Persimmon reports strong trading in first half of 2016

Persimmon reports strong trading in first half of 2016

Between January and June the national housebuilder increased completions by 6%.

In its latest Trading Update Persimmon has announced that the company witnessed strong trading through the first half of the year. The Group increased its legal completion volumes by 6% to 7,238 new homes in the period. It also reported that the average selling price had also increased by 6% to around £205,500. Group revenues of £1.49bn were 12% ahead of last year.

Persimmon reported that low borrowing costs and healthy labour market conditions continued to support consumer confidence through the first half of the year. Mortgage approvals for home purchase in the first quarter of 2016 were 18% ahead of the prior year.

It also noted that the company continued to experience delays to the start of construction on new development sites due to local inefficiencies in the planning system.

Site visitor numbers during the first six months of the year were 8% stronger than last year and the Group’s weekly private sales rate per site for the first half was 0.75, 4% ahead of last year. The average number of active sales sites in the first half of the year was 9% lower than last year at 355 sites.

Brexit

The company reported that it remains too soon to judge the effect that the result of the EU Referendum will have on the UK new homes market. The Update noted: “We believe that market fundamentals remain strong, supported by long term unfulfilled demand, and that the UK housing market will continue to provide good opportunities for those companies with the right strategic focus and the balance sheet strength to navigate future changes in trading conditions.”

The Group will announce its Half Year Results on Tuesday 23 August 2016.

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