Barratt to Hit Earnings Target Far Earlier Than PlannedPatrick Gower
Barratt Developments Plc, the second-biggest U.K. homebuilder by market value, said it will reach return-on-capital-employed goals “significantly” earlier than planned after advance sales jumped.
Barratt is confident it will achieve the 18 percent return target set for fiscal 2016 well ahead of schedule, the Leicestershire, England-based company said in a statement today. Private forward sales, or homes paid for and not yet built, rose to 1.9 billion pounds ($3.2 billion) as of May 4 from 1.3 billion pounds a year earlier, Barratt said.
“We’ve got far more consumers that have held off for five years to make that decision about buying or moving,” Chief Executive Officer Mark Clare said by phone. ’’As the economy continues to improve, more and more people are becoming active in the housing market.’’
Britain’s property market has been bolstered by a strengthening economy, record-low borrowing costs and the government’s Help-to-Buy program. Home prices climbed 10.9 percent during the year through April, the biggest annual gain since June 2007, Nationwide Building Society said on May 1.
Barratt rose 1.5 percent to 381.80 pence as of 8:27 a.m. in London, giving the company a market value of about 3.8 billion pounds. Persimmon Plc is the U.K.’s biggest homebuilder.