Despite more than doubling its pre-tax profit to £12.6m (£6.1m) housebuilder Persimmon is not complacent about the residential boom.
Chairman Duncan Davidson says that, although the demand for new homes is as strong as ever, he views the corresponding dramatic increase in land prices with caution.
In the year to December 31 the company sold 1,714 homes, up 41%, with an average value of £42,996, itself up 13%. Turnover was £73.7m (£46.4m). Mr Davidson says that his company is in the fortunate position of having a landbank of 9,000 plots with planning permission “bought at realistic prices”.
He adds that his aim is to maximise the return on the land, seeking profit rather than volume.
Earnings per share have increased from 7p to 13p and a dividend of 2.25p per share is being recommended. Mr Davidson adds that, since flotation three years ago, profits have increased at a compound rate of 70% pa.
