Housebuilder reports strong demand
Persimmon shrugs off Brexit with customer surge
In its half year statement, the company said customer response has been “robust” and cancellations have returned to normal levels.
“Whilst the result of the EU Referendum has created increased uncertainty, the news was quickly digested by our customers,” said the company.
“Customer interest since then has been robust with a strengthening of visitor numbers to our sites compared to the same period last year, visitors per site per week being c. 20% ahead year on year.
“After a modest increase in the week following the referendum result, cancellations have returned to normal levels and are currently running slightly lower than the same period last year.
“As usual we continue to monitor market activity closely whilst also reviewing broader external conditions to ensure our actions remain disciplined and aligned with our strategic objectives.
“Since 1 July our private sales rate has been 17% ahead of the same period last year.”
Results for the first six months reflect robust revenue growth, further improvement in operating profitability, free cash generation, and a strong balance sheet.
Profit before tax increased by 29% to £352.3 million (2015: £272.8m) on revenue up 12% to £1.49 billion (2015: £1.33bn).
The group said it remains focussed on successfully executing the ten year strategic plan launched at the start of 2012.
Jeff Fairburn, group chief executive, said: “Persimmon’s robust trading performance in the first half of 2016 was driven by our continued focus on meeting market demand to deliver controlled sustainable growth. The group’s strong cash generation has supported further disciplined land investment embedding value for the future.”
“The group is now trading through the traditionally slower summer weeks but customer demand remains encouraging and we anticipate a good autumn sales season.”
Chairman Nicholas Wrigley added: “We are encouraged by the continued healthy demand for mortgage support with lenders approving c.198,000 loans for house purchase during the second quarter of the year, a very similar number when compared with the same period last year which was buoyed by last year’s General Election result.
“We anticipate a good autumn sales season once the summer holiday period comes to an end in early September.
“We plan to increase our build activity and productivity to continue the sustainable growth of the business to reach optimal scale in each of our regional markets. We aim to improve the availability of stock for our customers whilst the prompt delivery of each new home will continue to support the excellent level of Group returns. We anticipate our cash generation will remain strong.”