RESULTS PRESENTATION Year ended 30 June 2020 2 September 2020 - Saviours Place, Warrington - Barratt ...
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RESULTS PRESENTATION
Year ended 30 June 2020
2 September 2020
Saviours Place, Warrington
1
David Thomas
Chief Executive Officer
St Rumbold’s Fields, Buckingham
2
KEY HIGHLIGHTS
• Before COVID-19 strong progress on volume growth and margin improvement
• All operational sites reopened by 30 June 2020
• Health and safety remains our first priority
• Strong balance sheet - £308m year end net cash and significant undrawn facilities
• Leadership in quality and customer service
3
OPERATIONAL TARGETS
FY20 Areas of focus for FY21 Medium term targets
Driving site based construction activity
Maximising sales for customers who will not
Wholly owned 12,034 Disciplined growth in wholly owned
qualify under the new Help to Buy scheme
home completions homes home completions
Wholly owned home completion growth to
14,500 - 15,000 in FY21
Rebuilding site based construction activity to Land acquisition at a minimum 23%
Gross margin 18.0% improve fixed cost recovery gross margin and optimising
Controlling material and labour cost inflation performance
Tight control of working capital with build
release aligned with home completion cash Minimum of 25% delivered through
ROCE 15.6% generation improving margin and return to
Focus on cash with selective land spend beyond operating framework
land creditor settlements
4
Steven Boyes
Chief Operating Officer
Cane Hill Park, Coulsdon
5
SALES PERFORMANCE
Net private reservations per active outlet per average week (1)
• Good sales rate at 0.60 given challenging
backdrop
Pre lockdown (2)
Lockdown (3)
Post lockdown (4)
Full year
• Sales rate was 7.4% ahead prior to
lockdown FY20 0.73 (0.10) 0.63 0.60
• Strong recovery with positive trend
FY19 (5) 0.68 0.82 0.69 0.70
Variance % 7.4% n/m (8.7%) (14.3%)
(1) An active outlet is defined as an outlet with at least one plot for sale. Our definition remains consistent with previous reporting periods, unaffected by the closure of our sales centres across the Group during the lockdown period
(2) Pre lockdown period of 38 weeks from 01/07/19 - 22/03/20
(3) Lockdown period of 8 weeks from 23/03/20 - 17/05/20
(4) Post lockdown period of 6 weeks from 18/05/20 - 30/06/20
(5) FY19 is equivalent period 6
COMPLETIONS
Completions
• COVID-19 halted the significant progress made in H1
FY20:
FY20 FY19 Change
- H1 wholly owned completions were ahead 8.1%
Private 9,568 13,533 (29.3%)
- H2 wholly owned completions declined by 58.5%
Affordable 2,466 3,578 (31.1%)
Wholly owned 12,034 17,111 (29.7%)
JV 570 745 (23.5%)
Total (inc JVs) 12,604 17,856 (29.4%)
7
COMPLETIONS ANALYSIS – BUYER TYPE
4% 5% Investor
• Similar profile year on year 11% 11% Part-exchange
• Help to Buy is an important customer proposition
20% 21% Affordable
• Help to Buy is tapering from 1 April 2021:
- First time buyers only
Other private
30%
- Regional price caps
27%
• Existing homeowners:
Help to Buy
- Alternative mortgage products 19% 21% eligible post
taper
- Part-exchange option
Help to Buy
16% 15% ineligible post
taper
FY20 FY19
8
PRICING TRENDS REMAIN POSITIVE
• Regional pricing reflects change in geographical mix Private completions average selling price (£’000)
• London driven by trade through of central London FY20 FY19 Change
and outer London site mix
• Modest underlying house price inflation in FY20 Regional 303.6 297.2 2.2%
London 754.8 628.5 20.1%
Group 310.6 312.0 (0.4%)
JV 585.0 537.9 8.8%
9
OPERATIONAL ACTIVITY
• Health and safety remains our key concern, all operations
comply with our enhanced COVID-19 working practices
• Site activity recommenced in waves from 11 May 2020 in
England and Wales and 1 June 2020 in Scotland
• All operational sites were restarted with our employees (1)
returned to work by 30 June 2020
(1) Except those shielding
10REBUILDING OUR CONSTRUCTION ACTIVITY
Management and trades headcount on site
• Return to site managed within COVID-19 16,500
protocols and site specific considerations
15,000
• Initial focus managing construction to 13,500
meet forward sale commitments
12,000
• Headcount on site has expanded:
10,500
- Phased site reopening 9,000
- Site headcount optimisation within 7,500
social distancing requirements
6,000
- Construction activity across all build 4,500
stages
3,000
1,500
-
14 May
21 May
28 May
9 Jul
4 Jun
2 Jul
7 May
13 Aug
20 Aug
11 Jun
18 Jun
25 Jun
16 Jul
23 Jul
30 Jul
6 Aug
2020
11OPTIMISING OUR CONSTRUCTION ACTIVITY
Weekly build equivalent unit production (homes)
• Focused on optimising site construction activity 400
to levels prior to lockdown through: 361 361
347
350
- Extended site operating hours
300
- Improved build scheduling to reduce unit
down time 250
- Continued broadening of build activity 200
including new site infrastructure
construction 150
- Increasing proportion of standard house 100
types adding simplicity, repeatability and
50
efficiency
- Optimisation of build mix with Oregon 0
FY19 FY20 FY20 Week 1 Week 2 Week 3 Week 4 Week 5 Week 6 Week 7 Week 8
timber frames playing an important role in Weeks 1-38 FY21
accelerating build time Weekly equivalent unit production (homes) FY21 target weekly equivalent unit production (homes)
12DRIVING OPERATING MARGIN – NEW PRODUCT ROLL OUT
Proportion of regional completions using new product ranges (%)
70%
• Continual process of product range review and
refinement for further build efficiencies 60%
60%
• Regional completion momentum from new product 50%
ranges maintained +19%
40% 36%
• 60% of all regional completions in FY20 (FY19: 36%) (1)
30%
• Suitable for Modern Methods of Construction
20%
9%
10%
0%
FY18 FY19 FY20
42% 72% 79%
% of active outlets with new product range (1)(2)
(1) Including JVs in which the Group has an interest
(2) As at 30 June
13LEADING CONSTRUCTION – MODERN METHODS OF CONSTRUCTION
• Use of Modern Methods of Construction continues to
grow
• 21% of completions in FY20 vs 20% in FY19
• On track to deliver our target of 25% of completions
by 2025
• Oregon successfully integrated and key to increasing
use of timber frame
Oregon timber frame installation at East Ardsley, West Yorkshire
14LAND BANK
• Land bank remains strong
Land bank plots 30 June 2020 30 June 2019
• Land approvals totalled 9,441 plots across 51 sites
Owned 68,393 66,423
• Continue to operate a shorter land bank model
Controlled 11,931 13,599
• Medium term land bank targets remain:
- c. 3.5 years owned and c. 1.0 year controlled land in Total 80,324 80,022
each division
Land bank years (exc JVs) 6.7 4.7
• Selective and disciplined land buying recommenced
JV – Owned and controlled 5,400 5,207
Total including JV 85,724 85,229
15LAND MARKET
Savills UK Greenfield Development Land Index versus
• Land prices have remained broadly stable English Planning Consents(1)
HOLDING PICTURE – CB 450
Savills UK Greenfield Development Land Index
120
England moving annual planning consents ('000s)
• High quality land opportunities remain plentiful SPEAKING TO PHIL BARNES
400
across the country 100
350
(100 = 2007 peak)
• Planning consents remain ahead of development 80 300
suggesting continued attractive supply: demand
dynamics 250
60
200
• Will evolve post COVID-19
40 150
100
20
50
0 0
2011
2012
2016
2010
2013
2015
2018
2019
2014
2017
2007
2008
2009
2020
Savills UK Greenfield Development Land Price Index
England - Planning consents ('000's)
(1) Data to 31 March 2020
16MANAGING THE COST ENVIRONMENT
Materials Labour
• Limited inflation likely • Limited signs of cost
given excess capacity and pressures
lower energy costs • Increased use of off-site
• 95% of pricing fixed to manufacturing – Oregon
December 2020 timber frame optimisation
• 62% of pricing fixed to • 219 new apprentices,
June 2021 trainees and graduates in
FY20
Build cost inflation FY21: c.1-2%
17SUMMARY
• Lower completions due to lockdown
• Sales rates have shown a strong recovery
• Construction activity now close to pre lockdown levels
• Delivering industry-leading quality and customer
service
• Continued focus on Health & Safety
Ridgeway Views, London
Octavia Gardens, Chapel-en-le-Frith
18Jessica White
Chief Financial Officer
Fairfield Croft, 19
YorkPERFORMANCE
£m (unless otherwise stated) FY20 FY19 Change
Revenue 3,419.2 4,763.1 (28.2%)
Gross profit 614.3 1,084.2 (43.3%)
Gross margin % 18.0 22.8 (480 bps)
Operating profit 493.4 901.1 (45.2%)
Operating margin % 14.4 18.9 (450 bps)
PBT 491.8 909.8 (45.9%)
Earnings per share pence 39.4 73.2 (46.2%)
Net cash 308.2 765.7 (59.7%)
ROCE % 15.6 29.7 (1,410 bps)
20REVENUE SUMMARY
FY20 FY19 Change
Home completions (units)
Private 9,568 13,533 (29.3%)
Affordable 2,466 3,578 (31.1%)
Total home completions 12,034 17,111 (29.7%)
% Affordable 20% 21% (100 bps)
JV 570 745 (23.5%)
Total home completions (inc JVs) 12,604 17,856 (29.4%)
ASP (£’000)
Private 310.6 312.0 (0.4%)
Affordable 163.0 132.2 23.3%
Total 280.3 274.4 2.2%
JV 472.9 487.8 (3.1%)
21COVID-19 IMPACT AND ADJUSTED ITEMS
£m (unless otherwise stated) FY21 FY20 Margin FY19 Margin
Gross profit 614.3 18.0% 1,084.2 22.8%
Adjusted items:
Costs / (credit) associated with legacy properties costs charged in H1 17.8 (3.7)
Costs associated with legacy properties costs charged in H2 c. 48.0 22.1 6.9
(Income) from Government CJRS grant 22.8(1) (22.8) -
Adjusted gross profit 631.4 18.5% 1,087.4 22.8%
COVID-19 safety and non-productive site costs – Non-recurring costs 45.2 -
Inventory provision charge / (reversal) – Non-recurring costs 8.2 (14.8)
684.8 20.0% 1,072.6 22.5%
COVID-19 site extensions – Recurring costs 29.1 -
(1) £26.0m of Government CJRS grant income received in total and repaid in FY21. £3.2m allocated against administration costs
22OPERATING MARGIN BRIDGE
Non-recurring items Trading items Non-recurring items
40 bps 220 bps 190 bps
19.0%
40 bps Increase
Decrease
18.0%
190 bps
17.0%
50 bps 50 bps
90 bps 20 bps
16.0% 18.9%
18.5% 120 bps
60 bps 130 bps
15.0%
120 bps
14.0% 14.8% 80 bps
14.4%
13.0%
FY19 Remove FY19 Volume Transition Net Site Mix & Admin Inventory Non FY20 Costs on CJRS Grant FY20
non- subtotal impact to new sites inflation extension other expenses provision productive adjusted legacy income
recurring charge site properties in respect of
items overhead COVID-19
impact 23OPERATING FRAMEWORK
New operating framework Position at 30 June 2020 and 2019
2020: 5.7 years owned and 1.0 year controlled
Land bank c. 3.5 years owned / c. 1.0 year controlled
(2019: 3.9 years owned and 0.8 years controlled)
Land creditors (1) Reduce usage to 15 - 25% of the land bank over medium term Reduced to 25.4% (2019: 31.3%)
Modest average net cash over the financial year FY20 average net cash of £348.3m (2019: £298.3m)
Net cash
Year end net cash 2020: £308.2m (2019: £765.7m)
Total indebtedness (1)
2020: £483.7m total indebtedness
(net cash and land Minimal year end total indebtedness in the medium term
(2019: £195.0m total indebtedness)
creditors)
£700m Revolving Credit Facility extended to November 2024
Treasury Appropriate financing facilities
£200m Private Placement Notes maturing August 2027
2.5x ordinary dividend cover
Dividend policy (1) FY20 no dividend proposed (2019: 46.4p per share)
(at the appropriate time)
(1) Changed with FY20 announcement
24BALANCE SHEET
£m 30 June 2020 30 June 2019
Goodwill and intangible assets 907.0 908.2
Investment in joint ventures and associates 152.1 189.0
Gross land bank 3,112.3 3,071.6
Land creditors (791.9) (960.7)
Net land bank 2,320.4 2,110.9
Land creditor % 25.4% 31.3%
WIP 1,852.4 1,632.8
Net cash 308.2 765.7
Trade payables (186.8) (353.6)
Other working capital (511.3) (329.5)
Other net assets / liabilities (1.7) (54.5)
Net assets 4,840.3 4,869.0
25CASH FLOW
Inflow
Outflow
500
400
(195.5) Includes land
300 spend c.£780m
(34.8)
493.4
200 (162.9)
100 (48.9)
£m
0 (168.8) (52.3)
(100) 65.2
(200)
(373.2) (457.5)
(300)
(400) (32.0)
(500)
Profit from Net cash Other non- WIP / PX Land Land creditors JV investment Operating Dividends Other Net
operations interest & tax cash and cash outflow investing cash
working & financing outflow
capital
26GUIDANCE FOR FY21
14,500 – 15,000 wholly owned home completions
Completions c. 20% affordable
c. 650 JV
Total administrative expenses c. £195m
CJRS grant refund £26m
Adjusted items
Legacy property costs c.£48m
c. £30m
Interest cost
(c. £10m cash, c. £20m non-cash)
Land cash spend c. £850m
Land creditors 15 – 25% owned land bank
Average net cash c. £300m
Year end net cash c. £550m
27FINANCIAL SUMMARY
• Resilient financial performance
• Balance sheet remains strong with significant
financing facilities
• Land creditor reduction target achieved
• Disciplined approach to cash management
• Clear operating framework
• Well positioned for the future
Cricket Field Grove, Crowthorne
Fairfields, Milton Keynes
28David Thomas
Chief Executive
Winnington Village, Northwich
29INVESTMENT PROPOSITION
Strong Highly
Shorter
balance sheet experienced Quality and Nationally Leading
owned land
and cash build and service diversified sustainability
bank
generation sales teams
Rebuilding Delivering margin Attractive
volumes improvement returns
Disciplined growth in wholly owned Land acquisition at a minimum 23% 2.5x dividend cover
home completions towards 20,000 over gross margin and optimising (at the appropriate time)
the medium term performance
Rebuilding to achieve a targeted minimum ROCE of 25%
30MARKET FUNDAMENTALS
Government 1.80%
target: average 2 year
300,000 homes fixed rate at 85%
per annum LTV
(1)
Demand continues Attractive land market Help to Buy Affordable rates
to exceed supply tapering from
1 April 2021
1) Rates are from an average of four lenders. Standard 85% product based on available rate with a fee not exceeding £1,000. Rates at June 2020
31MORTGAGE AFFORDABILITY REMAINS ATTRACTIVE
Average mortgage rate (%) (1) Halifax Mortgage Affordability Index (2)
2.8% 60%
Mortgage costs as a proportion of earnings
Help to Buy 75% mortgage product (20% equity loan) Halifax Affordability Index Average (1985-Q2 2020)
Standard 85% LTV mortgage product 55%
2.6%
50%
2.4%
Mortgage rate (%)
45%
2.2%
40%
2.0%
35%
1.8%
30%
1.6%
25%
1.4% 20%
Jun-15 Jun-16 Jun-17 Jun-18 Jun-19 Jun-20 1985 1990 1995 2000 2005 2010 2015 2020
(1) Rates are from an average of five lenders. Standard 85% product based on available rate with a fee not exceeding £1,000. HtB product based on the best available HtB equity share rate with no fee. Rates at June 2020
(2) The mortgage to earnings ratio is calculated using the Halifax standardised average house price (seasonally adjusted), averag e disposable earnings for all full time employees and the BoE monthly average rate for new advances
to households 32MORTGAGE LTV RESTRICTIONS
Maximum new build house Loan to Value criteria
evolution March - July 2020
• Mortgage affordability supported by
product rates continuing to be very low 100%
relative to historical levels March 2020 July 2020
95%
• Mortgage qualification is becoming more
challenging, particularly at high Loan to 90%
Values
85%
• Help to Buy remains an important bridge to
homeownership for many 80%
75%
70%
Lloyds Nationwide Barclays NatWest Santander HSBC Accord TSB
(Halifax)
Note: All the mortgage lenders also offer HTB mortgages with the exception of HSBC
33OUR PRIORITIES AND PRINCIPLES – DELIVERING FOR THE LONG TERM
To lead the future of
housebuilding by putting
customers at the heart of
everything we do
• Delivering our priorities and principles
• Sustainability creates long term value for our stakeholders
• Focus on measurable targets to deliver what matters most for
stakeholders
34SAFEGUARDING THE ENVIRONMENT
• Committed to be the leading national sustainable housebuilder
• Reduce carbon emissions across all of our footprint:
- Science based targets set
- 100% renewable electricity for own operations by 2025
- New standard house types will be net zero carbon in use
from 2030
- Net zero carbon emissions business across all direct
operations by 2040
• Create a net positive impact for ecology and biodiversity across
all developments that we progress through planning from 2020
onwards
Kingsbourne, Nantwich
35CURRENT TRADING
FY21 FY20
Change
8 weeks 8 weeks
Net private reservations per active outlet
per average week
0.94 0.68 38.2%
Average active outlets 334 366 (8.7%)
Net private reservations per average week 314 250 25.6%
Total forward sales (including JVs) (1) £3,706.5m £3,037.5m 22.0%
(1) As at 23 August 2020 and 25 August 2019
36CONCLUSION
• Strong operationally and financially
• Uncertain economic backdrop but attractive housing
market fundamentals
• Managing COVID-19 risks
• Focused on delivering operational improvements
• Continue to lead on quality and customer service
• Confidence to selectively return to the land market
• Building a sustainable business
Cherry Tree Park, Sunderland
37Q&A
New Lubbesthorpe, Leicester
38APPENDICES – INDEX
Page
Definitions 40
Current trading - forward order book 41
Current trading – forward sales roll 42
Full P&L 43
Calendarised P&L 44
Private completions – volume and ASP 45
Private average selling price 46
Home completions analysis – product type 47
Joint venture summary 48
Net interest charge analysis 49
Future financing arrangements 50
Balance sheet - land bank 51
Land creditors payment profile 52
Land prices versus house price inflation 53
Investing in our people 54
External benchmarks 55
Disclaimer 56
39DEFINITIONS
• Active outlet is a site with at least one home for sale
• ASP is average selling price
• Average cash (debt) is calculated on average daily closing position in period
• CCFF is Covid Corporate Financing Facility
• CJRS is Coronavirus Job Retention Scheme
• Earnings per share (EPS) is calculated by dividing the profit for the year attributable to ordinary shareholders by the weigh ted average
number of ordinary shares in issue during the year, excluding those held by the Employee Benefit Trust
• FY refers to financial year ending 30 June
• Gross margin is calculated as gross profit divided by total revenue
• HBF is Home Builders Federation
• Land bank years is calculated as total owned and controlled land bank plots divided by wholly owned completions in the 12 mon ths to
June
• MMC is Modern Methods of Construction
• Net cash is defined as cash and cash equivalents, bank overdrafts, interest bearing borrowings, prepaid fees and foreign exchange swaps
• Operating margin is calculated as operating profit divided by total revenue
• PBT is profit before tax
• Regional includes all regions excluding London
• Return on Capital Employed (ROCE) is calculated as earnings before intangible amortisation, interest, tax, operating charges relating to
the defined benefit pension scheme and operating adjusting or exceptional items for the 12 months to June, divided by average net
assets adjusted for goodwill and intangibles, tax, net cash, retirement benefit assets/obligations and derivative financial instruments
• Unless stated Joint Ventures (JV) in which the Group has an interest are not included throughout the presentation
40CURRENT TRADING – FORWARD ORDER BOOK
23 August 2020 25 August 2019 % change
£m Homes £m Homes £m Homes
Private 2,143.7 6,577 1,583.5 5,088 35.4% 29.3%
Affordable 1,277.6 8,249 1,133.9 7,089 12.7% 16.4%
Wholly owned 3,421.3 14,826 2,717.4 12,177 25.9% 21.8%
JV 285.2 834 320.1 887 (10.9%) (6.0%)
Total 3,706.5 15,660 3,037.5 13,064 22.0% 19.9%
41CURRENT TRADING – FORWARD SALES ROLL
23 August 2020 25 August 2019 % change
Private Total(1) Private Total(1) Private Total(1)
30 June 5,320 14,326 3,827 11,419 39.0% 25.5%
Reservations 2,424 2,773 1,999 2,531 21.3% 9.6%
Completions (1,167) (1,439) (738) (886) 58.1% 62.4%
23 Aug 2020 / 25 Aug 2019 6,577 15,660 5,088 13,064 29.3% 19.9%
(1) Including JV
42Full P & L
£m (unless otherwise stated) FY20 FY19 Change
Revenue 3,419.2 4,763.1 (28.2%)
Cost of Sales (2,804.9) (3,678.9) 23.8%
Gross profit 614.3 1,084.2 (43.3%)
Gross margin % 18.0 22.8 (480 bps)
Cost associated with legacy properties 39.9 3.2 n/m
CJRS grant income (22.8) - n/m
Adjusted gross profit 631.4 1,087.4 (41.9%)
Adjusted gross margin % 18.5 22.8 (430 bps)
Administrative expenses / part-exchange (1) (120.9) (183.1) 34.0%
Operating profit 493.4 901.1 (45.2%)
Operating margin % 14.4 18.9 (450 bps)
Cost associated with legacy properties 39.9 3.2 n/m
CJRS grant income (26.0) - n/m
Adjusted operating profit 507.3 904.3 (43.9%)
Adjusted operating margin % 14.8 19.0 (420 bps)
Net finance costs (1) (29.9) (28.8) (3.8%)
Share of JV/associate profit 28.3 37.5 (24.5%)
PBT 491.8 909.8 (45.9%)
(1) The Group has initially applied IFRS 16 using the modified retrospective approach. Comparatives have not been restated in respect of the adoption of IFRS 16
43CALENDARISED P&L
£m (unless otherwise stated) 12 months to Dec 19 12 months to Dec 18 Change
Revenue 4,897.3 5,018.8 (2.4%)
Cost of sales (3,791.6) (3,937.9) 3.7%
Gross profit 1,105.7 1,080.9 2.3%
Gross margin % 22.6% 21.5% 110 bps
Administrative expenses (196.2) (165.3) (18.7%)
Part-exchange (1) 3.6 1.5 140.0%
Operating profit 913.1 917.1 (0.4%)
Operating margin % 18.6% 18.3% 30 bps
Net finance costs (27.8) (37.0) 24.9%
Share of JV/associate profit 39.5 20.7 90.8%
PBT 924.8 900.8 2.7%
ROCE 29.3% 29.5% (20 bps)
Completions 12 months to Dec 19 12 months to Dec 18 Change
Private 13,756 13,802 (0.3%)
Affordable 3,953 3,336 18.5%
Total 17,709 17,138 3.3%
JV 839 739 13.5%
Total Inc JV 18,548 17,877 3.8%
(1) comparisons have not been restated in respect of the adoption of IFRS15 for the 6 months to 30 June 2018
44PRIVATE COMPLETION - VOLUME AND ASP
Homes: 1,984 (FY19: 2,687)
ASP: £250.0k (FY19: £243.8k)
Homes: 1,150 (FY19: 1,680)
ASP: £258.6k (FY19: £241.5k)
Homes: 1,899 (FY19: 2,555)
ASP: £361.3k (FY19: £359.6k)
Homes: 1,909 (FY19: 2,721)
ASP: £270.7k (FY19: £262.2k)
London
Homes: 148 (FY19: 604)
ASP: £754.8k (FY19: £628.5k)
Southern
Homes: 1,421 (FY19: 1,866)
ASP: £369.2k (FY19: £375.9k)
Homes: 1,057 (FY19: 1,420)
ASP: £320.6k (FY19: £315.9k)
FY19 numbers reported under FY20 regional structure 45PRIVATE AVERAGE SELLING PRICE
FY20 FY19
Homes ASP (£000) Homes ASP (£000)
Regional total 9,420 303.6 12,929 297.2
Central London 17 2,918.8 127 1,417.3
Outer London 131 474.0 477 418.5
London total 148 754.8 604 628.5
Total private wholly owned 9,568 310.6 13,533 312.0
46HOME COMPLETIONS ANALYSIS – PRODUCT TYPE
3% 4% 5 & 6 Beds
34% 30%
4 Beds
35% 3 Beds
35%
13% 1 & 2 Beds
12%
5% Flats (London)
5%
13% Flats (non-London)
11%
FY20 FY19
47JOINT VENTURE SUMMARY
Balance sheet
Number of JVs(1) Unsold plots (2) ASP (£’000)
investment (£m)
Central London 2 2 781 13.5
Outer London 3 2,389 343 123.8
Regional 3 616 290 14.1
Commercial - - - 0.7
Total 8 3,007 342 152.1
(1) Owned JVs as at 30 June 2020. Plots to legally complete as at 30 June 2020 Central London 115, Outer London 2,763, Regional 1,018
(2) Unsold plots as at 23 August 2020
48NET INTEREST CHARGE ANALYSIS
£m FY20 FY19
Interest on term debt and overdrafts (2.5) (2.4)
Interest on private placement notes 5.5 5.5
Utilisation / non-utilisation fees on RCF 3.5 3.8
Other interest 0.8 (0.4)
Total cash interest 7.3 6.5
Land creditors / deferred payables 19.9 21.5
Financing fees 2.3 2.8
Pension (1.6) (2.0)
Lease interest (1) 2.0 -
Total non-cash interest 22.6 22.3
Total interest 29.9 28.8
(1) The Group has initially applied IFRS 16 using the modified retrospective approach. Comparatives have not been restated in respect of the adoption of IFRS 16
49FUTURE FINANCING ARRANGEMENTS
Loan Facility Amount Maturity Interest basis
(1)
RCF facilities £700m November 2024 LIBOR +1.25-2.75%
Private placement notes £200m August 2027 2.77%
Eligible to access up to £600m under the CCFF if required
(1) Does not include utilisation and non-utilisation fees
50BALANCE SHEET – LAND BANK
Land bank plots 30 June 2020 30 June 2019
Plots with detailed planning consent 52,641 52,485
Plots with outline planning consent 15,615 13,443
Plots with resolution to grant and other 137 495
Owned 68,393 66,423
Controlled 11,931 13,599
Total land bank plots 80,324 80,022
JV plots – owned 3,896 4,149
JV plots - controlled 1,504 1,058
Total land bank plots (including JVs) 85,724 85,229
Land bank pricing (£’000)
Cost of plots acquired 43.2 42.3
Cost of plots in P&L 42.7 45.3
Cost of plots in balance sheet 44.9 45.6
Owned land bank ASP(1) 276 275
(1) At current prices
51LAND CREDITORS PAYMENT PROFILE
£m
52LAND PRICES VERSUS HOUSE PRICE INFLATION
Savills UK Residential Land Index versus UK Central London Land Price Index vs Prime
House Price Index London House Price Index (2007 peak =100)
140
Savills Central London Land & Prime London House Price
140
Savills UK Greenfield Residential Land Index and UK House
120 120
100 100
Price Index (100 = 2007 peak)
Index (100 = 2007 peak)
80 80
60 60
40 40
20 20
0 0
1999 2002 2005 2008 2011 2014 2017 2020 1999 2002 2005 2008 2011 2014 2017 2020
UK Greenfield Development Land Index UK House Price Index Central London Land Index Prime London House Price Index
53INVESTING IN OUR PEOPLE
• Mitigating industry skills shortages
• Future talent 7.4% of our workforce, 492 graduates,
apprentices and trainees
• Focus on diversity
• Award winning employment schemes
• Target 15% employee turnover in the medium term
• Accredited Living Wage Employer
54EXTERNAL BENCHMARKS
• 5 Star award for
11 years
• Only major
national
housebuilder to • 92 awards in 2020
achieve this • More than any other housebuilder • Large housebuilder of the year
for 16 consecutive years
• Best community initiative
• 93 accreditations
including 23
outstanding
awards
• More awards than • Gold award for 2019 • Best large housebuilder
any other • Crystal award for transparency in • Overall housebuilder of the year
company sustainability disclosure
55DISCLAIMER
This document has been prepared by Barratt Developments PLC (the “Company”) solely for use at a presentation in connection with the Company‘s Final Results Announcement in respect of the
year ended 30 June 2020. For the purposes of this notice, the presentation (the “Presentation”) shall mean and include these slides, the oral presentation of the slides by the Company, the
question-and-answer session that follows that oral presentation, hard copies of this document and any materials distributed at, or in connection with, that presentation.
The Presentation does not constitute or form part of and should not be construed as, an offer to sell or issue, or the solicitation of an offer to buy or acquire, securities of the Company in any
jurisdiction or an inducement to enter into investment activity. No part of this Presentation, nor the fact of its distribution, should form the basis of, or be relied on in connection with, any contract
or commitment or investment decision whatsoever.
Statements in this Presentation, including those regarding the possible or assumed future or other performance of the Company or its industry or other trend projections may constitute forward-
looking statements. By their nature, forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or developments
to differ materially from those expressed or implied by such forward-looking statements. Accordingly, no assurance is given that such forward-looking statements will prove to have been correct.
They speak only as at the date of this Presentation and the Company undertakes no obligation to update these forward-looking statements.
The information and opinions contained in this Presentation do not purport to be comprehensive, are provided as at the date of the Presentation and are subject to change without notice. The
Company is not under any obligation to update or keep current the information contained herein.
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