During the six months ended 30 June 2009 Persimmon legally completed 4,006 homes with total sales revenue of approximately £625 million against £998 million for the same period last year.
At 23 April 2009 Persimmon stated that sales for the first 16 weeks of the year were ahead of their expectations and since then, it says, sales volumes have consistently been ahead of the same period of 2008. More recently, both volume and revenues have shown increasing improvement on the comparative weeks of the previous year.
Persimmon says it expects this improving trend to continue against the weak conditions experienced throughout the second half of 2008. House prices have continued to decline throughout the six month period with an underlying reduction of c. 4% for the Group. The rate of decline has however reduced and their recent experience is that prices are now stabilising in some locations.
Further indications of an improved housing market are evidenced by the historically low level of cancellations of c. 16% they are currently experiencing and the significant reduction in their part exchange stock to c. £17 million against £120 million in June 2008.
Persimmon's landbank consists of c. 64,500 plots (June 2008: 76,159 plots), which represents a very healthy c. 7 years' supply at current rates of sale, it says. Given the good geographic spread and focus on more traditional house types within the landbank, currently they do not need to acquire more land to sustain their business. However, where they are able to identifying opportunities and agree terms to purchase new land on favourable terms, they will expand the landbank. Despite this they say they have not experienced any noticeable increase in the availability of good quality land at attractive prices.
They concude that they are encouraged by the improvement in sales rates when compared to last year, but remain cautious until mortgage availability improves further and employment prospects stabilise. In the meantime, they will continue to focus on cash generation and the reduction of debt levels in their business to ensure that they remain in a strong position.
