Persimmon plc (“Persimmon or “the Group”) is today providing an update on trading and its ongoing response to COVID-19, in the period from 1 January 2020 to date, ahead of its Annual General Meeting (“AGM”) which is being held at 12.00 noon today.

Download the full results (PDF)

Highlights

Dave Jenkinson, Group Chief Executive, said: “In these unprecedented times we continue to be guided by our clear purpose of delivering long term sustainable returns for all our stakeholders. Focused management of the risks inherent in the housing market cycle has given us the financial strength to respond effectively and responsibly to the crisis and support our customers, our colleagues and suppliers, and the local communities we work in across the country, as the UK meets the challenges of the pandemic. We recognise the important contribution we make to the economy and wider society, and are determined to play our part.

“Our strong financial position and liquidity has enabled us to maintain our operational capability by retaining all staff on full pay through this period, without recourse to any Government financial assistance; to offer necessary support to our suppliers, subcontractors and local tradespeople; and to maintain our community and charity programmes, despite the economic shock of COVID-19.

“Persimmon is responding to the crisis from a position of strength, to the benefit of all its stakeholders; our long-term strategy and business model recognises the cyclical nature of the housing market, minimises financial risk through the cycle, and provides the flexibility needed to manage effectively through this difficult period. The Government has been clear that it wants the UK’s housebuilders to get back to building and this week we have started the phased process of getting back to work safely on site in order to deliver the new homes the country needs.”

• Trading Highlights
  • Strong start to the year in the period before the COVID-19 lockdown - average private sales rate per site was c. 10% ahead year-on-year in the first 11 weeks of the period
  • Customer enquiries have remained at good levels through the lockdown period providing
    some encouragement on the resilience of demand
  • Current forward sales position, including legal completions taken to date in 2020, remains robust at £2.4bn (2019: £2.7bn)
  • The average private selling price of a new Persimmon home in our forward order book is c.£244,500 (2019: c. £237,850), c. 17% below the UK national average¹, reflecting our
    commitment to providing ‘homes for all’
• Operational Highlights
  • From the start of this challenging time for the UK, our priority has been the safety, health and wellbeing of our customers, our workforce and the public and Persimmon fully supports the action taken by the UK Government and continues to follow all public health guidance
  • As announced on 24 April 2020, having developed and tested new site protocols
    incorporating the latest Government and Construction Leadership Council guidance on
    social distancing and protective measures, the Group has commenced a phased restart to work on site
  • To protect our entire workforce, these new measures will be strictly enforced by a specialist team, with a ‘COVID-19 Passport to Work’ governing site operation
  • The Group has not made use of the Government’s Coronavirus Job Retention Scheme to furlough staff and has no current plans to access any UK Government’s COVID-19 funding
• Customers remain at the centre of our business
  • Implementation of the Group’s customer care improvement plan remains a key priority
  • Customer care teams have remained active through the shutdown period and scheduled works will recommence as soon as restrictions on home visits are relaxed
  • Investment in our Homebuyer Retention Scheme, and customer care resource and training, had led to a c. 20% reduction in the time taken to resolve snagging items prior to the onset of the COVID-19 outbreak
  • The first phase of the Group’s customer portal, supporting customers from the point of their New Home Demonstration, will be operational shortly, with phase two due be rolled out in the second half of 2020
  • Development of “the Persimmon Way”, the Group’s consolidated approach to new home construction, continues to progress well
• Engaged and motivated colleagues underpin the Group’s success
  • Providing ongoing support to our colleagues working from home with regular contact through online team meetings and training modules
  • Strong belief in ‘opportunities for all’ with significant investment in training and
    apprenticeships across the Group to support career progression
  • Real Living Wage criteria introduced for all staff
  • Recognised as an industry leader by the Social Mobility Pledge
  • Excellent employee engagement - 96% of staff understand how their job contributes towards what Persimmon is trying to achieve
• Committed to creating and supporting sustainable communities
  • The Group’s activities support over 50,000² construction and supply chain jobs, including local tradespeople and suppliers in all 31 of our regional operating companies
  •  Persimmon’s construction activities generated £522m of affordable housing and planning contributions during 2019
  • The Group believes firmly in building ‘homes for all’, with more than 50% of its private new homes sales being made to first time buyers and c. 21% of its total volumes coming from its Partnerships business which serves those on lower incomes
  • Persimmon remains fully committed to its community and charity programmes and the work of The Persimmon Charitable Foundation and our partnership with Team GB, will continue through 2020
• Careful management of housing cycle risk is enabling Persimmon to respond to the crisis from a position of strength
  • A strong sustainable business model that; places customers at the centre of our business, maintains high quality land holdings, judges capital deployment at the right time in the cycle and minimises financial risk
  • Robust liquidity with a current cash position of £600m (as at 24 April 2020), deferred land commitments of £163m to the end of the current year and access to an undrawn £300m Revolving Credit Facility
  • Persimmon’s strong financial liquidity has enabled the Group to maintain its operational
    capability by supporting all our colleagues on full pay through the site shutdown period
  • The Group’s suppliers and subcontractors have been offered financial support, to help them manage through the crisis and preserve jobs and to ensure continuity of supply in the recovery
  • Colleagues working from home have continued to progress critical tasks during the site shut down period to prepare sites for the restart of activity. Home working will continue subject to further guidance provided by the Government and Public Health England
  • The increased investment in work in progress over 2019/20 places the Group in a strong
    position to support customers and provides some mitigation to the temporary site closures
  • The Group’s off-site manufacturing facilities will provide continuity of supply of key materials and will help mitigate any disruption as construction activity recommences
• Update on the Group’s purpose and culture to be given at today’s AGM
  • A copy of the presentation to be given at the AGM is available here
    www.persimmonhomes.com/corporate
  • Shareholders can view a live webcast of the AGM here https://persimmon.sparq.me.uk/ from 12.00 today

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