Housebuilder Persimmon experienced a strong start to 2012 with the spring selling season continuing to outperform the previous year as weekly private sales rise around 20%.
The York-based company, which has seen visitor levels to its sites rise 10% over the first fifteen weeks, said it is confident it can operate successfully in current market conditions. Cancellation rates are running at historically low levels of 17%.
"We continue to be encouraged by the level of customer enquiries registered on both our Persimmon Homes and Charles Church websites and we have seen a further increase in interest following the Government's launch of the NewBuy 95% loan-to-value mortgage guarantee product in March," it said.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Persimmon believes the scheme will support increased sales activity for the UK housebuilding industry once all the major mortgage lenders have entered the market.
Its order book, including legal completions already achieved for the current year, rose 9% from last year to £1.24bn.
The FTSE 250 firm, which recently announced a new long-term strategy to develop into a larger business over the next decade, said as part of this strategy its plans to return £1.9bn (£6.20 per share) of capital to its shareholders over the next nine and a half years.
It added that further progress has been made on margins and cash generation and recent weeks' sales confirm that the trend of increasing profitability is continuing.
Persimmon's cash position end of March was £12m compared to borrowings of £113m in 2011.
"Whilst the availability of mortgage credit remains the key constraint on the UK housing market, we remain confident that Persimmon can operate successfully within existing market conditions as we execute our new strategy and build a larger, stronger Persimmon over the next decade," the group said.
CJ
-
What happens if you can’t pay your tax bill, and what is "Time to Pay"?Millions are due to file their tax return this Friday as the self-assessment deadline closes. Though the nightmare is not over until you pay the taxman what you owe - or face a penalty. But what happens if you can't afford to pay HMRC your tax bill, and what is "Time to Pay"?
-
What does Rachel Reeves’s plan for growth mean for UK investors?Rachel Reeves says she is going “further and faster” to kickstart the UK economy, but investors are unlikely to be persuaded
