26th Jun 2006 07:01
Persimmon PLC26 June 2006 TRADING UPDATE - MONDAY 26TH JUNE 2006 Persimmon plc announces the following trading update ahead of its InterimResults to 30th June 2006, which will be announced on Tuesday 22nd August 2006. The six months to 30th June 2006 has been another successful period forPersimmon. Sales reservations so far this year on a like for like basis havebeen ahead of the prior year by c. 7%. Total sales revenue to date for the fullyear 2006, including c. 8,000 legal completions already achieved is c. £2.4billion (H1 2005: £1.78 billion) from c. 13,000 units (H1 2005: 9,974). This isa strong sales position to have achieved at this stage of the year. We have also completed the integration of Westbury since we acquired it on 17thJanuary 2006 and achieved all our short term objectives. Specifically, we havereduced the relatively high levels of work in progress in that business bytargeting the sale of stock units and reducing the level of part exchangeproperties. We have also managed the acquired land assets in line with ouroriginal plans. This action has accelerated the reduction in debt levels aheadof our initial estimates. Gearing will be c. 55% at 30th June 2006 and is asignificant reduction from the level of 80% gearing immediately following theWestbury acquisition. The housing market continues to be active and is operating at a satisfactorylevel which provides us with the opportunity to develop further our business. Aspreviously stated, we expect to see a modest level of price inflation this yearin both selling prices and build costs. Incentives continue to be offered on aselective basis and selling costs are running at similar levels to the secondhalf of 2005. As stated above, the enlarged Group will have legally completed c. 8,000 unitsduring the six months to 30th June 2006 (H1 2005: 5,954 units) an increase of c. 34% at an average selling price of c. £188,000 (H1 2005: £183,581). Turnoverwill be over £1.5 billion (H1 2005: £1.09 billion). As expected, margins arebeing diluted by the impact of the Westbury acquisition. However, the action wehave taken on the Westbury sites will result in the improvement of those marginsover future months. We also continue to focus on maximising margins in whatcontinues to be a competitive housing market. We currently have a landbank of c.78,000 plots owned or under control. Inaddition, during the period we have made satisfactory progress with severalexciting land opportunities held in our strategic land portfolio including someof that acquired with the Westbury acquisition. We expect to give more detailedinformation on these situations as matters progress over the next few months. We have made good progress during the period and are in a strong position tomove forward. Debt levels have been reduced in advance of our plans, we now havethe appropriate level of work in progress and land investment, and with ourhealthy forward order book are on track to deliver further growth during 2006 inline with existing expectations. We will give further details when we announce our Interim Results on Tuesday22nd August 2006. For further information, please contact: Persimmon plc Finsbury GroupJohn White, Group Executive Chairman Faeth Birch / Kirsty FlockhartMike Farley, Group Chief Executive Tel: 020 7251 3801Mike Killoran, Group Finance DirectorTel: 020 7251 3801 on 26 June 2006Tel: 01904 642199 thereafter This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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