Persimmon 2015 interim results

DividendMax Ltd.

Persimmon 2015 interim results


Profit before tax increased 31% to £272.8m (2014: £208.9m)

Revenue up 11% to £1.33bn (2014: £1.20bn)


The Group's long term strategy is to deliver superior shareholder value through the housing cycle. The management team are focussed on delivering this value by growing the Group to optimal scale whilst exercising disciplined, well-judged capital investment through the cycle. A key feature of the strategy is the delivery of strong cash generation enabling shareholders to receive capital that is considered surplus to the reinvestment needs of the business. Management's long term commitment to shareholders is to return £6.20 per share, or £1.9 billion of capital, to shareholders over a ten year period to June 2021.

Total surplus capital of £2.40 per share, or £733 million, has now been paid to shareholders. The fourth instalment under the plan is scheduled for early July 2016 and will be finalised with the 2015 Full Year results of the Group scheduled to be announced on Tuesday 23 February 2016.

Legal completions increased 7% to 6,855 new homes sold (2014: 6,408), average selling price increased 4% to £194,378 (2014: £186,970)

Further expansion of underlying operating margin* to 20.5% (2014: 17.7%), an increase of 280bps

Return on average capital employed** increased by 27% to 27.5% (2014: 21.7%)

Strong land investment with 11,539 plots of land secured in the period bringing consented land bank to 92,404 plots

Continued success in securing planning consent for the Group's strategic land bank with 2,974 plots converted in the period

Net free cash generation*** of £191m in the period (2014: £122m)

Net cash of £278m at 30 June 2015 (2014: £326m)

Underlying basic earnings per share* increased 43% to 78.6p (2014: 54.8p)

Current forward sales 12% ahead at over £1.71bn (2014: £1.53bn)

Third payment of surplus capital under the Capital Return Plan of £291m (95p per share) paid 2 April 2015

* stated before goodwill impairment

** 12 month rolling average stated before goodwill impairment

*** net free cash generation stated before Capital Return Plan payments

Jeff Fairburn, Group Chief Executive, said: "Persimmon has traded well in the first half of 2015. The Group continues to take advantage of the current market opportunities to deliver sustainable growth whilst also utilising its excellent cash generation to build a strong asset platform for the future. We have now entered the traditionally slower summer weeks for the market. Our private sale reservation rate since 1 July is currently 5% ahead of the same period last year which is a reflection of the continuation of healthy customer demand.

The performance in the first half of 2015 further demonstrates the results of the Group's focus on successfully executing its operational objectives and the delivery of the ten year strategic plan launched in 2012. We are confident that our long term strategic focus through the current cycle will continue to deliver strong returns for our shareholders."

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