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Persimmon sees 30% profit growth in first half

22 Aug 17 House-builder Persimmon has reported 30% growth in half-year profits on revenue up 12%

For the six months to 30th June 2017, Persimmon made £457.4m in profit before tax, up 30% from £352.3m made in the first half of 2016.

Revenue was up 12% to £1.66bn in the first half (2016 H1: £1.49bn).

The gross margin improved to 30.5% (2016 H1: 26.9%). The operating margin was 27.6% (2016 H1: 23.8%).

Group chief executive Jeff Fairburn said: "The successful execution of the group's long term strategy continues to support excellent trading results as seen again in the first half of 2017. Our focus on meeting market demand to deliver high quality sustainable growth in each of our 29 regional businesses is delivering excellent outcomes for our customers, our shareholders, and all our stakeholders.

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"The market remains confident. Customer interest in our developments remains strong with encouraging levels of interest through both our websites and our sales outlets as we trade through the quieter summer weeks. Our private reservation rate over recent weeks is 2% ahead year on year. Whilst we remain vigilant to changes in market conditions we also recognise we are in a strong position to take advantage of opportunities that arise. We are looking forward to a good autumn sales season.”

He concluded: "With a high quality land bank, very strong balance sheet and excellent forward sales the group has built a platform for its future success."

The Persimmon sales price increased by 3.7% to £213,982 and the sales price for Charles Church rose by 9.4% to £347,819. Improvement in Charles Church average pricing reflects a greater focus on premium locations. Charles Church delivered 900 new homes in the period (2016: 973) whilst Persimmon legally completed 5,630 new homes (2016: 5,143) across its network of 29 regional businesses. Private sales accounted for 84% of group sales; sales to housing associations totalled 1,264 new homes (2016: 1,122 new homes).

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