Promising start to 2008 for Barratt Homes

Source: Construction Digital

Date :28/02/2008 09:12:24

Britain’s second largest house-builder has followed Persimmon’s positive outlook by reporting a ten percent rise in profits for the half-year ended 31 December 2007.

In a statement today Barratt, which bought rival Wilson Bowden for more than £2 billion in April 2007, went on to say that completions fell by 14.8 percent to 9,056 homes in the period, but the average selling price rose 7.9 percent to £178,000 as it raised its focus on premium homes.

The company also revealed that pre-tax profits climbed more than ten percent to £194.6 million, while turnover increased 38 percent to £1.65 billion.

These figures were largely increased by the Wilson Bowden acquisition, however. On a like-for-like basis, turnover dropped 17.4 per cent while like-for-like operating margin slipped 0.5 percent to 16.8 percent.

Adjustmant

“Trading conditions over the last six months have been difficult and the business has had to adjust to this new environment,” said Mark Clare, Barratt’s Group Chief Executive of Developments.

“Against that backdrop, we have traded satisfactorily whilst successfully completing the integration of Wilson Bowden. We have focused on improving every aspect of the business and this has underpinned a robust margin. We are continuing to reduce costs, whilst improving sales effectiveness to ensure that prices and volumes are maximized,” he continued.

“The new calendar year has started well. We have increased outlets, and have a strong forward order book. Visitor and reservation levels continue to improve and we remain optimistic that this will continue through the balance of the spring selling season.”

On Tuesday, rival Persimmon said its visitor numbers had also by a similar amount but had noted a similar improvement in recent weeks.

February 28, 2008