Coronavirus Update

Barrat Developments PLC Half Year Results 2020

This content has been sourced from: https://www.investegate.co.uk/barratt-developments...

 Strong first half delivery, well positioned for the second half

£m unless otherwise stated 1 , 2

Half year ended 31 December 2020

Half year ended 31 December 2019

Change

Total completions (homes)3

9,077

8,314

9.2%

Revenue

2,494.7

2,266.2

10.1%

Profit from operations

422.9

421.7

0.3%

Adjusted operating margin4

20.3%

19.4%

90 bps

Operating margin4

17.0%

18.6%

(160 bps)

Profit before tax

430.2

423.0

1.7%

Basic earnings per share (pence)

34.3

33.8

1.5%

Interim dividend per share (pence)

7.5

-

 

ROCE4

17.8%

29.3%

(1,150 bps)

Net cash4

1,106.7

433.8

155.1%

 

Highlights  

·

Record first half year home completions with 9,077 total completions3, up 9.2%

·

Recovery in adjusted operating margin to 20.3% (2019: 19.4%, H2 FY20: 5.9%) mainly driven by growth in completions, delivering adjusted profit before tax of £507.2m (2019: £440.8m). After adjusted items of £77.0m (2019: £17.8m), profit before tax was £430.2m (2019: £423.0m)

·

Continued strong cash generation with period end net cash of £1,106.7m (2019: £433.8m) and land creditors reduced to £601.1m (2019: £830.8m) (21.2%; 2019: 27.4% of land bank) further strengthening our balance sheet

·

Continued progress in maintaining our position as the leading national sustainable housebuilder; the only housebuilder to deliver improved annual CDP scores across all three categories this year (Forest, Water and Climate)

·

Launched The Barratt Charitable Foundation to further support the communities in which we operate

 

Dividend resumed

·

Following careful consideration the Board has decided to resume dividend payments with an interim dividend of 7.5 pence per share and continues to target a full year dividend cover of 2.5 times

 

Current trading

·

Net private reservations per active outlet per average week for January were 0.77, 7.2% below the equivalent period in 2020 (0.83) but 4.1% ahead of the equivalent reservation rate in 2019 of 0.74

·

Strong total forward sales3 as at 31 January 2021 of 14,289 homes (3 February 2020: 13,043 homes) at a value of £3,425.8m (3 February 2020: £3,027.1m) with 11,588 homes secured for completion beyond 31 March 2021

·

Outlook for the full year remains in line with the Board's expectations with wholly owned completions expected to be between 15,250 and 15,750 homes with around 650 further joint venture home completions in FY21

 

 

Commenting on the results David Thomas, Chief Executive of Barratt Developments PLC, said:

"Our first priority remains keeping our colleagues and customers safe. Our customers are at the heart of everything we do and I would like to say a huge thank you to all of our employees and sub-contractors who have continued to deliver great quality homes and excellent customer service throughout these challenging times. W e have achieved a fantastic first half performance, with a strong rebound in completion volumes and good progress towards our medium term targets.

 

We have also made a solid start to the second half and are now over 95% forward sold for our financial year. Whilst we are mindful of the continued economic uncertainties, the housing market fundamentals remain attractive and our outlook for the full year remains in line with expectations. We will continue to lead the industry in quality and service as we deliver the high quality sustainable homes and developments the country needs, creating jobs and supporting the economic recovery across England, Scotland and Wales".