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Barratt says profits up 9 percent in 2018

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Barratt says profits up 9 percent in 2018

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(Reuters) - Britain's biggest housebuilder Barratt Developments Plc <BDEV.L> expects full-year pretax profit to have risen 9 percent, boosted by a 5 percent average rise in prices and a continuing creep higher in its number of homes sold.

While there are signs of a slowdown at the top of the UK housing market, Barratt and other new-home builders have been propped up by low interest rates and government schemes designed to help younger people get on to the housing ladder.

The company said market conditions overall continued to be supportive, and said it had seen a better than expected performance in a flagging central London market, where it sold 190 homes at an average price of just under 1.2 million pounds.

Total completions rose 1.1 percent to 17,579 for the year ended June 30, while the average selling price rose to 289,000 pounds ($383,069) from 275,200 pounds a year earlier.

In a push to boost profit margins, Barratt reviewed its housing ranges in 2016, changing designs to simplify construction and reduce build costs.

The company said operating margins rose 50 basis points to about 17.7 percent, helped by those initiatives.

Barratt said total forward sales had risen 1.5 percent year-on-year to 2.18 billion pounds as of June 30. The company said it will provide 2019 guidance and a medium term outlook with its full year results on Sept. 5.

(Reporting by Arathy S Nair in Bengaluru; Editing by Amrutha Gayathri)

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