Persimmon’s full year results suggest that demand has been resilient throughout the pandemic while revenues have held steady; however, completions and profit have naturally suffered.
Financial Highlights
| New home completions | 13,575 | 15,855 |
| New home average selling price | £230,534 | £215,709 |
| Total Group revenues | £3.33bn | £3.65bn |
| New housing revenues | £3.13bn | £3.42bn |
| Underlying new housing gross margins1 | 31.0% | 33.1% |
| Underlying profit before tax2 | £863.1m | £1,048.1m |
| Profit before tax | £783.8m | £1,040.8m |
| Cash at 31 Dec | £1,234.1m | £843.9m |
| Land holdings at 31 Dec – plots owned and under control | 84,174 | 93,246 |
| Current number of developments across the UK | c. 300 | c. 345 |
| Current forward sales position | £2.27bn | £1.98bn |
| Net assets per share | 1,102.7p | 1,021.7p |
| Return on average capital employed3 | 29.4% | 37.0% |
| Dividend | 110p per share in the year | 235p per share in the year |
Dean Finch, Group Chief Executive, said: “Persimmon delivered a robust performance in 2020 despite the challenges presented by the pandemic. I would like to commend our workforce for the effective way Covid-secure operating protocols have been adopted, protecting our customers, local communities and colleagues alike whilst maintaining effective on-site operations.
“I am particularly pleased we have delivered all this whilst continuing to see an increase in our HBF eight-week customer satisfaction score, with our current rates above the five-star threshold. We must build on this important progress and further enhance our build quality and customer care so we are known for both outstanding service as well as outstanding value. To achieve this we will further strengthen our build quality and independent inspection regime within the Persimmon Way. This will both drive efficiencies that will pay for these improvements and enhance our capabilities, enabling us to build a greater volume of homes at five-star. We have also set new environmental targets in line with the Paris Agreement and will seek to further develop the Persimmon Way to embed the specific measures that will deliver on these targets in the future.
“In addition, having adopted the principles of the Living Wage Foundation within our direct pay policies we are seeking full accreditation in working with our broader supply chain and development partners.
“Persimmon is a company of many strengths with great opportunities ahead. Combining the business’ entrepreneurial spirit and astute land buying with enhanced quality, efficiency and service standards will drive superior, sustainable value creation for our shareholders and broader stakeholders alike.”
Performance highlights
- The Group’s average private weekly sales rate per site for 2020 was 12% higher year on year reflecting good stock availability coming into the year and strong customer demand;
- Average selling prices increased by 6.9% reflecting the 6.5% increased proportion of homes sold to owner occupiers during the year;
- 2,212 new homes were delivered to our Housing Association partners in 2020, representing 16% of new homes sold (2019: 3,392 homes, 21% of new homes sold);
- £1,067m of net cash generation before capital returns of £351m and net land spend of £326m.
