Barratt Developments PLC has released a trading update for the year ended 30 June 2024, showcasing a robust operational performance despite economic and political uncertainties. The company's net private reservations per active outlet increased to 0.58, with total home completions at 14,004, slightly ahead of previous expectations. The firm's adjusted profit before tax is anticipated to be slightly ahead of previous expectations, and it has recognized legacy property charges of approximately £192m. Barratt Developments PLC maintains a strong balance sheet position with year-end net cash of approximately £865m, positioning the company well as land market activity increases.
The company anticipates total home completions in a range of 13,000 to 13,500 in FY25, including approximately 600 completions from joint ventures. Barratt Developments PLC was awarded 89 Pride in the Job Awards for outstanding site management in the 2024 NHBC Awards, more than any other housebuilder for the 20th consecutive year. The proposed combination with Redrow was approved by both sets of shareholders, and the company is awaiting the Competition and Markets Authority's (CMA) approval.
The net private reservation rate for FY24 increased by 5.5%, including a contribution from reservations into the private rental sector and additional reservations of private units to Registered Providers of social housing. The company saw stabilizing first-time buyer activity and resilient demand among existing homeowners. Barratt Developments PLC continues to drive revenue across all tenures by increasing sales into the private rental and affordable housing sectors.
The company operated from an average of 346 active sales outlets in FY24, and it forecasts a temporary reduction in average sales outlets by around 9% in FY25, with significant net sales outlet growth expected in Q4 FY25 and FY26. Total home completions, including joint ventures, reduced by 18.6% in the year to 14,004, with reservation activity improving on a sustained basis throughout the second quarter.
In conclusion, Barratt Developments PLC has demonstrated resilience and strong operational performance in the face of challenging market conditions, positioning the company well for the future.