Housebuilder Persimmon said its full-year pre-tax profit rose 1% to £585.1 million following a 'very challenging year'.

For the year to the end of December, the company said revenues fell 4% to £3.1 billion and completions were down 4.8% to 15,905 units, in line with expectations. Shares rose 13p, or 2%, in early trade to 777 pence.

The order book also decreased 19% to £1.1 billion, compared to £1.3 billion last year, more than the 14% fall announced in January. 'Since then reservations have been lower than the same strong period of 2007,' the company said.

'Visitor levels have improved each week since the beginning of the year but conversion to sales ratios have remained challenging,' it added.

However, Persimmon improved its operating margin to 21.8% from 20.8%, following tight cost control and synergy savings, and said home average selling prices increased by 1% to £189,558.

The group also reported improved cancellation rates, which fell to around 20% from more than 30% in autumn 2007.