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Barratt Developments reports strong start to second half

 

 

 

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Barratt Developments (LON:BDEV) shares edged higher early on Thursday as it reported a strong start to the second half.

Since the UK government's "Help to Buy" scheme was announced on March 20 and the subsequent launch of the shared equity loan scheme on April 1, the group has seen a step up in consumer interest and a strengthening of sales rates.

It comes as house prices are reportedly on the rise with Halifax saying there was a 1.1% increase in the average house price in April.

"The present market backdrop, in terms of consumer demand and mortgage supply, is the most positive we have seen for five years and for full year [20]13 the group expects to deliver a significant year on year improvement in operating profit," the company said in the statement covering the 18 week period from January 1 to May 5.

The firm reported a 9.7% increase in net private reservations to 0.68 (2012: 0.62) per week per active site and also said private forward sales, excluding joint ventures, were up 28.5% as at May 5, 2013 to  £1,013.5mln, compared to £788.6mln on May 6 last year.

"Overall, the group is making good progress towards achieving its key stated targets of zero net debt as at 30 June 2015, a dividend cover of around three times for the financial year ending 30 June 2016 and a substantial improvement in return on capital employed in the medium term."

Quick facts: Barratt Developments

Price: 502.8 GBX

LSE:BDEV
Market: LSE
Market Cap: £5.12 billion
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