Persimmon makes £66,000 profit per house

Grant Prior 2 years ago
Share

Persimmon has unveiled pre-tax profits of £966.8m for last year while making margins of 31.4%.

The house building giant completed 14,551 homes in 2021 with an average selling price of £237,078 and an average profit of £66,442 per home.

Shareholders received dividends of £748m during 2021 with similar returns earmarked for this year.

Group Chief Executive Dean Finch said: “The new year’s trading has started well, with private sales rates ahead by c. 2% in the opening weeks and a robust forward sales position of £2.21bn. We expect to grow our outlet position in 2022 and are targeting volume growth of 4-7% on 2021 levels.”

Build quality is now a major factor for bonus payments across the business.

Persimmon said: “Our senior management bonus scheme was restructured last year to incorporate build quality and customer service targets.

“In the current year, this approach is being extended across the organisation, including to our site management teams.

“Our sub-contract tendering process has been revised to emphasise quality and customer service performance alongside cost efficiency considerations.”

Persimmon has also more than doubled its team of Independent Quality Controllers, who check construction standards, from 29 to 60.

It said: “We believe this is the largest independent team of inspectors in the industry. Each key stage of development must be independently verified as complete and at the required standard before further work can continue.”

Build cost inflation of 5% has been partly offset by Persimmon’s in-house production which will be increased.

Smith said: “Our Space4, Brickworks and Tileworks factories have also proven crucial tools in both maintaining security and consistency of supply and securing build efficiencies, especially in a period of material and labour cost inflation.

“Through the bulk buying of raw materials and stable labour costs within our factories, we have been able to maintain a price advantage compared to the open market.

“Further, our use of Space4 timber frames in 33% of our homes built in the year, reduces our reliance on bricklayers, where labour shortages have been most pronounced.

“These factories will play an increasingly crucial role in our security of supply, quality control and drive to secure cost-efficiencies. We are already looking to expand production – through increased shifts and product lines – across our Brickwork and Tilework factories.

“We anticipate increasing output at Brickworks by 25% and at Tileworks by over 50% this year.

“We also plan to start building a new Space4 factory in 2022, updating the technology and techniques to drive enhanced quality and further efficiency gains. We anticipate – for example – that the new factory’s product will improve our speed of build by up to five days per house.”

Latest news

Police ban mobile cranes from roads over Easter

Plant hire bosses livid as forces across the country extend abnormal load embargoes
6 hours ago

Director jailed for exposing workers to asbestos

Ten tonnes of asbestos insulating board stripped out by unqualified workers
10 hours ago

Site labour rates start rising again

Industry's biggest payroll firm says "it feels like things could be turning round"
14 hours ago

Council finds extra £33m for Buckinghamshire link road

South East Aylesbury Link Road costs soar by nearly 30% to £147m
14 hours ago

Quartet win £490m North West & Central railway works deal

Skanska, Kier, Octavius Infrastructure and Story Contracting bag major projects deal
14 hours ago

Unite Students plans first major mixed-use scheme

Developer's first mixed BTR and PBSA project to be built in Edinburgh
1 day ago

Galliford Try names new finance director

Rentokil's Kris Hampson joins contractor to replace Andrew Duxbury
15 hours ago

Council boss hits out at bat threat to £274m road job

Natural England could scupper scheme due to be built by Ferrovial
15 hours ago

Hydrogen-fuelled diggers to be allowed onto highways

Government to raise barrier to widespread use of hydrogen fuelled plant in construction
1 day ago

Plans in for £118m Government hub in Darlington

Work pencilled to start later this year on new home for 1,450 civil servants
1 day ago

New contractor highlights Henry Construction jobs on website

New firm lists jobs by failed contractor to show its experience
2 days ago

Contractors line up for £2.6bn Anglian Water AMP8 deal

Eight big names land places on pioneering @one Alliance
2 days ago

McAleer & Rushe bags first major later living project

Work to start this month on 167-flat Royal Tunbridge Wells project
2 days ago

Kier starts first all-electric prison houseblock job in Kent

Next-generation fully electric T60 prison houseblock to be built at HMP Elmley
2 days ago

Keepmoat sees better times ahead in housing market

Profits dip in 2023 despite construction of record number of new homes
2 days ago

Vistry signs partnership deals for 1,900 mixed tenure homes

West Sussex former airfield and Newmarket sites to break ground
2 days ago

Turnover at Wates tops £2bn for first time

Construction division exceeds £1bn turnover as average contract value hits record high of £48.3m
3 days ago

L&G looks to sell Cala Homes in exit from house building

Insurance giant reported to be preparing to offload 3,000 homes-a-year developer
3 days ago

Multiplex profit almost trebles as margin hits 5.5%

Revenue jumps 20% to £675m as big London scheme complete
3 days ago

TopHat puts plans to open huge Corby factory on hold

Advanced manufacturing facility was due to employ 1,000 people
3 days ago

Laing O’Rourke lands Calderdale hospital job

Enabling works to start by the end of this year at West Yorkshire site
3 days ago

Go-ahead for £475m Sunderland film and TV studios

Work to start this year on first phase Corwn Work studios
3 days ago

Willmott Dixon set for £20m Stockport Community Hub

Planning decision expected in June on Marple leisure and health clinic project
3 days ago

Police hunt for blundering dumper truck thief

Raider drove into a fence before getting stuck on a bank
3 days ago

Beattie Passive files administration notice

Passivhaus pioneer has been in business for more than ten years
4 days ago

McAlpine set for £50m space and tech centre

Northumbria Uni sign pre-con deal for new satellite research hub
4 days ago

VolkerFitzpatrick seals £34m Kent road viaduct

Work to start next year on Sturry Link Road near Canterbury
4 days ago

Eight win £600m Scottish civil engineering framework

Balfour, Farrans, Graham and Morgan Sindall win major works lot
4 days ago

Site engineer crushed to death by excavator

22-year-old victim died just months after graduating from university
5 days ago

NG Bailey fined £135,000 after hospital site death

Worker died after striking overhead beam while navigating a mobile elevating work platform
6 days ago

Contractor services