Final Results for the year ended 31 December 2016
- Focus on disciplined high quality growth delivers excellent full year performance
- Underlying profit before tax* increased by 23% to £782.8m (2015: £637.8m)
- Full year revenue up 8% to £3.14bn (2015: £2.90bn)
- Legal completions increased by 599 new homes to 15,171 (2015: 14,572) and average selling price increased by 3.8% to £206,765 (2015: £199,127)
- Operating margin* increased to 24.8% (2015: 21.9%); with second half improvement to 25.7%
- 41% increase in cash generation pre capital returns to £681m (2015: £483m)
- Return on average capital employed** increased by 23% to 39.4% (2015: 32.1%)
- A further 18,709 plots of land acquired in the year, with 11,268 plots successfully converted from the Group’s strategic land portfolio
- Underlying basic earnings per share* increased by 19% to 205.6p (2015: 173.0p)
- Net cash of £913.0m at 31 December 2016 (2015: £570.4m)
- Forward sales ahead at £1.89bn (2016: £1.74bn), an increase of 9%
Long term strategy
- Completion of fifth year of our ten year strategic plan, with performance well ahead of original expectations
- Successfully delivering growth - new home legal completions ahead by over 60% since launch of plan in 2012
- Successfully returning surplus capital - £1,071m, or £3.50 per share, of excess capital returned since launch of plan in 2012
- Strong performance of the business enabled the Capital Return Plan to be increased by 45% to £2.76bn or £9.00 per share in February 2016, together with a further acceleration of the payment schedule.
- The Group’s continued outperformance in 2016 is enabling a further increase in the Capital Return Plan to be announced today, with an additional payment of 25 pence per share, increasing the total value of the Plan by c. £77m to £9.25 per share. This new 25 pence per share payment will be made on Friday 31 March 2017 as a first interim dividend in respect of the financial year ended 31 December 2016.
- In addition the Board confirms that the scheduled capital return of 110 pence per share will be paid on 3 July 2017 as a second interim dividend in respect of the financial year ended 31 December 2016.
* stated before goodwill impairment of £8.0m (2015: £8.3m)
** 12 month rolling average and stated before goodwill impairment
Nicholas Wrigley, Group Chairman, said:
"The Group has now completed the first five years of its long term strategy which remains focused on growing Persimmon into a stronger, larger business while maintaining capital discipline and robust free cash generation. The strength of the Group’s operating model is demonstrated by our ability to grow completion volumes by more than 60% and investing c. £2.6bn of cash in land through this period while simultaneously returning over £1.0bn of excess capital to shareholders."
"Customer activity in the early weeks of the 2017 spring season has been encouraging. The further increase in the Capital Return Plan demonstrates the Board’s confidence in the Group’s prospects."