Persimmon's (PSN) half-year figures ticked all the right boxes. Underlying pre-tax profits shot up by 40 per cent to £135m, legal completions increased 7 per cent to 5,022 homes and average selling prices rose 5 per cent to £179,199, thanks to a continued shift in the product mix towards family homes.
The bumper profit performance also reflected a sharp increase in operating margins, which rose from 12.1 per cent to 15.1 per cent. It also meant that the underlying return on capital employed jumped by over four percentage points to 14.1 per cent. The forward pipeline is impressive, too, with forward sales up by a fifth to £1.26bn, including over 1,700 reservations under the Help to Buy scheme, which launched earlier this year.
Finances are in good shape, too, buoyed by solid cash generation. In fact, even after the company invested £236m in 7,538 new plots of land, it still had net cash of £48m. And Persimmon remains on target to return £1.9bn of surplus capital to shareholders by June 2021, with the board expecting to make a 10p a share payment next June as part of an accelerated payment of the targeted 95p a share dividend due in June 2015.
Broker Numis Securities forecasts full-year EPS of 75.6p, up from 55.1p in 2012, rising to 90p in 2014.
| PERSIMMON (PSN) | ||||
|---|---|---|---|---|
| ORD PRICE: | 1,166p | MARKET VALUE: | £3.54bn | |
| TOUCH: | 1,166-1,168p | 12-MONTH HIGH: | 1,321p | LOW: 633p |
| DIVIDEND YIELD: | 6.4% | PE RATIO: | 18 | |
| NET ASSET VALUE: | 617p* | NET CASH: | £48.1m | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 807 | 96 | 24.9 | nil |
| 2013 | 900 | 133 | 33.3 | 75.0 |
| % change | +12 | +38 | +34 | - |
Ex-div: 22 Apr Payment: 28 Jun *Includes intangible assets of £241m, or 79p a share | ||||
