Persimmon PLC Trading Update (9986L)
25 April 2018 - 4:00PM
UK Regulatory
TIDMPSN
RNS Number : 9986L
Persimmon PLC
25 April 2018
TRADING UPDATE
WEDNESDAY 25 APRIL 2018
Persimmon plc ("the Group") announces the following trading
update covering the period from 1 January 2018 to date, ahead of
its Annual General Meeting ("AGM") which is being held at 12.00
noon today.
The Group continues to focus on building family housing at
affordable prices across the UK. Customer activity since the start
of the year has been encouraging with the Group's total enquiry
levels running c. 13% ahead of the prior year. This has resulted in
robust trading since the start of the year with visitor levels to
site, sales conversion rates and cancellation rates all running in
line with our expectations.
The Group's forward sales position remains very strong with
total forward sales revenue, including legal completions taken to
date in 2018, of GBP2.76 billion, being c.8% higher than last year
(2017: GBP2.56 billion). Our weekly private sales rate per site
since the start of the year of c. 0.85 (2017: c. 0.83) reflects
solid market conditions. We have 9,048 (2017: 8,928) new homes sold
forward into the private ownership market with an average selling
price of c. GBP236,500 (2017: c. GBP229,500). Pricing conditions
remain firm across our regional markets. The Group has also
maintained a substantial forward order book of new homes for
delivery to its Housing Association partners, with 5,330 (2017:
4,616) new homes included in our forward sales position.
The Group has opened 65 of the c. 100 new sites planned for the
first half of the year and is building new homes on all sites that
have an implementable detailed planning consent. The Group is
currently developing 375 active sales outlets across the UK. During
the period we continued to identify good opportunities to acquire
new land on a selective basis to support the future growth of the
business.
To help meet demand for new housing in all of its regional
markets and to support the sustainable growth of the Group, six new
operating businesses have been opened over the last three years,
bringing the total regional house building businesses to 30. Since
the launch of the Group's new strategy in 2012 the Group has built
and sold over 80,000 new homes across the UK.
The development of our off-site manufacturing capability will
play an increasingly important role in supporting the expansion of
our new home construction volumes. Our manufacturing hub at
Harworth, Doncaster where the Group continues to invest in new
manufacturing capacity to help improve the supply of essential
construction materials is a major differentiator for Persimmon. In
2017 the Group opened a new brick manufacturing factory and has
announced it is to establish a new roof tile manufacturing facility
during 2018 to further strengthen the reliability of our new home
delivery and to support further growth. In addition, the Board will
continue to review plans for the expansion of the Group's Space4
business to extend its reach for the supply of timber frames,
highly insulated wall panels and roof cassettes to Group companies
across the UK.
Exercising capital discipline through the cycle whilst growing
the business as market conditions allow are key features of the
Group's strategy. Our Capital Return Plan ("the Plan") to return
surplus capital to shareholders continues to be a fundamental
element of this capital discipline. The Group's successful trading
performance over the six years to the end of 2017, increasing
annual output by over 70% and opening 1,189 new sales outlets
whilst investing c. GBP3.2 billion in land, has enabled the Board
to increase the total value of the Plan. In total, the Group has
generated GBP2.77 billion of free cash before the return of surplus
capital over the six years since the launch of the Group's
strategy.
As announced on 27 February 2018, additional payments under the
Plan of 125p per share will be paid over the next three years in
late March/early April each year. The first of these additional
payments of GBP389 million, was paid to shareholders as an interim
dividend on 29 March 2018. At the same time the Board recommended
that the scheduled return of 110p per share, or c. GBP345 million,
will be paid to shareholders on 2 July 2018 as a final dividend.
With the scheduled payment on 2 July 2018, the total value of the
capital returned by that date of GBP2.22 billion will be GBP1.36
billion greater than that originally planned at launch in 2012.
The additional payments over the next three years will bring the
total value of the Plan to GBP13.00 per share, more than double the
GBP6.20 per share original commitment made by the Board in 2012.
The total value of the Plan is now c. GBP4.07 billion.
Total shareholder returns to date from the launch of the Group's
new strategy in 2012 now exceed 500%.
The Board remains confident of the future prospects of the
Group.
We will provide a further report in our Trading Update on
Thursday 5 July 2018.
For further information please contact:
Jeff Fairburn, Group Chief Executive Simon Rigby
Mike Killoran, Group Finance Director Kevin Smith
Persimmon plc Jos Bieneman
Citigate Dewe Rogerson
Tel: +44 (0) 1904 642199 Tel: +44 (0) 20 7638 9571
This information is provided by RNS
The company news service from the London Stock Exchange
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