Insider Media Limited

Housebuilder Barratt Developments says it has made “a significant improvement” in both average selling prices and operating margins of its projects, despite trading having been affected by “difficult conditions”. The Coalville-based developer revealed that group revenue had remained flat for the six months to 31 December 2010 at £875m. Plans to open a further 110 sites were also confirmed in the company’s trading statement to the London Stock Exchange this morning.

During the six-month period, Barratt completed 4,832 units, and increased each average selling price by 6 per cent against the previous year’s equivalent period to £176,000.

The number of units completed had dropped slightly since the first half of the year, down from 5,053.

Barratt said that it had experienced a “significant improvement” in operating profit with operating margin increasing to about 5 per cent in the period, up from 2.4 per cent in the prior year’s comparable period.

Forward sales at 31 December 2010 were in line with the prior year at £645.7m.

However, the company said that despite planning more than 100 new sites to open in the next six months, “any volume growth for the year will be limited”.

Mark Clare, group chief executive, said:"The group has delivered a significant improvement in both average selling prices and operating margin even though sales volumes have been affected by difficult trading conditions. We are on course to make further progress in the second half as we open new higher margin sites and continue to be value and quality focused."

In the interim statement, the company also said that during the six month period, terms were agreed on £318m of land purchases, equating to a total of 57 sites and 6,078 plots. Barratt confirmed that a further 110 sites would open throughout the next six month period.

The group also said that it had “commenced discussions” regarding the re-financing of its banking facilities and expect this to be completed in the coming months.