Barratt Share Price Rallies 8.6% as £175M Dividend Shelved

Shares of Barratt Developments (LON: BDEV) today surged 8.6% higher despite the company announcing that it would not be paying the £175 million special dividends scheduled for November 2021.

Investors cheered the board’s prudent decision given the current challenging business environment created by the coronavirus pandemic lockdown measures and the ensuing decline in economic activity and output.

The residential property development company released its results for the financial year ended 30th June earlier today revealing a 45% drop in pretax profits to £491.8 million from £909.8 million, as the COVID-19 pandemic significantly reduced the number of completed projects.

WELCOME BONUS - Free Share Bundle When You Invest £50! Get up to £500 cashback for investing with IG.

Invest in 15,000+ shares and ETFs. Open an account now, invest at least £50, and you’ll get a free share bundle worth between £40 and £200. T&Cs apply.

5.0

Open Account Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 68% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.

Barratt’s revenues fell 28% to £3.4 billion, while its gross profit margin fell to 18.0% from 22.8% after factoring in £74.3 million in coronavirus costs.

The company reported that current trading conditions had improved as the number of completed homes in the eight weeks to August 23 was up 62% compared to the prior period at 1,439 homes due to “pent up demand”.

Barratt share price

Barratt shares surged 8.6% to trade at 547.2p having ended Tuesday’s session trading at 503.6p.

• Here are our latest trending stories now
• Trade Barratt shares with the highly-rated IG UK
• Find alternative brokers to Hargreaves Lansdown