Persimmon hails strong year as sales hit £2.6bn

PersimmonPersimmon has reported a 17 per cent increase in completions of house sales in 2014 despite heightened industry fears over a cooling housing market.

The York-based company reported a 23 per cent year-on-year rise in full-year revenue to £2.6 billion on Wednesday, slightly ahead of analyst estimates. It said it had fulfilled 13,509 legal completions.

The average new home sold at a 5 per cent premium over 2013 at £190,500, the company said.

“We’re incredibly pleased that we continue meeting the housing demand we’ve been seeing in the UK, and are keen to keep increasing our output, invest in the business and open as many sites as possible going into the new year,” said Persimmon chief executive Jeff Fairburn.

He added that forward sales stood at £973 million on December 31 2014, 7 per cent higher than the same time last year.

However, the Persimmon trading update also suggested that, in line with industry rivals including Bellway, rocketing growth in the UK’s housing market is returning to normal levels.

It said it expected “a return to a more traditional seasonal pattern to customer activity”.

“As indicated in our Interim Management Statement on 4 November 2014 we remain confident of a further improvement in operating margins for the second half of the year which will underpin significant growth in pre-tax profits and excellent cash generation for the year ended 31 December 2014,” added Persimmon.

“In line with the group’s long term strategy, during the year we identified a number of excellent opportunities for disciplined reinvestment in new sites in good locations which will generate superior returns and cashflow over the coming years.”

On Wednesday, housebuilding and construction company Galliford Try said it expected housebuilding revenue to be up on the prior year period, after ending the six-month period to 31 December with an “exceptional” order book of £3.2bn, up from £1.75bn in the first half of 2013.

Shares in Persimmon traded up 0.4 percent at 1,534 pence at 0834 GMT. The company will disclose detailed full-year results on Feb. 24.

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