26th Feb 2019 07:39
LONDON (Alliance News) - Persimmon PLC on Tuesday reported double-digit growth in profit in 2018, exceeding GBP1 billion for the first time, boosted by higher average selling prices, but said its sales volumes have slowed at the start of 2019.
In addition, Persimmon said it has appointed David Jenkinson as permanent chief executive with immediate effect. Jenkinson was serving as interim CEO since November last year and has been with the company for 22 years.
"Since his appointment as interim CEO last year Dave has shown both strong leadership in maintaining the company's track record of operational excellence but also that he is listening carefully to the views of all our stakeholders," said Chair Roger Devlin.
The FTSE 100-listed housebuilder reported pretax profit of GBP1.09 billion for 2018, up 13% from GBP966.1 million the year before, on revenue that rose by 3.9% to GBP3.74 billion from GBP3.60 billion.
Persimmon said back in January it expected its pretax profit for 2018 to be "modestly ahead of market consensus", which stood at GBP1.08 billion, according to a Bloomberg survey cited by a company spokesperson.
During the year, Persimmon delivered 16,449 homes to customers, up from 16,043 in 2017, and sold those houses at an average selling price of GBP215,563, reflecting a 1.1% increase from GBP213,321 the prior year.
The housebuilder acquired 17,092 plots of land during the year, with 3,772 plots in 22 locations successfully converted from its strategic land portfolio.
Persimmon will pay a final dividend of 110 pence per share, on top of 125p per share as an interim dividend, for 235p in total, unchanged from a year earlier.
"Our results for 2018 reflect our successful focus on offering attractively priced new homes primarily to the first time buyer and first time mover markets, where housing need is greatest," said Jenkinson.
"We continue to invest in our teams, systems, and our off-site manufacturing capabilities to support the group's further growth," added Jenkinson.
Persimmon's average private sales rate per site in the first eight weeks of 2019 was 4% lower than the previous year. The company said it expects sales reservation volumes to pick up later in the year on release of the plots and sites currently under construction.
Persimmon said its current total forward sales, including legal completions taken so far in 2019, remain strong at GBP2.02 billion compared to GBP2.03 billion a year ago. The average selling price of private sales within the company's total sales is GBP238,800, 2% higher than at the same time last year, and pricing conditions remain firm.
"The board remains confident in the group's long term prospects," said Devlin.
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