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Persimmon build rate ahead of pre-Covid levels

28 Apr 21 Observance of Covid site protocols is doing nothing to slow Persimmon’s productivity, the house-builder said today.

In a stock market trading update, Persimmon reports that build rates across its developments are at pre-pandemic levels depite maintaining all Covid-secure protocols.

Customer enquiry levels remain encouraging, it said, and the average private sales is not just well ahead of 2020 but also 17% ahead of 2019.

Chief executive Dean Finch said: "Persimmon has made a strong start to the year with current forward sales 23% ahead of last year and 11% ahead of the same point in 2019. Our build rates continue at pre-Covid levels and we remain on track to deliver first half volumes approaching those of the first half of 2019. We are progressing our land holdings and taking advantage of good quality investment opportunities, bringing 6,000 plots across 29 locations into the business in the period and securing a strong pipeline for the future. Our current outlet network is expected to remain stable at approximately 300 outlets on average throughout the year.”

He added: "Demand for newly built homes remains healthy and the group's sales rates are encouraging. Persimmon's high quality land holdings, balance sheet strength and liquidity provide a strong platform to continue to deliver the homes the country needs, underpinning long-term sustainable returns for the benefit of all of its stakeholders."

David O’Brien, equity analyst at Goodbody commented: “Persimmon has delivered a solid update, placing at the front of the pack in the recovery of the UK housing market as we gradually emerge out of lockdown. Demand for new homes remains healthy boosting sales, and the company is on track in terms of volumes for the first half of 2021, with the expectation that levels will return to those pre-crisis.

“Furthermore, the group continues to guide for volumes in the second half of 2021 to be in line with the first, implying around 15,200 units for the year as a whole. This means that expectations are for 2021 volumes to be just 4% below 2019 levels. Beyond 2021, a net land spend of £140m year-to-date gives comfort that Persimmon can continue to ramp-up outlet numbers and thus leave the group primed to deliver further growth into 2022.

“This robust performance positions Persimmon as the market leader in the sector, and the industry more widely should be encouraged by its performance as it continues to go from strength to strength with the continued easing of pandemic restrictions.”

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