Persimmon has reported a £77.8m pre-tax profit for the year ending 31 December 2009 after recording a loss of £780m during the previous year.
The turnaround was chiefly due a write-up in the value of the house builder's landbank. Pre-tax profit for the year was £7m before exceptional items, but Persimmon was able to write up its land value by £74.8m.
Persimmon said the write up in its land reflected “a combination of both an improvement in revenues and a reduction in development costs”.
Turnover was £1.42bn, down from £1.76bn in 2008. Persimmon built 8,976 homes in 2009 compared to 10,202 the previous year.
The average selling price of each home dropped to £160,513, from 2008’s figure of £172,994.
The group’s debt reduced to £267.5m from £600.7m.
Persimmon said it has £900m of forward sales, up 29% on 2008’s figure of £698m.
The house builder will open 90 new sites in the first half of 2010 and a further 40 are planned for the second half of 2010.
Persimmon group finance director Mike Killoran said: “We are recruiting again. We will probably need another 400 to 500 people if we can successfully bring through our new sites.”
He said Persimmon would build in the region of 10,000 homes in 2010, back to the levels last seen in 2008.
But Killoran added: “We have a few challenges still to face such as mortgage availability and the impact of public policy changes after the next general election.”
Group chairman John White said: “Our cash generation and cost control have placed the business in a strong position 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.”