Persimmon back in the black with £77.8m profit

HOUSEBUILDER Persimmon has reported a pretax profit of £77.8m in 2009 which has been boosted substantially by the re-evaluation of its land values.

The York-based company, which is the UK’s largest housebuilder by market value, saw its revenue fall 19% to £1.42bn while its house sales dropper to 8,976 from 10,202 a year earlier.

The £77.8m pretax profit – which includes the exceptional release of £74.8m of ‘net realisable value provisions’ – compares favourably with the £780m loss it made in 2008.

The company states in its final results for the year to the end of December 2009 that it is now focusing on achieving margin growth despite remaining ‘cautious’ about its investment decisions.

Persimmon – which is regarded as one of the less heavily indebted UK builders – reported net debt at the end of 2009 of 267.5 million pounds, against 600.7 million at the end of 2008.

The group reported strong forward sales of around £900m, up 29% on 2008 of £698m.

Persimmon said 90 new sites are scheduled to open in the first half of 2010.

John White, Group Chairman, said: “Persimmon has performed well throughout a period of difficult trading conditions.  Over the last twelve months we have concentrated heavily on cash generation and cost control. 

“This focus and the action we took during 2008 to restructure our business in light of the medium term outlook, has ensured that we remain strong and competitive. 

“The business is well positioned both operationally and financially for a recovering market.

“Prices have held firm since the beginning of the year and we remain focused on improving our operating margins and to profitably grow the business.”