Scandal-hit Persimmon’s revenue up 4% to £3.7bn

York-based housebuilding giant Persimmon said on Tuesday it expects its pre-tax profits for 2018 will be “modestly ahead of current market consensus.”

In a trading update ahead of its final results, Persimmon said total group revenues rose 4% to £3.74 billion.

New housing revenues increased 4% to £3.55 billion.

Last November, Persimmon said its chief executive Jeff Fairburn would leave the company because criticism of his £76 million bonus package was a continuing distraction that had harmed the firm’s reputation.

In its trading update, Persimmon said: “Legal completion volumes increased by 406 new homes, a 3% increase, to 16,449 (2017: 16,043), including private sales of 13,341 new homes (2017: 13,274). 

“Our average selling price of c. £215,560 was 1% higher than last year (2017: £213,321).

“The UK housing market has continued to benefit from robust employment levels, low interest rates and a competitive mortgage market, which have supported confidence and customer demand across the regions …

“The value of the group’s forward sales at 31 December 2018 of c. £1,395m was 3% ahead of the prior year (2017: £1,356m) after second half legal completion volumes of 8,377, which were 305 stronger than for the first half of the year (H1: 8,072), an increase of 4% …

“We have continued with a selective approach to land replacement in line with our strategic priorities, being mindful of market cycle risks and wider economic uncertainties, including those associated with the process of the UK leaving the EU.  

“The group acquired over 17,000 plots of new land in over 80 locations through the year, with anticipated margins which continue to meet our targets.

“The group’s cash generation remains strong. Cash balances of c. £1,048m were held at 31 December 2018 (2017: £1,303m) after returning £732m of capital to shareholders in 2018 (2017: £417m).

“We anticipate our pre-tax profits for 2018 will be modestly ahead of current market consensus, having benefitted from the new developments we have opened through the year.

“The group continues to develop its manufacturing capabilities with the aim of better supporting sustainable growth …”