Persimmon profits down amid focus on improving quality
FTSE 100 house-builder Persimmon has posted a dip in profits after its efforts to improve quality slowed down the number of properties being sold.
The group reported profit before tax of £509.3 million for the six months to June 30, down from £516.3 million.
Total group revenue was 4.5% lower at £1.75 billion, as the number of new homes sold slowed to 7,584 compared with 8,072 this time last year.
Persimmon had already unveiled the lower sales rate in July, saying it had put the brakes on the process to ensure better customer satisfaction.
The company faced criticism last year as it handed out hefty bonuses to executives, despite relatively low customer satisfaction ratings.
But new chief executive Dave Jenkinson said the latest numbers showed it had made progress.
“Improving the quality and service delivered to our customers remains our top priority and I am encouraged with the progress made in the first half, which clearly shows that Persimmon is changing,” he said.
“Our customer satisfaction ratings for the current HBF survey year are showing improvement and I am particularly pleased that, in July, Persimmon became the first house-builder to introduce a retention scheme for customers, placing us at the forefront of strengthened consumer rights for home-buyers.”
The average selling price rose to £216,942, but remained lower than the national average for new-builds bought by owner-occupiers.
More than half of private sales were to first-time buyers.