The UK’s largest housebuilder, Barratt Developments, is to push up its dividend payouts after increasing pre-tax profit by 8.8 per cent in the first half of its financial year.

The group will pay out an interim dividend of 7.3p, up 22 per cent, and will cut the level of dividend cover on its ordinary payments to 2.5 times from 3, resulting in higher payouts to shareholders.

The FTSE 100 group said it was increasing payouts “given the significant operational and financial improvements the group has made over the last few years”.

In first-half results released Wednesday, Barratt said it had pushed up pre-tax profit by 8.8 per cent to £321m in the six months to December despite a drop in completions as its London production slowed.

The group completed 7,180 homes in the six months, down 5.8 per cent, resulting in revenues 3.2 per cent lower than a year earlier at £1.8bn. Barratt said it expected a “significant” increase in London completions in the second half.

David Thomas, chief executive, said:

With a record forward order book, strong consumer demand and a positive lending backdrop, we remain confident in our outlook for the full year. Our confidence in the business going forward is reflected in the improved and extended capital return plan.

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