Increases in selling prices and forward sales boost growth
Barratt Developments is expecting to make a profit in the second half of this year following a £63.5m loss in 2009.
The group announced the predicted swing today in an interim statement covering the year to 9 May. It added that forward sales have risen 32% since this time last year, currently standing at just over £1bn.
Completions for 2010 are expected to be up to 11,500 units, with houses representing around 60% of total volumes compared to 46% in the year before and terms have been agreed on £447.8m of land equating to 12,286 plots since mid-2009.
Mark Clare, Barratt’s group chief executiv,e said: "The increase in our selling prices coupled with effective cost control is leading to good margin growth and we expect to deliver a profit for the second half. Our forward sales now exceed £1bn, the highest level we have reported for two years, and we're continuing to secure highly desirable land that meets our hurdle rates and will further accelerate our margin recovery. Nevertheless while the market has seen a measure of recovery we remain cautious given continuing economic uncertainty and constrained lending."