NORTH East housebuilder Barratt is back in the black with profits for the last 12 months expected to top £40m and earmarked to more than double to £90m in the coming year.
Barratt is still way off its house-building peak with annual completions now running at about 11,000 compared to 22,000 five years ago when the market was buoyant.
The Newcastle-based company has reported a slight fall in completions during its financial year, and said the market remains ‘challenging’ outside London and the south east.
It said in a trading statement that it had increased its operating margin in the second half of the year, to around 7.8%, compared with 5.9% in the second half of 2009/10. It expects pre-tax profits for the 12 months ending June 2011, before exceptional costs to be around £40m compared to a loss of £33m in the previous year.
Barratt’s net debt stood at £330m on June 30, this year, down from £366.9m at the same point last year, and the company has secured £1bn of finance to fund its progress over the next four years.
It completed 11,171 homes during the year ending June 30, down from 11,377 in 2009/10.
The launch of the Government’s FirstBuy scheme, which gives first-time buyers access to the housing market on a deposit of around 5%, is proving to be a shot in the arm for housebuilders.
