Barratt Report H1 Loss But Expect Significant H2 Improvement
Barratt Developments Plc, the U.K.'s largest house builder by volume, today said it made a H1 pre-tax loss of £48.5 million before exceptional items, but expects significantly better margins in the second half of the year after improving its trading performance in the first half.
Chief Executive Mark Clare said: "During the last six months, we have improved our trading performance, successfully refinanced the business and invested in new land. The value of our forward order book is now up 27% year on year and with our ongoing focus on optimising selling prices we are expecting to see significant improvements in operating margin in the second half."
The company said that total completions for the six-month period ended Dec. 31 were down to 5,053 compared with 6,905 in the same period a year earlier. Revenue fell to £872.4 million from £1.26 billion. The average selling price increased 3.5% to £166,300, driven by changes in mix. Operating margin increased to 2.4% from 1.3% in 2008.
Barratt Developments, like its rivals, has been hit hard by one of the worst housing downturns in decades. But as demand for housing and house prices slowly recover, Barratt is planning to go through its land bank quickly and start developments on new land to achieve higher margins.
Since mid-2009 the Group has agreed terms on £358million of land, comprising 74 sites and 9,038 plots, with an average plot cost to average selling price ratio of 20%, which will deliver attractive margins based on current selling prices.
The company previously said it plans to increase margins to their peak levels in three to four years.
Barratt cut its net debt to £605.3 million at Dec.31, a reduction of £671.6 million since June 30, helped by the net proceeds of its Placing and the Rights Issue, the sale of a commercial property and ongoing strong cash management.
Exceptional items of £129.9million primarily related to the Group's amended financing arrangements, which came into effect following the Placing and the Rights Issue.
Barratt Development shares closed at 122 pence yesterday, giving the company a market valuation of £1.17 billion. The stock traded at 43 pence a share a year ago, but has rebounded on hopes of recovery.
Questions and Answers
A specialist real estate agent can help to buy commercial real estate. It is inadvisable to go to agents that are one-stop-shops for real estate, selling residential, commercial and even international property. You will get a much better level of service and wealth of experienced from a long established estate agent who specializes solely in offering commercial property to buy.
Leading forecasters are predicting the continued recovery of UK commercial property values in the new year. The IPD index shows a remarkable rebound, and total returns may even become positive after the largest monthly rise ever in the history of the index in November of 2.4%.
Dragon's Den Star James Caan is teaming up with ING for a new UK commercial property fund.
Listed property companies raise £4.6 billion to stabalise the UK Commerical Property market.
As another news report (this time from Reuters: ‘UK high street property woes gain as retailers teeter') about the number of shops closing down, I can't help but compare the content of this article – and the many other ones like it that have been published recently – to our own situation. As I wrote in a recent blog (The bigger they are, the harder they fall) we have been trying to secure second premises for our kitchen design and installation business, Nicholas Hythe Kitchen Design Studio...
The company introduces property regulatory practices, photo bank, 3D walkthroughs and company branded-car site visits and plans new property broking standards through trust, transparency, technology and pan-India presence
financial crisis has conned everyone's live. Mass layoffs were happening in everywhere which is very sad. Throughout the crisis era not really a couple of companies go under. This will make the company managers searching for the best and accurate online marketing strategy to enhance the productivity and efficiency of the organization. The best online marketing strategy is really a way to succeed.
Business needs customers to make profit and survive. It's as simple as that. Without doing any marketing no-one knows you exist and you're not going to get too far. So, if you're in serious business, you have to get your message out.
Is your company on the lookout for a plush new office in London? If so there is plenty of different choice as regard areas and plenty of choice when it comes to office space, Lloyd's area of London being a prime example of what is on offer.
The Digital governors are designed not just to take control of the speed of the machine but it also allowed the machine to be smarter, allowing automation and improved functionality for the engine. By implementing these governors, the system became more stabilized and reliable, and there is no more need to add diesel generators that consume precious fuel and is expensive to maintain
If you're heading to Australia for business, you'll discover a world-class destination that's at the cutting edge of many industries. Australia is also ideally located for business opportunities in Asia, and it has a sturdy economy, exceptional facilities, good communication services and strong institutions.Here's just a brief introduction to the essentials for business travellers.
An increasing number of landlords are looking to acquire properties with buy-to-let residential mortgages, if recent suggestions are anything to go by.
Henry Boot Plc, the Sheffield -based developer and contractor has announced it swung pre-tax loss for FY 2009 ended 31st December, of £11.9 million, after a revaluation deficit of £22.4 million was taken into account. In 2008 it made a pre-tax profit of £19.3 million.
Mitchells & Butlers today published the results of a strategic review of the business, the conclusions of which have been adopted as operating policy immediately. The review takes place after Joe Lewis, the largest shareholder had installed John Lovering as Chairman after the dramatic AGM in January.
Songbird Estates Plc, owner of the Canary Wharf Estate, today reported a move to full year pretax profit and said its adjusted net asset value per share was up on the previous year.
Discuss this Article
