Insider Media Limited

Barratt Developments, the Bardon Hill-based housebuilder, said this morning that the market remains “fragile” after it reported losses of £4.6m for the six months to 31 December 2010. The result compares with the huge loss of £178.4m which was suffered over the same period in 2009.

Revenues over the period were steady at £877.6m – a slight rise on £872.4m in 2009.

Completions for the period stood at 4,832 - down slightly on the 5,053 in 2009. These included 36 joint venture completions.

Average selling prices, excluding joint venture completions, increased by 5.7 per cent against the previous year to £175,800, with private average selling prices increasing by 10.8 per cent to £191,900, Barratt said.

Mark Clare, group chief executive of Barratt Developments, said: "By focusing on price not volume and improving the underlying efficiency of our business, we have achieved a significant improvement in our operating margin despite a challenging autumn selling season.

"2011 has started well with encouraging sales rates and stable underlying pricing. We expect to see further operating margin growth in our second half as we continue to optimise prices, reduce costs and open new higher margin sites from recently acquired land.

"However, the market remains fragile and longer term recovery continues to depend on greater availability of mortgage finance."

In the first six months of the financial year Barratt said it was working on an average of 352 active sites, down 4.3 per cent on the same period last year. During the half year, the company started work on 79 sites and as at 31 December 2010 it was operating from 366 active sites, up slightly on the 364 in 2009.

Barratt said it expects to start work on around another 100 sites over the next six months.

In a statement to the London Stock Exchange, the company said it is looking to improve profitability and strengthen the financial position of the company whilst investing in its existing land bank as well as new sites.

Clare added: "With our continued focus on tight cost control and drive for improved operating efficiency, combined with an increase in completions from new higher margin land going forward, we expect to deliver further improvement in the Group's performance."