July 5, 2018 / 6:27 AM / 3 months ago

Persimmon reports revenue rise as house prices inch up

(Reuters) - Britain’s second largest homebuilder Persimmon Plc (PSN.L) reported a 5 percent rise in first half revenue on Thursday, fuelled by improved house sales and a 1.2 percent rise in average prices.

FILE PHOTO - A sign is displayed at a Persimmon construction site in Dartford, southern Britain August 21, 2015. REUTERS/Neil Hall/Files/File Photo

Persimmon, which has focused on building cheaper family houses less prone to tightening at the top of the UK housing market, said resilient consumer confidence and continuing low interest rates had boosted demand for new homes.

Persimmon, which has a range of homes across England, Wales, Scotland, said housing revenue rose 5 percent, with sales rising 3.6 percent to 8,072 homes. That compared to 8 percent a year earlier.

Mortgage lender Nationwide said last month that British house prices rose at their slowest annual rate in five years in June and look set to remain subdued due to modest economic growth and squeezed household budgets.

But Persimmon is among housebuilders to have said pricing remains firm across its regional markets.

The FTSE 100 company said it expects sequential improvement in the company’s underlying housing operating margin in the first half of 2018, helped by cost cuts. The company’s underlying housing operating margin stood at 28.8 percent in the second half of 2017.

Persimmon said forward sales had also risen 5 percent compared to a year ago to 1.68 billion pounds.

Total revenue rose to 1.84 billion pounds from 1.75 billion pounds in the six months ended June 30.

Reporting by Arathy S Nair in Bengaluru; editing by Patrick Graham

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