Strong year for Persimmon as revenues rise 8%
HOUSEBUILDER Persimmon saw revenues rise 8% to £3.14bn in 2016, boosted by “healthy customer demand” for new homes.
The Yorkshire-based group updated the markets on its performance this morning ahead of its final results for December 31, 2016, which will be released on February 27.
Persimmon said legal completion volumes increased by 599 new homes to 15,171 (2015: 14,572) and the group’s average selling price increased by 4% to around £206,700 (2015: £199,127).
Sales reservations through the autumn season were strong with “healthy customer demand” for new homes, the group said, as buying a new-build home remains a “compelling choice” supported by competitive mortgage offers which continue to make a new home purchase affordable.
The group’s private sales rate for the second half of the year was 15% ahead of the prior year and second half legal completion volumes of 7,933 were 695 stronger than for the first half of the year (H1: 7,238).
Persimmon opened 255 new development sites across the UK during the year and is building on all sites which have an implementable planning consent.
It said it expects its gross margin in the second half to have improved further due to a combination of the continued reduction in land cost recoveries associated with opening new sites, and the continued strong control over development costs.
During the year Persimmon acquired around 18,700 plots of new land in 83 locations.
The company said: “We continue to see good opportunities to acquire additional land whilst remaining mindful of the risks associated with the uncertainty arising from the UK’s decision to leave the EU. We continue to work hard to bring forward opportunities from the group’s strategic land portfolio which will add to the quality of the group’s asset platform. We expect local authorities to continue to progress their plans to support growth in housing delivery in line with the National Planning Policy Framework.”
The group held cash balances of around £913m at December 31 2016 (2015: £570m).
.
