Barratt remains cautious as it slashes £1.4bn debt in half

Published on Tuesday 17 November 2009 20:52

HOUSEBUILDER Barratt Developments yesterday confirmed it will have slashed its £1.4 billion debt pile in half by the end of 2009 as it reported an upturn in reservations by a third on last year.

In a statement on trading in the third quarter to 8 November, Barratt, Britain's second-largest housebuilder by market value, said net reservations per site had risen by 34 per cent on the same period in 2008, offering further evidence that the UK housing market has stabilised.

But the group said it would remain "cautious" on recording reservations, adding there continued to be limited availability of mortgage finance.

Barratt said that by the end of the year debt will have fallen from 1.4bn to 700 million, following its successful rights issue in September. The group said that it raised gross proceeds of 720.5m, although the exceptional costs of restructuring its bank facilities will cost it 125m in the first half of 2010.

Rival Persimmon also offered up hope for the housing market on Monday, saying that trading had improved, lifted by higher sales and prices.

Barratt shares closed down 3 per cent at 141.7p.