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Housebuilder's £390m profit aim after strong sales
11:30am Thursday 10th July 2014 in Business
COMPANY FOUNDER: Sir Lawrie Barratt, founder of Barratt Developments, previously pictured with the company's promotional helicopter
THE UK's largest housebuilder expects to double profits to £390m as increasing buyers’ confidence galvanises the market.
Barratt Developments says it sold 14,838 homes in the year to June 30, with forward sales 44 per cent higher than the same time last year at £1.2m.
The firm, founded by North-East property tycoon Sir Lawrie Barratt, revealed average selling prices lifted 13 per cent to £220,000 from £194,800, helped by larger homes and price inflation.
Bosses say the results mean the company in course to deliver full-year pre-tax profits of £390m in September.
They also hailed its decision to buy increased land, which saw plots increase 16 per cent to 21,478 in the period.
Mark Clare, Barratt Developments’ group chief executive, said: “The market remains positive with strong demand for new homes across the country.
“The land we have bought in the last five years together with our disciplined operating model is delivering very strong performance.
“Our focused approach to land buying will enable us to maintain a land supply of about four-and-a-half years and support a significant increase in profitability.”
A report added the company expects to open another 180 sites in the next year, targeting 16,000 sales in the 2016 financial year.
Earlier this year, Barratt revealed plans to create about 3,000 jobs after the extension of the Help to Buy scheme to 2020, and lift its number of working sites from 380 to 450.
It also wants to recruit about 1,100 apprentices and trainees, including a number from the North-East, to capitalise on its sales high.
Mr Clare added: “Underpinning our strong performance is an improved market and a business model delivering homes that people want to buy, in places they want to live.
"Our approach means we have been able to increase the number of new homes we are building, while driving up profits.
"That's why we are expanding our recruitment drive for 1,100 apprentices, graduates and trainees, which demonstrates our commitment to further growth.”
Last year, Barratt told The Northern Echo people had lined the streets to queue up and get the first properties on its 295-house development in Nunthorpe, near Middlesbrough.