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Barratt’s profit outpaces completions
The UK’s largest house builder boosted its profits by more than £80m, but built roughly the same number of homes, it said as a number of UK builders issued their annual results.
Barratt’s profits before tax grew 12.5% from £662m to £765m, while its completions increased slightly from 17,319 to 17,395, it announced in its annual statement. The group said that despite the recent general election, market conditions remained good and proposed reforms to the planning system were welcome.
Barratt built 23% more affordable housing in the year to June 2017 than the previous year, continuing a growing trend it previously noted in July, although David Thomas, its chief executive, said then that he aimed to decrease this proportion.
In response to these results, Mr Thomas said: “This has been another excellent year for the group. We have delivered a strong operational and financial performance and our highest completion volumes for nine years. We are committed to increasing the supply of new homes as the UK’s largest house builder and we remain industry-leading in terms of quality and customer service.”
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Berkeley, on the other hand, warned that uncertainty on Brexit was damaging the London market and complained for the second time this year that affordable housing requirements are too stringent for current market conditions.
In a trading update, Berkeley said that it was still on track to deliver its target of £3bn profit over the five years to April 2021 and that profits for the current year would be “at least as strong as 2016/17”.
The builder also appointed Peter Vernon, a Peabody trustee, to its board.
Bovis Homes recorded a 31% fall in its profits in an update for the six months to June 2017, falling from £62m in the same period last year to £43m, as its completions also fell from 1,601 to 1,512.
Greg Fitzgerald, chief executive of Bovis, said: “The first half of 2017 has been a period of stabilisation and strategic reorganisation for Bovis Homes Group. Since joining the business in April 2017 I have visited all our offices and the vast majority of our developments, and have been hugely impressed by the desire of our dedicated staff to address and rectify the challenges faced by the business.”
Meanwhile, the UK’s leading retirement house builder, McCarthy & Stone, saw a recovery in its fortunes after announcing a dramatic fall in profits in April. It said its strategic partnership with Places for People, involving a sale of 126 apartments across 27 sites, had enhanced its business model.
