Persimmon profits soar as margins improve

Aaron Morby 12 years ago
Share

Persimmon has dismissed talk of a softening housing market and staged a return to the big profits of a few years ago.

A tight grip on costs, kept lower than last year, and a higher number of completions at better prices helped Britain’s third biggest house builder return to past form.

Pre-tax profit for the year increased to £154m from £78m in the prior year.

Even before exceptional items, underlying profits came in a shade under £100m, strongly ahead of £7m last time.

Chief executive Mike Farley said: “Site activity for the first eight weeks of 2011 is encouraging.

“Visitor levels are around 10% ahead of the same period last year, cancellation rates of 16% remain at historically low levels and net private sale reservations are 2% ahead.”

“We continue to seek further cost improvements and efficiencies which, together with the introduction of new sites into production, will assist further progress in improving our operating profit margin,” he added.

Over last year, sales revenue rose 10% to £1.6bn as housing completions rose 4.5% to 9,384 homes and average selling price rose nearly 6% to £167,249.

The improvement came from a 3% rise in underlying selling price and  a change of mix of homes.

Persimmon managed to double operating margins to 8% in 2010, although they are still a long way from the margins achieved in the previous housing boom.

Home completions rose to 9,384 from 8,976 and the average selling price of Persimmon’s homes rose 5.7% to 167,249 pounds.

Persimmon currently has 380 sites in development and expects to open 70 sites in the first half of this year.

The house builder’s timber frame business Space 4 saw sales of housing kits rise 31% during the year to 2,738. Space4 has an order book of 3,000 units and expects to achieve double digit growth this year.

Its up-market southern housing arm Charles Church saw volumes recover strongly in the second half of the year with the business now accounting for a fifth of total completions.

The main Persimmon operating company won planning consents on strategic land parcels including 650 plots at Trowbridge and 200 plots at Cullompton in the South West.

Latest news

John Lewis £500m funding deal to build 1,000 rental homes

Deal to advance BTR flats at store sites in Bromley, West Ealing and Reading
2 hours ago

Eric Wright wins tricky £52m Liverpool transformation

Contractor working with engineers at Ridge and Partners on "challenging" Stanley Lock Flight site
2 days ago

Investment giant buys Bristol M&E contractor

RDCP Infrastructure acquires Avon Combined Electrical Services
2 days ago

Demolition start for £50m Farnworth town centre rebuild

Caddick Construction is tipped for main works due to start in the spring
3 days ago

L&G Modular strikes deal to build 1,000 affordable homes

Modular homes business teams up with Hampshire's Vivid housing association
3 days ago

Former Erith operations director joins John F Hunt

Scott Exell named new operations director at demolition specialist John F Hunt
3 days ago

Green light for £135m Leeds twin tower resi scheme

Construction to start in New Year on 500 build-to-rent apartments
3 days ago

Mace hits 1m tonnes carbon saving target for clients

Present work pipeline betters 2026 carbon emission saving target
3 days ago

Plans in for £40m surf park at former Kent colliery

Seahive surf lagoon and health resort will be built near Deal
4 days ago

Crushed demolition worker vows to return to industry

Shannon Brasier hoping to return to construction following horror accident
3 days ago

Mount Anvil to start 900-home North London estate rebuild

Planning approval paves way for Barnsbury Estate rebuild in Islington
3 days ago

Green light for major laboratory campus in Cambridge

Developer BioMed to tender first building on 600,000 sq ft lab complex in the New Year
4 days ago

Belfast firm signs the biggest work deal yet under Project Gigabit

Fibrus to hook-up rural Cumbria to lightning-fast broadband under £108m deal
3 days ago

McLaren wins Leeds logistics park contract

Work to start imminently on warehouse complex for Firethorn Trust
4 days ago

Work restarts on £683m waste power plant after site death

Construction suspended for a week of investigations following fatality
4 days ago

Demolition starts on £135m Wigan Galleries scheme

Contractor BCEGI starts work on project to redevelop Wigan town centre
5 days ago

Amey CEO to step down following private equity buyout

Amanda Fisher to leave once business is transferred to new owners
4 days ago

New body set up to vet plant operator card schemes

Contractor trades bodies unite to tackle competency concerns over plant operator skills cards
4 days ago

Kier leads switch to hybrid battery generators

Battery units work alongside smaller generators cutting run times by nearly 60%
4 days ago

Plans in for first Leeds co-living scheme

Watkin Jones submits plan to convert old Direct Line HQ into 230 studio flats
5 days ago

Demolition worker crushed by excavator

Court hears 20-year-old woman was left with "life changing injuries"
5 days ago

Government pays £700m for 50% stake in Sizewell C

New body, Great British Nuclear, will be set up to develop pipeline of nuclear projects
5 days ago

Costain wins Heathrow Airport asset renewal deal

Firm takes early contractor involvement role in Terminal 2 baggage handling upgrade
5 days ago

Worker killed on £683m waste power plant site

Fatal collision involving heavy goods vehicle on giant north London site
6 days ago

HS2 JV shifts four Wembley Stadiums of earth in record time

EKFB team digs and hauls 15 million cu m of muck in 20 months
6 days ago

Milestone wins £300m Wiltshire highways upkeep

Ringway will hand over to Milestone in March next year
5 days ago

Low-risk business model helps Renew post record results

Renew reveals latest acquisition with £15.6m purchase of water specialist Enisca
6 days ago

London Albert Embankment hotel towers approved

Two separate hotels rising to 26 and 29 storeys approved
6 days ago

Keltbray names new director of strategic engineering

Tim Lohmann takes up newly-formed role to drive innovative engineering solutions
6 days ago

Go-ahead for £200m lithium refinery on Teesside

Work to start next year on Europe's first lithium hydroxide processing plant
6 days ago

Contractor services