BARRATT DEVELOPMENTS

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Barratt Developments : UK builder Barratt scraps special dividend, sees improvement in bookings

09/02/2020 | 02:54am

Britain's biggest housebuilder, Barratt Developments, scrapped a special dividend payout for 2021 on Wednesday as it reported a near 30% fall in full-year housing completions and revenue, but pointed to an improvement in forward sales.

Britain's housing market has picked up pace in recent months after coming to a virtual standstill in late March and April, as tax breaks for home purchases and a shift towards suburban living caused by the pandemic spur home sales.

The FTSE-100 company, which builds homes in England, Scotland and Wales, said it entered the new financial year with "cautious optimism".

Its total forward sales as on Aug. 23 stood at 15,660 homes with a value of 3.71 billion pounds, compared with 13,064 homes last year.

The company said pretax profit fell 45.9% to 491.8 million pounds ($657.73 million) in the full year ended June 30. It incurred costs of 74.3 million pounds related to the impact of the COVID-19 pandemic on its business.

Barratt praised the government's stamp duty holiday scheme as a boost to the industry, but said that it saw signs that many buyers were struggling with tighter lending conditions as banks worry about loan risks amidst one of the most severe global recessions.

"The restriction and removal of Help to Buy will exacerbate this. It is important that lenders and the Government consider what further options are available to help potential first time buyers who want to purchase their own home," Barratt said.

(Reporting by Samantha Machado in Bengaluru; Editing by Shailesh Kuber and Saumyadeb Chakrabarty)

© Reuters 2021
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