Persimmon PLC said on Wednesday it had made a strong recovery in 2021 from a lacklustre 2020, as it recovered profit and revenue.
The York, England-based housebuilder brought in total revenue for 2021 of £3.61 billion, up 8.4% year-on-year from £3.33 billion. This was only 1.4% short of pre-pandemic revenue of £3.66 billion in 2019.
Profit before tax grew 23% to £966.8 million, from £783.8 million. Persimmon said this was due to increased in operating margin of 40 basis points, up to 28% from 27.6% the prior year, resulting from ‘disciplined cost control, combined with a positive pricing environment’.
This was a substantial step towards recovering pretax profit of £1.04 billion in 2019, down 3.4% on a two-year comparative, having dropped 25% in 2020 from 2019.
Persimmon’s share price was up 5.1% to 2,440.58 pence each in London on Wednesday morning.
New home completions were up 7.2% year-on-year to 14,551 from 13,575 homes. The average selling price of homes was up 2.8% in the year to £237,078 from £230,543 in 2020, as Persimmon optimised the mix of homes sold, and increased the proportion sold to housing association partners.
Persimmon proposed a 125 pence dividend per share of surplus capital as an interim dividend for 2021 to be paid in April, and 110p to be paid in July. This would bring the total for the year to 235p, unchanged from 2020.
Looking ahead to 2022, despite uncertainty around inflation, interest rates and the global geopolitical situation, demand has stayed strong and interest rates favourable, leaving Persimmon in a strong position, the company said. It expects completions to be weighted towards its second half, as trading patterns normalise.
Chief Executive Dean Finch said: ‘The new year’s trading has started well, with private sales rates ahead by about 2% in the opening weeks and a robust forward sales position of £2.21 billion. We expect to grow our outlet position in 2022 and are targeting volume growth of 4% to 7% on 2021 levels, whilst maintaining our industry-leading margins, although we are mindful of the growing risk of an economic impact as a result of the tragic conflict in Ukraine.’
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