Number of homes built last year down a third but firm finished 400 homes more than it predicted

Persimmon鈥檚 home completions dropped 33% last year but were higher than the housebuilder had previously forecast just two months ago.

Last November, the business said it , which would have been 36% down on the 14,868 built in the previous year.

But in a trading update published this morning, Persimmon revealed it had in fact built 9,922 homes after a better-than-expected fourth quarter performance.

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Persimmon built close to 10,000 homes last year

The group also saw its private average selling price rise by around 5% to around 拢286,000 鈥� up from 拢272,000. The average selling price at its partnerships business rose 8% to 拢153,000.

It said its full-year operating margins were expected to be in line with the 14% delivered in the first half of the year.

鈥淭his reflects the impact of build cost inflation, coupled with the effects of lower volume, one-off costs associated with the remediation of a small number of completed sites and accelerated exit from two sites, along with further investment to position the business for future success,鈥� it added.

The firm鈥檚 forward sales position was up 2% on the prior year at 拢1.06bn, of which 拢499m relates to private forward sales, up 4%.

Dean Finch, group chief executive, said the business had 鈥減erformed well in challenging market conditions鈥� and had 鈥渟uccessfully balanced our need to control costs, whilst investing in the business to position it for sustainable growth when conditions improve鈥�.

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>>See also:

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Andy Murphy, director of financials and industrials at investment relations firm Edison Group said the trading statement 鈥渟howcase[s] the company鈥檚 resilience amidst the challenging market conditions for UK housebuilders鈥�, but said 鈥渞ising mortgage rates, lower buyer demand and inflated costs of raw materials鈥� had impacted completion rates.

In a note, broker Investec added: 鈥淯nderstandably, management are not providing any guidance for 2024, but expect market conditions to remain highly uncertain. Mortgage rates have eased. Clearly the upcoming spring selling season is the next key catalyst for the sector and key is how quickly Persimmon can build its site numbers back and at what margins.鈥�

The firm will release its 2023 results on 12 March.

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