Barratt margins improving, cautious outlook

14th Jan 2010 07:32

Housebuilder Barratt said margins are growing and reported a 43% increase in total forward sales, but added that while the market has improved, there are still major uncertainties of both mortgage finance and the general economic outlook.Barratt said it built 5028 homes in the year to June and expects to meet its full year target of 12,000.The housebuilder said operating margin for the six months to 31 December 2009 is expected to be around 2%, up from 1.3% in the prior year. Total average selling prices increased by 4% to around £167,000, largely driven by changes in mix, the group said. Prices are expected to increase by 8 to 10% by the end of its financial year.Net debt has been reduced to around £610m from £1,276.9m at 30 June 2009 after the group completed a rights issue and placing in November 2009.However on a cautionary note, chief executive Mark Clare said, "Whilst the market has seen a measure of recovery over the past six months, we remain cautious, with growth likely to be constrained by economic uncertainty and a lack of mortgage finance, particularly in the high loan to value sector."