Barratt Developments says new financial year off to a strong start

11th Sep 2013 07:03

House-builder Barratt Developments delivered a strong set of annual results, as the housing market recovery starts to spread beyond London, and said the new financial year has started on a strong footing.Profit before tax and exceptional items increased to £192.3m for the year ended June 30th from £110.7m the year before. Revenues for the year rose 12.2% to £2.60bn, with completions including joint ventures rising to 13,663 units from 12,857 units in 2012. Operating profit before operating exceptional items for the year rose 32.2% to £252.7m. Operating margin increased to 10.4% from 9.5% in the second half and to 9.7% for the full year, up from 8.2% in the prior full year.The average selling prices increased to £194,800 from £180,500 in 2012 with private average selling prices increasing by 6.0% to £213,900.Chief Executive Mark Clare said: "We are seeing the housing market recovery starting to spread beyond London and the south east with a 29.4% increase in our average net private reservation rate across the group. "Our £2.6bn commitment to land investment since 2009 puts us in a good position to capitalise on these market trends."We have already increased our completion volumes by over 20% in the past two years and expect to deliver around 45,000 new homes over the next three years."Average net private reservations per active site per week have increased by 29.4% in the first ten weeks of the current financial year."Current market conditions are very positive. We have seen a significant step-up in consumer demand and mortgage supply, enhanced by the introduction of the government Help to Buy scheme," the group added. "The strength of current trading and our forward order book, coupled with the expected delivery of around two thirds of completions from higher margin land, gives us confidence of another substantial improvement in performance in the full year 2014."Net debt at June 30th 2013 was reduced to £25.9m from £167.7m before.Barratt is proposing a final dividend of 2.5p per share payable in November and is adopting a progressive dividend policy with a target of three times dividend cover for the full year 2016.CJ