Business is booming for Persimmon (PSN), the only housebuilder not to require a rescue capital injection in the downturn. Legal completions rose 28 per cent to 6,408, while average selling prices rose 4.3 per cent to £187,000, helping boost operating margins from 15.1 per cent to 17.7 per cent.
The company replenished its land bank, acquiring 10,549 new plots in the first half. It was also successful in pulling through plots from its so-called strategic land bank, which does not have planning permission. At the end of June, plots owned and under control totalled 82,250 - more than six years' supply at the current run-rate.
Trading in the first few months of the second half is traditionally a quiet period, but private sale reservations since 1 July are running 9 per cent ahead of the previous year. This is despite stronger prior-year comparatives created by the launch of the Help to Buy scheme. The value of current forward sales is up 22 per cent from last year at £1.53bn, with over 5,500 private new homes sold for future delivery.
Persimmon is generating a lot of free cash, and remains committed to returning 620p per share in the ten years up to June 2021. Having paid 70p this July, the next scheduled payment is 95p next July. Analysts at Citi Research are forecasting full-year pre-tax profits of £435m and EPS of 109p (from £330m and 82p in 2013).
| PERSIMMON (PSN) | ||||
|---|---|---|---|---|
| ORD PRICE: | 1,343p | MARKET VALUE: | £4.1bn | |
| TOUCH: | 1,342-1,344p | 12-MONTH HIGH: | 1,429p | LOW: 988p |
| DIVIDEND YIELD: | 6.5% | PE RATIO: | 13 | |
| NET ASSET VALUE: | 656p | NET CASH: | £326m | |
| Half-year to 30 Jun | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 | 0.90 | 133 | 33.3 | 75 |
| 2014 | 1.20 | 209 | 53.5 | 70* |
| % change | +33 | +57 | +61 | -7 |
Ex-div: na Payment: na *Paid on 4 July | ||||
