Barratt cuts bosses' pay as it furloughs 85% of workers

The FTSE 100 company said Chief Executive David Thomas, Chairman John Allan and other executive and non-executive directors would have their pay cut until construction work restarts.

The reduction from April also applies to Barratt's wider executive and managing director team. Barratt's top people will also waive any pay increase for the 2021 financial year.

Barratt unveiled the pay cuts as it said about 85% of its employees would be furloughed under the government's job protection programme until the end of May at the earliest. The government will pay up to 80% of workers' wages to a maximum of £2,500 a month and Barratt will pay the rest.

The company said the pay cut for senior employees was made "to reflect the ongoing focus on preserving cash within the business … We will continue to assess further cost‐saving opportunities available to us as the situation develops, whilst balancing the long‐term requirements of our business."

Britain's biggest housebuilder closed all its construction sites, sales centres and offices on 27 March because of the coronavirus pandemic. It finished some homes after that date.

Barratt said between 23 March and 12 April it completed 1,349 homes taking the total completed so far in its financial year to 11,713 compared with 10,954 a year earlier. The company has 12,376 forward sales at a value of £2.89bn.

The company said any further completions or reservations would be very limited while its operations were closed. It reiterated that financial guidance was not possible during the uncertainty of the Covid-19 crisis.

Barratt said it was financially strong with £450m of cash on 14 April, an undrawn £700m revolving credit facility and £200m of fully drawn US private placement notes.