Barratt Developments shrugs off Brexit pressures with strong first half results
Housebuilder Barratt Developments has reported a rise in half-year sales and profits as it continues to benefit from operating efficiencies.
The country’s largest housebuilder posted a 7.2% rise in revenues to £2.1 billion in the six months to December 31, while pre-tax profits jumped 19.1% to £408 million.
Chief executive David Thomas said: “Operating efficiencies are delivering improved margins and our controlled and disciplined business model means we have a high-quality land bank, strong forward sales, excellent financial position and efficient cash flow generation.”
Construction efficiency improvements were attributed to new house-type ranges and the use of modern methods of construction.
Barratt said demand continues to be supported by the UK Government’s Help to Buy initiative for first-time buyers, as well as the wide availability of “attractive” mortgage finance.
Completions in the first half came in at 7,622 homes, up 4.1%, while the average selling price of homes was broadly flat at £282,200.
Total forward sales were up 7.3% at £3bn and the outlook for the full year remains in line with expectations.
On Brexit, Barratt said it is working with suppliers to ensure the “continuity of supply of non-UK manufactured components”, as it seeks to mitigate chaos at ports in the event of a disorderly exit. However, despite the wider economic uncertainty that Brexit is bringing, Barratt insisted it is in a strong position.
Mr Thomas added: “Whilst we continue to monitor market conditions closely, current trading is in line with our expectations and we are confident of delivering a good financial and operational performance in full year 2019.”