Profits to exceed expectations, predicts Persimmon

 

One of Britain’s largest housebuilders, Persimmon Homes, has announced a modest rise in revenues, numbers of homes sold and expects profits to come in ahead of expectations.

Market analysts have forecast that the York-based company will record a profit of £1.07 billion to 1.08 billion when its full figures are published next month. Persimmon say revenues increased by 4% to £3.74 billion in 2018, and that its forward sales for 2019 are ahead by 3% to £1.40 billion.

Sales and average selling price up

The group sold 16,449 properties last year, a 3% rise totalling 406 more than in 2018, with a Persimmon home selling for an average of £215,560 – 1% up on the previous twelvemonth. They see the UK market as benefiting from “robust employment levels, low interest rates and a competitive mortgage market.”

They also report that they bought over 17,000 plots in over 80 locations in 2018 and expect that their full report in February will show that:

“…pre-tax profits for 2018 will be modestly ahead of current market consensus, having benefited from the new developments we have opened through the year.”

It’s the first report from Persimmon since the departure of former chief executive Jeff Fairburn in November. Fairburn faced huge public criticism after collecting a bonus worth around £75 million and walked out of a BBC TV interview after being asked about the subject. He was subsequently asked to step down from his role by the company because of the “negative impact on the reputation of the business”, and left Persimmon on 31 December.

Looking ahead to a post-Brexit property market, Persimmon feel they are in a position of strength regardless of how the UK’s departure from the EU plays out.

“Whilst the future performance of the UK economy is currently subject to increased levels of uncertainty, the Group is well positioned with its strong outlet network together with the availability of a range of attractive house types at affordable prices across the regions of the UK, supported by a high-quality land bank and conservative financial structure.”

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Profits to exceed expectations, predicts Persimmon

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