Suggestions that housebuilders may be dragging their feet were firmly put to bed with news that Persimmon (PSN), the UK's largest housebuilder by market capitalisation, increased output in the second half by 30 per cent from a year earlier to 6,506, taking completions for the full year to 11,528, a rise of 16 per cent.
The idea that house price inflation is accelerating was also quashed as average selling prices rose by just 4 per cent to £180,900, all of which came as a result of a change in the sales mix away from apartments towards family homes.
Full-year results are due on 25 February, and finance director Mike Killoran hinted that margins will be higher for the year, thanks to greater use of land bought through from the strategic land bank. And, despite the sharp rise in completions, forward sales have also moved ahead significantly by 41 per cent to around £908m. In the light of these numbers, Numis has increased its estimates from £301m to £330m for 2013 pre-tax profits, and from £354m to £417m for 2014.
The land bank has also been strengthened, with new plots of 17,600, of which over 5,500 were converted from the strategic land bank. The increase equates to 153 per cent of current consumption, and leaves the way clear for further increases in output. And, despite the strong investment programme, cash balances edged up slightly to around £204m.
