A fall in operating profit margins and a writedown of almost half a billion pounds worth of assets caused Barratt Developments to plunge to a £592m pre-tax loss in the final six months of last year.
The figure compared with a £195m profit for the house builder in the same period the previous year.
Operating profit margins also fell as Barratt aggressively discounted property to raise cash. Barratt made a 1.3% margin on sales before exceptional items during the period, compared with nearly 17 per cent in the same period last year. The average selling price dropped 9.7% to £160,700.
However, the focus on cash generation meant that the company wiped £228m off its net debt, bringing the total in yesterday’s interim results to £1.4bn. Cash flow from operations rose to a positive £250m, compared with a negative £355m in the same period last year.
Financial Times, The |Times, Daily Telegraph