Barratt Developments – Back To Business As Usual

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Barratt Developments – Back To Business As Usual

Barratt Developments PLC (LON:BDEV)’s full year (ended 30 June) revenue was £4.8bn. That’s up 40.7% on 2020 and 1.0% on 2019, reflecting increased completions and higher average prices compared to both 2020 and 2019.

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Operating profits came in at £811.1m, up 64.4% year-on-year but still 10.0% below 2019. The decline on 2019 reflects lower gross margins due to legacy property costs and repayment of coronavirus grants from the government. Without which margins would have improved.

The board announced a final dividend of 21.9p per share, up from 19.5p in 2019 and nothing in 2020.

Barratt Developments shares fell 2.5% in early trading.

Barratt Developments' FY Results

Nicholas Hyett, Equity Analyst at Hargreaves Lansdown:

“All the signs in Barratt’s results are that the housing market remains robust. Average selling prices are climbing again, more than offsetting a 4-5% increase in build costs, while forward sales are some 20.4% ahead of pre-pandemic levels. With coronavirus related costs fading into the background underlying profits are growing once again.

Despite the progress the market seems disappointed with the results, and we suspect that’s down to limited detail about additional shareholder returns. The group exited the last financial year with over £1.3bn in net cash. A good portion of that is earmarked for helping the group reach 20,000 completions a year, but with land purchases already approaching that level that still leaves some surplus.

Still, with a dividend yield north of 5%, profits back on track and end markets that look robust despite the recent housing boom, Barratt’s weathered the storm well, coming out of the pandemic with solid foundations on which to build.”


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Jacob Wolinsky is the founder of ValueWalk.com, a popular value investing and hedge fund focused investment website. Jacob worked as an equity analyst first at a micro-cap focused private equity firm, followed by a stint at a smid cap focused research shop. Jacob lives with his wife and four kids in Passaic NJ. - Email: jacob(at)valuewalk.com - Twitter username: JacobWolinsky - Full Disclosure: I do not purchase any equities anymore to avoid even the appearance of a conflict of interest and because at times I may receive grey areas of insider information. I have a few existing holdings from years ago, but I have sold off most of the equities and now only purchase mutual funds and some ETFs. I also own a few grams of Gold and Silver
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