RETIREMENT housebuilder McCarthy & Stone has seen profits fall despite its revenue rising to a record figure.

Clive Fenton, chief executive of the Bournemouth-based PLC, said a strong performance in the second half of the year had boosted its annual figures.

In the 12 months ended August 31, revenue rose four per cent to £661million, while average selling prices were up three per cent to £273,000.

But underlying profit before tax was down by 10 per cent to £94.1m, while pre-tax profit overall was down by one per cent to £92m.

The company said the drop reflected the higher incentives it had offered to sell homes, as well as higher building costs.

Legal completions were in line with the previous year at 2,302 units – despite a “significantly lower” number of first occupations, down from 69 to 49. The company pointed to a strong recovery in its underlying margin in the second half of the year.

Mr Fenton said: “We achieved a strong result in the second half of the year and delivered an improvement in both margins and volumes compared to the first half of FY17.

“Our full year completion volumes were in line with the prior year despite some headwinds as a result of the increased level of uncertainty in the secondary market and the expected lower number of first occupations.

“We delivered to market 49 high-quality new developments and maintained our exceptional build quality and levels of customer satisfaction.

“The group starts the new financial year with a strong forward order book and a robust balance sheet. We remain focused on delivering profitable growth and are on track to open around 80 sales outlets and deliver more than 65 first occupations in FY18.

“We have sufficient land under control, much of which already has detailed planning consent, to deliver our strategic growth plan of building and selling more than 3,000 units per annum.”

The company said forward sales as of November 10 were up 11 per cent on last year to £277m.

McCarthy & Stone, founded in Bournemouth 40 years ago, employs 170 people at its Holdenhurst Road HQ, 60 at its southern regional office in Ringwood and more than 1,000 nationwide.

It has repeatedly called for incentives to help people move into retirement properties and release their existing homes into the market.