Barratt building up profits

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Housebuilder Barratt Developments has predicted that its half-year profits will more than double following a significant reduction in its debt pile.

The UK’s largest building firm said average selling prices had risen by 2.1 per cent to about £185,000 as a state-backed scheme stimulated growth in the market.

Barratt chief executive Mark Clare said interest in the UK government’s NewBuy scheme, which provides guarantees on 95 per cent mortgages, had increased over the past weeks and now made up 9 per cent of private reservations, excluding Scotland and Wales.

The group’s results, due at the end of next month, are expected to show pre-tax profits of about £45 million for the six months to 31 December, up from £21.6m a year earlier, although revenues are predicted to be down slightly at £950m.

Net debt has fallen to about £332m from £542m a year ago.