House builder expects 50% rise in profits
Leading house builder Persimmon has said it is expecting its annual results next month to reveal an increase in pre-tax profit of 50 per cent.
In a trading statement today the company says its analysts’ expectations for 2011 are that underlying profit before tax will be between £130 million and £148 million, with a consensus of £139 million. ‘This will be towards the top end of analysts’ expectations,’ the statement says.
Persimmon’s completions have remained steady at 9,360 compared to 9,384 last year. It says take up of the government’s Firstbuy scheme has been ‘encouraging’ allowing it to complete more starter homes in 2011. This has led average selling prices to drop by 2 per cent to £164,000.
Persimmon also reports an increased landbank of 63,500 plots, compared to 58,862, and forward sales of £615 million, compared to £565 million last year.
The statement says: ‘While the general economic backdrop to the UK housing market remains challenging we have experienced encouraging levels of visitors, resilient sales reservations, low cancellation rates and stable prices.
‘As previously reported, we saw a return of the traditionally stronger autumn selling season in 2011.’
The group’s full results for 2011 will be published on 28 February.