Housebuilder's pre-tax profit falls to £137.3m despite 6% rise in selling price
Barratt Developments has announced a sharp fall in profit as the housing slump crushes the market.
The UK housebuilder said that its pre-tax profit totalled £137.3m in the year to 30 June 2008, down by 68% from the same period in 2007.
However, its average selling price has risen 6% as a result of high-value sales in upscale locations in London.
Turnover rose 16.7% to £3.6bn, up from £3bn in the previous year. Forward sales at 30 June 2008 were £697.6m, down from £1.4bn at the same point a year earlier.
Mark Clare, group chief executive, said he believed the firm had achieved “satisfactory results against the backdrop of a rapidly deteriorating UK housing market”.
The results come after a tumultuous year for the housebuilder, which arranged a relaxation of its lending agreements with its banks in July.
Its share price has climbed steadily since, but many analysts have said today that they fear further land writedowns will be needed.
Barratt's shares were up 5% to 165p in early trading.
In July, the housebuilder announced that it would be cutting more than 1,200 jobs.