Housebuilder Persimmon returns to pre-Covid building levels

PA

Housebuilder Persimmon has revealed the impact from the Covid-19 pandemic has seen the number of homes it built in the first half of the year fall 35% to 4,900 compared with 7,584 a year earlier.

With building sites shut and managers scrambling to implement social distancing measures, homes could not be completed and pre-tax profits plunged 43%.

But the company said the lifting of restrictions and resumption of construction means building levels returned to pre-Covid levels by the end of June and its strong balance sheet meant staff were paid in full during lockdown.

Chief executive Dave Jenkinson said the performance was enough for the board to agree to a 40p per share dividend being paid out.

He added: “Taking an early decision not to take advantage of the furlough scheme for any colleagues, we maintained good momentum in the business, continuing to serve our customers, making detailed preparations for a safe return to work and, when it was appropriate, restarting our build programmes efficiently.”

Sales of private homes since the start of July have jumped 49% year on year, with a current forward order book of £2.5 billion – up 21% on last year.

Mr Jenkinson explained: “Our strong opening work in progress position and excellent build rate through the summer give us confidence in a positive second half out-turn.

“We expect that by the end of September, we will have delivered (circa) 45% of our anticipated second half new home legal completions.”

Estate agents and lenders have reported a surge in interest in households looking to move – particularly with greater space as City dwellers in particular look at moves to greener spaces with City offices mainly closed.

Revenues for the six months to June 30 were £1.19 billion, down from £1.76 billion a year earlier.

Gross margins on new housing fell from 33.8% to 313% and pretax profits plunged from £509.3 million to £292.4 million.