Financial Highlights

Interim Results for the half year ended 31 December 2007

Highlights:

First half completions were 9,056 (2006: 7,206), up by 25.7%. As a result, Group turnover, rose by 38.4% to £1,652.8m (2006: £1,194.4m). On a like-for-like* basis, completions were down 14.8%.
The average selling price was £178,000 (2006: £165,000), an increase of 7.9% primarily reflecting the change in mix arising from the acquisition of Wilson Bowden. On a like-for-like* basis, although private and social average selling prices were up 0.6% and 5.3% respectively, the increased proportion of social completions led to a small overall decline of 0.8%.
Housebuild operating margin** increased to 16.8% (2006: 16.5% (restated)) but was down 0.5% on a like-for-like* basis.
Profit before tax and restructuring costs increased by 14.3% to £201.8m from £176.6m (restated). Profit before tax increased by 10.2% to £194.6m from £176.6m (restated).
Adjusted basic earnings per share*** were 40.2p (2006: 51.5p (restated)). Basic earnings per share were 38.8p (2006: 51.5p (restated)).
Given the performance of the business in the first half and our view of the current year we are increasing the interim dividend to 12.23p (2006: 11.38p), up by 7.5%. The interim dividend is 3.2 times covered.
Land stocks strengthened to 113,500 plots (including 24,100 agreed subject to contract) – 5.3 years supply at last year’s like-for-like* volumes of 21,569.
Net borrowings were £1,738.5m (2006: £226.7m), including £1,245.9m of debt to fund the acquisition of Wilson Bowden.
Forward sales at 31 December 2007 were £1,263m (2006: £1,030m) 22.6% up on last year’s statutory numbers and down only 5.5% on a like-for-like* basis. As at 17 February 2008 forward sales had increased to £1,615m, around 7%* below last year, which, taken with completions to date, means that we have secured 79.0% of our full year requirement.

*’Like-for-like’ basis assumes that the acquisition of Wilson Bowden was completed upon the first day of the comparative financial period. Wilson Bowden achieved 3,417 completions, turnover of £806.2m, operating profit of £152.1m and a profit before tax of £138.3m in the six months ended 31 December 2006.
**Before restructuring costs of £7.2m (2006: £nil).
***Before restructuring costs of £7.2m (2006: £nil), offset by tax of £2.2m (2006: £nil).
The comparative period has been restated as explained in note 3 to the interim report.

Mark Clare, Group Chief Executive of Barratt Developments commented:

‘Trading conditions over the last six months have been difficult and the business has had to adjust to this new environment. Against that backdrop, we have traded satisfactorily whilst successfully completing the integration of Wilson Bowden. We have focused on improving every aspect of the business and this has underpinned a robust margin. We are continuing to reduce costs, whilst improving sales effectiveness to ensure that prices and volumes are maximised.

‘The new calendar year has started well. We have increased outlets, and have a strong forward order book. Visitor and reservation levels continue to improve and we remain optimistic that this will continue through the balance of the spring selling season.’