GOVERNMENT regulations are making developments four per cent more expensive to build, retirement homes giant McCarthy & Stone has warned.

New soundproofing rules under Part E of the building regulations is forcing the south coast developer to change "long established" building designs.

McCarthy & Stone, which has a number of developments in Southampton and on the Waterside, has just smashed through the £100m profit barrier for the first time with its latest set of record results.

Profit before tax rose 54 per cent to £116m for the year to August 31. Turnover rose 35.6 per cent to £255.1m.

Earnings per share were 76.5p, a rise of 55 per cent. Shareholders will see a final dividend of 9.8p, giving a total 13.7p for the year (2002: 11.4p).

"We have a very strong cash position (2003 £82.5m; 2002 £53.5m), said Keith Lovelock, who last month celebrated ten years as chief executive.

"We have a well-bought and well-located land bank and we maintain a significant share (71 per cent) in the growing market for retirement housing."

McCarthy & Stone last year finished 1,693 units with a further 2,092 under construction - an increase of eight per cent. It has enough land for a further 5,628 units.

Mr Lovelock has taken over as chairman after the failed takeover bid by founder and then chairman John McCarthy in June.

John McCarthy later decided not to pursue an offer and resigned as chairman.

Mr Lovelock intends to remain as chairman but will relinquish his role as chief executive "in due course".

The company's headquarters are in Bournemouth.