14th Oct 2020 09:08
(Alliance News) - Barratt Developments PLC on Wednesday said it is seeing continuing strong customer demand for new homes across the UK and says it is well positioned to weather any challenges.
The Leicestershire, England-based housebuilder said its sales rate from July 1 to October 11 was 0.87 net private reservations per active outlet per average week, up 21% year-on-year from 0.72.
The company operated from an average of 340 active outlets, down from 374 a year prior, due to site delays caused by Covid-19.
Barratt has launched 33 new developments, including joint ventures, helping completion volume recovery which is expected.
Barratt is now focused on rebuilding its completion volumes to its medium-term target and capacity of 20,000 homes.
"We have acquired land in recent years at a minimum 23% gross margin, and through our continued focus on operating efficiencies and the rebuilding of completion volumes, we continue to target a minimum 25% return on capital employed in the medium term," the company said.
Barratt continues to expect to grow wholly owned completions to between 14,500 and 15,000 homes in the 2021 financial year, as well as deliver around joint venture 650 completions, it said.
"Whilst there continues to be economic and political uncertainty, the group is in a strong position. We have a substantial net cash balance, a well-capitalised balance sheet, a healthy forward sales position, a continued focus on delivery of operational improvements across our business and an ongoing commitment to deliver high quality homes across the country."
The company believes it is in a strong financial position and it is set to weather any challenges with "resilience and flexibility".
Barratt shares were up 0.9% at 548.60 pence each in London on Wednesday morning.
By Greg Roxburgh; [email protected]
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