy building safety costs, dragging full-year profits around 10% below previous expectations.

While underlying pre-tax profits are still expected to be in line with revised market forecasts of approximately £583m, this represents a significant downgrade from earlier consensus estimates of £712m.

The £98m charge relates largely to fire safety issues identified at four buildings completed in 2002 in the south of England and additional remedial works at a major London development. These latest provisions form part of a wider £229m in adjusted charges, including £29m linked to the Competition and Markets Authority’s ongoing housebuilding sector investigation and £66m in Redrow-related restructuring costs.

Despite the profit impact, Barratt Redrow reported signs of operational resilience and progress on its strategic priorities. Total home completions for the year were 16,565 – slightly below guidance but up from the 14,004 delivered by Barratt alone in FY24. Private reservation rates rose 16.4% to 0.64 per outlet per week, boosted by steady demand in the private rental sector and strong partnerships with institutional buyers.

Integration of Redrow, acquired for £2.5 billion earlier this year, is said to be progressing ahead of schedule. The Group confirmed it had already delivered £69m of cost synergies, with £15m benefiting FY25 earnings and a further £45m expected in FY26.

Reiterating its confidence in the medium-term, Barratt Redrow said it expects completions in FY26 to rise to between 17,200 and 17,800 homes, including approximately 600 from joint ventures. The company remains committed to its ambition of delivering 22,000 homes annually in the medium term, supported by a healthy forward order book of £2.92bn and a net cash position of £772m.

The company also continued to lead the industry in quality and sustainability, with 115 NHBC Pride in the Job Awards and a 5-star customer satisfaction rating for the 16th year running. It was recently named one of the World’s Most Sustainable Companies by TIME and remains the only UK housebuilder on the CDP’s Global A List for climate leadership.

David Thomas, Barratt Redrow’s chief executive, described the year’s results as “solid” against a difficult backdrop: “Although demand during the year has been impacted by consumer caution and mortgage rates not falling as quickly as hoped, there remains a long-term structural undersupply of housing in this country. Our increased scale, three market-leading brands and strong land pipeline put us in a unique position to accelerate delivery as market conditions improve.”

However, the market’s response was more cautious. Shares in the company closed down 9.4% at 377.3p.