Persimmon: Growth Ambition Despite Cost Inflation

Despite an optimistic trading scenario, the British construction group Persimmon announces cautious forecasts regarding future rising construction costs and the announced increase in employer contributions to social security. In a recent statement to investors, the company emphasizes that initial signs of cost inflation are becoming apparent in price negotiations for the year 2025. Furthermore, Persimmon intends to counteract the financial impacts of new building regulations and the aforementioned social security contributions through close collaboration with the supply chain and strict commercial controls. An interim report for the second quarter up to the end of July reveals that Persimmon is on track to achieve the annual target of approximately 10,500 completions. In the third quarter, the company delivered 1,416 homes, a slight decrease compared to 1,439 in the previous year. Persimmon recorded a 3% increase in private housing to 1,267 units, while the number of partnership projects fell from 205 to 149. Forward sales rose by an impressive 40% to £1.45 billion, indicating more stable market conditions in 2024. CEO Dean Finch comments that the positive momentum of the summer months remains unbroken and that there are continued plans to increase the number of completions to around 10,500 for the entire year. Visitor numbers and inquiries remain strong, and sales figures are significantly above the previous year. The order book has grown by 17%, and average sale prices in the private market are stable. Finch emphasizes the ongoing focus on success through a commitment to quality and customer service, as well as the efficient conversion of land holdings into active construction projects.