arratt developments has forecast annual profits of £1.1bn and said it has completed a larger share of its more affordable suburban homes London in the last fiscal year, which helped to increase average selling prices.
The FTSE 100 house builder said the mean price of its affordable properties reached £159,000 from £146,500 last year, “due to a greater number of completions” in the suburbs of London. The private average selling price was £341.00, an increase of £325,500.
It said adjusted annual profit was expected to be around £1.1 billion, “slightly above current market consensus expectations”, for the fiscal year to June 30.
Barratt signed the government pledge for building safety and an initiative to resolve potential safety issues with buildings identified after the Grenfell Tower Fire disaster. It reported costs of £412 million for “old cost of ownership related to building safety remediation activities” and it said further repairs related to the property would be carried out over the next three to five years. Barratt said safety considerations “would be paramount when prioritizing and planning works.”
The number of deliveries returned to pre-Covid-19 levels, reaching 17,908, including joint ventures, from 17,243 in the previous fiscal year. The completion of a London block of flats with more than 220 homes was delayed until 2023, “due to resource-related delays in the construction management process.”
David Thomas, CEO of Barratt, said: “We are delighted that completions have now returned to pre-pandemic levels and I am grateful for the hard work and dedication of our teams and partners over the past two years to bring this important milestone to reach.”
He acknowledged that “macroeconomic uncertainties lie ahead,” but added that “the housing market remains robust, our forward order book is strong and we have the resilience and flexibility to respond to changes in the business environment.”
Barratt introduced an accelerated 5% pay increase from 1 April 2022 and a further temporary salary supplement of £1,000 for all senior management employees, phased over the next six months until 31 December 2022 to help retain staff in a tight labor market and a time of high inflation.