Revenues for the year were up 10.5% on 2009 to £1.57bn, while underlying pre-tax profits reached £95.5m, compared to £7.0m in 2009.
Underlying operating profit for the year, before exceptional items and goodwill charges, was £128.7m (2009: £57.2m), representing an 8.2% operating margin (2009: 4.0%).
After receiving no dividends last year, this time shareholders are getting 4.5p per share, on top of their 3p interim dividend.
Group chairman John White said: "Despite a continuing low level of mortgage approvals, the group is achieving improving returns and remains well positioned for the upturn in the housing market when it occurs."
Legal completions increased 4.5% to 9,384 new homes in 2010, compared to 8,976 in 2009. Average selling price of £167,249 was 5.7% ahead of 2009’s £158,272.
Group chief executive Mike Farley said that site activity for the first eight weeks of 2011 was encouraging. Visitor levels are 10% up on the same period last year, cancellation rates of 16% are at historically low levels and net private sale reservations are 2% ahead. “However, general market indicators remain mixed and there remain significant challenges ahead,” he added.
Mr Farley concluded: “Persimmon has reacted well tosignificant changes in its market over recent years. We expect the rate of change in many aspects of our business to continue, from the planning regime to Zero Carbon; from the mortgage market to regulation. Our proven ability to understand and react to these influences whilst strengthening our balance sheet and maintaining our strong order book will mean that Persimmon is well placed to take advantage of market opportunities as they arise.”
Space4 success
Persimmon’s annual results also noted the growth of Space4, its patented closed panel timber frame business. Demand for this energy efficient construction system increased 31% in 2010 with the business delivering 2,738 housing kits, compared to 2,089 in 2009.
Group chief executive Mike Farley said: “The improvements made to the product portfolio with the introduction of the Space4 Eco housing range in 2009 has led to a significant pick up in order intake. Space4 has delivered product to the majority of the Group's businesses as the benefits of using the system have become established.
“Our ability to satisfy the more demanding building regulations associated with the Code for Sustainable Homes requirements up to Code Level 4 has provided Space4 with the opportunity to provide a build solution at an optimal cost level which reduces our costs of build when compared to more traditional construction methods. Approximately 95% of total Space4 2010 production was delivered to group companies compared with c.85% in 2009.
Space4 currently has a forward order book of 3,000 units and we anticipate further double digit growth in output volumes for the current year. We are confident that Space4 will support our ability to respond to increasing levels of demand as market conditions improve whilst also mitigating the potential cost pressures that may arise when production volumes increase.”
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