TIDMPSN
RNS Number : 0743R
Persimmon PLC
26 February 2019
Persimmon plc today announces Final Results for the year ended
31 December 2018.
Chairman's Overview
"Since the launch of the Group's strategy in 2012 we have
focused on increasing the strength, resilience, and performance of
Persimmon for the long term. Building a strong vibrant business
where our employees are proud to work, constructing well designed
traditional homes and creating sustainable communities throughout
the UK remains our central focus."
Highlights
-- Legal completion volumes increased by 406 new homes to 16,449 (2017: 16,043) with an average
selling price of GBP215,563, up 1% year on year (2017: GBP213,321)
-- Total Group revenue for the year increased by 4% to GBP3.74bn (2017: GBP3.60bn)
-- 2018 new housing operating margin* of 30.8% increased from 28.2% last year, with a second
half new housing operating margin* of 31.8%
-- 13% increase in total Group operating profits to GBP1.083bn (2017: GBP0.955bn)
-- 13% increase in Group profit before tax to GBP1.091bn (2017: GBP0.966bn)
-- 11% increase in basic earnings per share to 283.3p (2017: 255.0p)
-- 52.8% return on average capital employed** (2017: 51.5%)
-- 17,092 plots of land acquired in the year, with 3,772 plots successfully converted from the
Group's strategic land portfolio
-- Net cash of GBP1.048bn at 31 December 2018 (2017: GBP1.303bn)
-- Strong forward sales position at GBP2.02bn (2018: GBP2.03bn)
-- Interim and Final dividends of 125p and 110p per share respectively declared for 2018
-- Appointment of Dave Jenkinson as Group Chief Executive announced separately today
-- Range of new customer service initiatives implemented in late 2018 showing encouraging initial
results. The Group is confident these measures will improve its customer satisfaction score
once they have had time to take effect
-- Significant investment in training to address the skills shortage in the house building industry
-- Adoption of the Living Wage Foundation payment criteria for our employees from January 2019
-- Persimmon is proud to be a sponsor of Team GB who will compete at the 2020 Tokyo Olympics
Long term strategy
-- Track record of strong operational performance continues:
-- Successfully delivering growth - seven new house building businesses opened over the last
four years, supporting a more than 75% increase in new home legal completions since the launch
of the Group's new strategy in 2012
-- Successfully investing in future growth - GBP3.81bn invested in land since the launch of the
new strategy
-- Successfully returning surplus capital - GBP2.22bn, or GBP7.20 per share, of excess capital
returned since 2012
Dave Jenkinson, Group Chief Executive said:
"Our results for 2018 reflect our successful focus on offering
attractively priced new homes primarily to the first time buyer and
first time mover markets, where housing need is greatest. This
strategy has enabled Persimmon to grow its construction volumes by
more than 75% since 2012, making a significant contribution to UK
housing supply. My focus is to build on this strong platform,
maintaining our operational momentum, but also implementing a
number of necessary new initiatives in customer care. A wide range
of projects to improve customer satisfaction commenced in late 2018
and the initial results have been encouraging, giving us confidence
in our ability to make progress in this important area. We continue
to invest in our teams, systems, and our off-site manufacturing
capabilities to support the Group's further growth."
"We are also taking action to address the shortage of skills in
the industry, with almost 15% of our workforce in structured
training programmes across the business. We continue to nurture and
develop our best talent and I am delighted that over 570 colleagues
were promoted during the last two years recognising their success
in developing their careers with Persimmon. The Group is proud to
support over 20,000*** construction jobs and over 30,000*** jobs in
our supply chain."
"Whilst the sales outlook remains subject to a degree of
uncertainty at the start of any financial year, at this point the
Group's sales are in line with management's expectations. Given our
strong prior year comparatives, the current increased uncertainties
with respect to the future performance of the UK economy and the
planned later sales releases in the early part of the year, we are
encouraged by the levels of customer interest across the UK.
Including legal completions taken so far in 2019, the Group has a
strong forward sales position at GBP2.02bn and we currently
anticipate delivering a similar level of legal completions during
2019 as in the prior year."
Roger Devlin, Group Chairman, said:
"Persimmon is changing. In his short time as interim CEO Dave
Jenkinson has introduced new approaches to customer satisfaction
and colleague engagement, whilst also ensuring that the Group
delivered another year of growth. These changes are illustrative of
wider efforts across the Group to evolve our processes and
practices to pursue excellence across all aspects of our business.
Achieving further progress with these initiatives will be a key
priority for Dave in his new post as CEO."
"The Board remains confident in the Group's long term
prospects."
* Stated before goodwill impairment of GBP9.2m (2017: GBP11.0m)
** 12 month rolling average and stated before goodwill
impairment
*** Estimated using an economic toolkit
For further information, please contact:
Dave Jenkinson, Group Chief Executive Simon Rigby
Mike Killoran, Group Finance Director Kevin Smith
Jos Bieneman
Persimmon plc Citigate Dewe Rogerson
Tel: +44 (0)20 7638 9571 (on 26 February Tel: +44 (0)20 7638 9571
2019)
Tel: +44 (0)1904 642 199 (thereafter)
Analysts unable to attend in person may listen to the
presentation live at 09:45am by using the details below:
Telephone number: +44 (0)20 7192 8338
Password: Persimmon
Webcast link: https://edge.media-server.com/m6/p/es4z7za5
An archived version of today's webcast analyst presentation will
be available on www.persimmonhomes.com/corporate this
afternoon.
CHAIRMAN'S STATEMENT
Delivering on our long term strategy
I was appointed Chairman on 1 June 2018. Persimmon is a great
company with an excellent track record of growth. And as one of the
largest house builders in the UK, Persimmon places great importance
on the contribution the company makes to the communities it serves.
The company continues to deliver strong commercial performance and
we appreciate that success remains dependent on delivery for all
our stakeholders - notably our customers, our people, our suppliers
and Government. We are stepping up our efforts to continue to
improve customer satisfaction levels with a number of new
initiatives being introduced which we believe will bring
significant improvements for our customers. Alongside that we are
changing our pay and incentives to include greater emphasis on both
quality and customer care with plans that are more rigorous than we
have had in the past. We remain focused on making a good
contribution to increasing the industry's output of new homes
across the UK so that more people gain access to good value,
well-designed homes in line with Government policy and targets. We
will continue to invest in our own manufacturing capabilities -
timber frame construction, brick and tile works - to ensure we are
able to support our development programmes over future years.
Results
Persimmon delivered a very strong performance in 2018, with
revenues increasing by 4% to GBP3,737.6m (2017: GBP3,597.8m) and
profit before tax increasing by 13% to GBP1,090.8m (2017:
GBP966.1m). The Group delivered 16,449 new homes to customers
across the UK (2017: 16,043), an increase of 406 new homes compared
with last year. The Group's average selling price of GBP215,563 was
1% higher (2017: GBP213,321).
The Group's long term strategy prioritises the creation and
preservation of superior shareholder value through the economic
cycle by building good quality homes for our customers; providing
rewarding careers for our employees and giving continuity of
business to our suppliers. We are focused on delivering high
quality growth to meet market demand across the UK, investing in
land and infrastructure to support further increases in new home
construction which local communities need. To support this growth
we opened our seventh new operating business in four years on 2
January 2019, the new team being based near Doncaster in Yorkshire,
which takes the total number of Group housebuilding businesses to
31. Since the launch of the Group's new strategy in 2012 Persimmon
has made a significant contribution to increasing housing supply
across the UK by investing GBP3.81bn in land, opening 1,370 new
sales outlets, and delivering 97,175 new homes to the market by
increasing annual production by over 75%.
Persimmon has been successful in growing each of its regional
housebuilding businesses towards optimal scale and through
achieving the associated operational efficiencies the Group
delivered a housing operating margin of 30.5% in 2018 which was 260
basis points higher than the prior year (2017: 27.9%). Operating
profit of GBP1,082.7m was 13% ahead of last year (2017: GBP955.1m).
We opened c. 180 new sales outlets in 2018 providing support to the
Group's lower level of land cost recoveries from the new home sales
legally completed from these sites.
Profit before tax increased by 13% to GBP1,090.8m (2017:
GBP966.1m) and basic earnings per share of 283.3 pence were 11%
higher than last year's 255.0 pence.
In line with our strategic priorities which seek to maximise
cash efficiency and capital discipline through the cycle, the
Group's liquidity remains strong. The Group held GBP1,048.1m of
cash at the end of the year (2017: GBP1,302.7m).
The Group has continued to reinvest for the future acquiring
17,092 plots of new land across 84 high quality locations through
the year, with our strategic land holdings contributing 3,772
plots. In the second half of 2018 we acquired 6,020 plots of new
land across 39 locations. The Group's net land spend of GBP605.1m
for the year includes GBP279.3m in the second half which included
GBP145.8m of existing land creditor payments. The Group's land
creditor commitments at 31 December 2018 were GBP548.0m, GBP19.3m
lower than the prior year.
Return on average capital employed* was 52.8% for 2018, slightly
ahead of the previous year (2017: 51.5%).
Long term strategy and Capital Return Plan
The Group's strategy is focused on mitigating the risks to
sustainable shareholder value creation inherent in the UK housing
market by maintaining capital discipline and delivering strong free
cash generation through the housing cycle. Minimising financial
risk while retaining flexibility to support an appropriate level of
reinvestment in the business are key features of our strategy. Our
disciplined approach to land replacement aims to support each of
our 31 housebuilding businesses to reach optimal scale by bringing
land into production as promptly as possible. Our investment in
infrastructure and new home construction allows us to offer an
attractive range and choice of homes to our customers to meet their
housing needs.
Our strategy recognises the potential for the Group to generate
surplus capital through strong operational delivery. The Board
therefore made a long term commitment in early 2012 to deliver
GBP1.9bn (GBP6.20 per share) of surplus capital to shareholders
over ten years to 2021 ("the Capital Return Plan"), which was
similar to the market capitalisation of the Group at the time.
The value of any surplus capital to be returned to shareholders
is continually assessed after due consideration of the appropriate
balance between the current financial position of the Group and its
reinvestment needs, the Group's land bank, the housing market cycle
and land market conditions, and wider-ranging risks and external
factors. The Board has set out its risk and viability assessment
processes in note 11 of this announcement.
Following Persimmon's strong performance over recent years the
Group is in an excellent financial position holding total liquid
cash resources of GBP1,048.1m, together with a high quality land
bank in each of its regional businesses. Having been appointed
Group Chief Executive today, Dave Jenkinson and the Board will
continue to assess the availability of surplus capital whilst
recognising the heightened risks regarding the future performance
of the UK economy resulting from the UK's exit from the EU. The
Board remains confident in Persimmon's financial strength and
ability to meet its schedule of committed capital return
payments.
Board Changes
The Board announced the departure of Jeff Fairburn, former CEO,
on 7 November 2018, effective from 31 December 2018. Dave
Jenkinson, Group Managing Director, was appointed Interim Group
Chief Executive from 1 January 2019. The Board would like to thank
Jeff for his long service to the Company and acknowledge his
contribution to the growth and financial success Persimmon achieved
under his leadership.
The search for a new Chief Executive has now concluded, with the
appointment of Dave Jenkinson as Group Chief Executive with
immediate effect, being announced separately today.
Employees
We recognise the importance of having a diverse and engaged
workforce. To enrich and strengthen this engagement, during 2018 we
put in place procedures for a new Employee Engagement Panel to
increase dialogue and provide valuable input and feedback to the
Board from a diverse group of employees from across the business.
The Panel will consider a wide spectrum of matters relating to the
business and provide feedback on their discussions. We have also
introduced a Gender Diversity Panel of some of our most senior
female employees. This Panel has set an initial goal of actively
promoting the benefits of working within the housebuilding industry
across the local communities we serve through direct engagement
with local schools and colleges during 2019.
In addition, from January 2019, following proactive engagement
with the Living Wage Foundation, we adopted the Living Wage
Foundation's payment criteria for our employees. Whilst the vast
majority of our employees were already paid above the Living Wage
we are pleased that, having taken this action, we are able to
demonstrate our commitment to being a responsible employer and
support our employees on this basis.
Customers and Community
We must place our customers at the heart of our business and
improving customer satisfaction levels is a key priority. We listen
to our customer's feedback and aim to act promptly to address any
concerns. We are continuing to invest in both the systems and the
processes that will enable us to improve our levels of service to
customers, whilst also investing in our site management personnel
and customer care teams so we can better meet our customers' needs.
Our Home Builders Federation star rating score was 79% for 2018,
which is in line with the prior year's three star rating, and just
below a four star rating which is achieved at an 80% score. We
recognise the Group has the opportunity to achieve an improved
performance and we are confident that the action we are taking will
sustain further improvements as these measures are rolled out
across the Group.
The introduction of our new FibreNest broadband service
demonstrates the Group's desire to serve its customers better by
ensuring they are connected to the internet continuously from
moving in day. We are pleased that it is rated highly by our
customers.
As a responsible, sustainable business we place great importance
on our relationships with the communities in which we operate. The
Group's approach to master-planning its developments is based on
working with local communities to create neighbourhoods that
enhance and support diverse sustainable living. The design of our
developments and our Group core house types are centred on meeting
the housing needs of the local communities we serve. In response to
customer feedback we concentrate on delivering traditional homes,
creating environments where local people wish to live. Investing in
improvements to local infrastructure, and improving local amenities
and public open space, allows us to support communities on a
sustainable basis.
During 2018 we contributed GBP474m to local communities in
affordable housing and planning contributions, which helped to
create over 2,400** new school places. We also supported over
50,000*** construction and supply chain jobs. Of the year's 16,449
new home legal completions, 3,108 new homes were delivered to our
Housing Association partners and 225 were sold as Discounted Open
Market Value sales.
During 2018 the Persimmon Charitable Foundation donated GBP1.3m
to c. 900 local charities, sporting and community groups through
our Community Champions and Healthy Community Campaigns, helping to
support community life. We recently launched a new campaign,
Building Futures, which will donate over GBP1m to support children
in health, sport, education and the arts. We are delighted to be
joining forces with Team GB - the British Olympic Association - to
help children throughout the UK. As an Official Partner of Team GB
we are proud to be supporting them in the run up to, and beyond,
the next Olympic Games in Tokyo.
Outlook
Recognising the current robust level of demand for our new
homes, as part of our drive to improve our service to customers we
have taken action in the new year to deliver greater accuracy of
anticipated moving in dates. We have adopted a more targeted
approach to the phasing of sales releases in 5 of our 31
businesses, where demand on certain sites is strong. In addition,
as indicated in our January trading update, we still have a dozen
new sales outlets where we are progressing build to a more advanced
stage before releasing to the market over the next few weeks which
will provide further sales opportunities. Whilst we do not expect
this will impact on the Group's completions for the year overall,
these measures have contributed to a slower pace of sales
reservations in the early weeks of the current spring trading
period. Overall sales remain in line with our expectations and we
are confident that these sites will make a good contribution to
sales once build has progressed.
Whilst sales expectations remain subject to a degree of
uncertainty at the start of any financial year, the lack of clarity
with respect to the UK's exit from the EU is currently creating
additional unpredictability. In this context and against record
sales in the same weeks last year, which reflected the stimulus
effect of the Government's cut in stamp duty for first time buyers
announced on 22 November 2017, and after recognising the above
actions to improve customer service, the Group's average private
sales rate per site in the first eight weeks of the year was 4%
lower than the previous year. We expect sales reservation volumes
will pick up on release of the plots and sites currently under
construction, delivering a different shape of sales for the current
year but with no impact on our overall completion expectations.
Cancellation rates remain at historically low levels. The Group's
current total forward sales, including legal completions taken so
far in 2019, remain strong at GBP2.02bn (2018: GBP2.03bn). The
average selling price of private sales within our total sales is
GBP238,800, c. 2% higher than at the same point last year, and
pricing conditions remain firm.
Given the Group's robust opening forward order position and
healthy outlet network Persimmon remains in a strong position in
its markets with attractively priced new homes in desirable
locations. We currently anticipate delivering a similar level of
legal completions during 2019 as in the prior year.
In line with our stated strategy of managing the business to
mitigate market cycle risks, over the last two years we have
adopted a very selective approach to land replacement. We have
concentrated on acquiring new land where anticipated development
returns and timeframes provide strong nearer term cash returns,
together with higher levels of protection to asset values. This, in
part, has been a key driver of the Group's superior margins over
the period. We continue to identify good quality land opportunities
in the open market and we will continue to reinvest in the business
for the future where the anticipated returns meet our expectations,
which will include our assessment of the current increased market
risk profile.
Growth in housing output from the industry continues to be
constrained by the tight availability of skilled trade resources
and some key materials. Persimmon will continue to invest to help
address these challenges. The Group's investment in its own brick
manufacturing plant at our Harworth manufacturing hub, near
Doncaster, provided increasing support to our build programmes
through 2018. We anticipate Brickworks will deliver c. 65m bricks
to Group companies through 2019. Additionally, the construction of
our own roof tile manufacturing plant on the same site is
progressing to plan and we expect first deliveries from Tileworks
to commence in the second half of this year. Our Space4
manufacturing facility, based near Birmingham, continues to make an
important contribution to our expanding in-house manufacturing
capability.
The Group will continue to invest in the training and
development of its employees with over 630 colleagues currently
engaged in structured training programmes, including 381
traditional apprentices learning the trade skills required to
support future housing delivery. We aim to deliver improvements in
customer care and levels of service through further investment in
our teams, processes and systems.
Persimmon's continued investment in our team's skills and
capabilities, both in our regional offices and across our national
site network, coupled with our off-site manufacturing initiatives,
are investments in the future strength of the business. Whilst the
benefits from these investments will take time to be realised we
believe they will continue to position Persimmon at the forefront
of the industry.
The UK economy displayed resilience through 2018 delivering
increased levels of employment, some real wage growth, and
continued support from a disciplined mortgage lending market, which
supported consumer confidence. Looking to the future, the Group is
in a strong financial position and is well positioned in its
markets with a high quality land bank and a very experienced
management team. The Board remains confident in the Group's future
progress.
On behalf of the Board I would like to thank management, all our
staff, our contractors and suppliers for all their dedication and
hard work in delivering the Group's excellent performance in
2018.
Roger Devlin
Group Chairman
25 February 2019
* 12 month rolling average and stated before goodwill impairment
** estimated using data from the National Audit Office
*** estimated using an economic toolkit
OPERATIONAL REVIEW
Persimmon made excellent progress in 2018, delivering
disciplined growth and strong performance across the business.
Growth
The Group delivered a 4% increase in new housing revenue in the
year to GBP3,545.8m, with growth in volume of 406 homes, or 3%, to
16,449 legal completions.
We have seen strong performances across each of our geographical
markets. Our optimal average weekly private sales rate for our
outlets is 0.75 of a private market sale per week through the year.
Whilst not quite achieving this optimal level of sales during 2018
we achieved c. 0.70 of a sale per week (2017: 0.72) reflecting the
resilient trading conditions seen in 2018.
We opened our thirty-first regional business, South Yorkshire,
on 2 January 2019 at Harworth near Doncaster. This business will
support the development of the Group's market share in the
Yorkshire region, where we currently operate from 40 outlets. Over
the last four years the Group has invested in an additional seven
new housebuilding businesses, reflecting Persimmon's commitment to
increasing the delivery of newly built homes on a sustainable
basis.
Across the UK, the Group opened c. 180 new sales outlets this
year (2017: c. 200 outlets). Our strong geographical footprint,
supported by our focused investment in attractive land in desirable
locations together with the skill and experience of our land,
design and planning teams, has helped us convert land into sales
outlets as quickly as possible given the challenges of the planning
system. At the end of the year, the Group had c. 360 outlets
managed by our 31 operating businesses. We believe disciplined high
quality growth is best delivered by maintaining a sustainable
market share in each of our regional markets and that this will
continue to deliver superior levels of free cash generation and
returns over the long term.
Our forward sales of GBP1,397.2m at 31 December 2018 were 3%
ahead of the prior year (2017: GBP1,356.1m) after second half legal
completion volumes of 8,377, which were 305 stronger than for the
first half of the year (H1: 8,072), an increase of 4%.
Investing in future growth
During 2018, the Group continued its strategy of investing in
high quality land in places where people wish to live and work.
Whilst there has been increased competition in some areas, the land
market remained favourable, offering good opportunities to invest
in the future of the business. The Group acquired 17,092 plots of
land in 84 locations across the UK, with 3,772 plots being
converted from our strategic land bank across 22 locations. This
focused investment in attractive land has enabled the Group to
expand its output by 75% over the last six years.
At 31 December 2018, the Group's land bank held c. 47,300 plots
of land with implementable planning permission (2017: c. 52,600
plots) and all of these sites are under development. We have a
further c. 28,500 plots of owned land (2017: c. 24,500) which are
currently proceeding towards achieving full planning consent. In
line with our strategic objectives, our land, planning and design
teams will remain focused on working with planning departments and
local communities to achieve implementable detailed consents as
quickly as possible to maintain a strong pipeline of developable
plots for our consented land bank over future years.
Increasing the resilience of our operations through vertical
integration
Securing the supply of key materials contributes to the Group's
greater resilience in supporting increasing levels of construction
and new home delivery.
The Group has invested in its own brick manufacturing facility
based at Harworth near Doncaster which has the capacity to
manufacture c. 80m bricks per annum. This secures the availability
and quality of supply for approximately two thirds of the Group's
brick requirements.
Similarly, the Group is currently constructing its own roof tile
manufacturing facility, based on the same site in Doncaster. We aim
to commence the supply of roof tiles to Group sites in the second
half of 2019. In addition, we have continued to invest in the
Group's Space4 timber frame construction technology which has
increased its production capacity by c. 19% to c. 9,500 units per
year, consisting of c. 7,750 timber frames and c. 1,750 'room in
the roof' systems.
Each of these projects will help the Group to increase certainty
of quality and supply of key materials and support improved
operating efficiencies.
Improving our customers' experience
Delivering a good quality product for our customers and
providing high levels of customer service throughout the home
buying process is a top priority for the business. For the year to
30 September 2018, the percentage of our customers who would
recommend Persimmon to a friend under the independent Home Builders
Federation (HBF) survey was 79%, in line with the prior year and
just short of the four star threshold of 80%. The Group has
continued to invest in its customer care systems and resources
during the year and this will continue to be the case in 2019 as we
remain determined to improve customer satisfaction levels.
FibreNest
In response to feedback from substantial numbers of customers
who were experiencing delays and poor performance from their
broadband service providers, we established FibreNest, our own
ultrafast, full fibre to the home, broadband service that aims to
ensure all our customers are connected to the internet from moving
in day onwards. The service has started very well and is highly
rated by our customers. FibreNest is currently ranked in the top
30% of internet service providers in the UK*.
The Group now has over 630 customers connected to the service on
over 35 sites. The Group intends to support new customers on future
sites as this service is rolled out further.
Strong returns and capital discipline
The Group's return on equity for 2018 of 27.7% (2017: 26.5%)
reflects continued disciplined working capital investment and
strong levels of post tax profit which increased by GBP99.5m (13%)
to GBP886.4m during 2018 (2017: GBP786.9m).
Persimmon's underlying return on average capital employed** for
2018 of 52.8% improved by 130 basis points from 51.5% in 2017. This
further improvement in return on capital was supported by the 9%
growth in underlying new housing operating margin*** to 30.8% (from
28.2% in 2017). The increase in underlying operating profit*** was
delivered from average capital employed that was 10% higher than
last year at GBP2.07bn.
With our focus on the cash intensity of the business, the Group
has continued to deliver strong liquidity. The Group's free cash
generation before capital returns of GBP732.3m was GBP477.7m or
GBP1.53 per share. Since the launch of the new strategy, the Group
has generated over GBP3.25bn, of free cash before capital
returns.
Capital return
A key feature of the Group's strategy launched in early 2012 is
to return capital that is considered to be surplus to the
reinvestment needs of the business, to shareholders through the
cycle. Our primary consideration in judging the level of surplus
capital available is the assessment as to whether the business is
operating at optimal scale in its regional markets, including
executing disciplined, well-judged land investment at the right
time through the cycle, whilst also minimising financial risk.
Total surplus capital of GBP7.20 per share, or GBP2.22 billion,
has now been paid to shareholders.
As explained in the Chairman's statement the Directors are
maintaining the existing schedule of capital returns. The Board is
pleased to announce the payment of 125 pence per share as an
interim dividend in respect of the financial year ended 31 December
2018 to be paid on 29 March to shareholders on the register on 8
March 2019. In addition, the Board is pleased to recommend to
shareholders the annual payment of 110 pence per share will be made
on 2 July 2019 as a final dividend with respect to the financial
year ended 31 December 2018 to shareholders on the register on 14
June 2019. The total value of the Capital Return Plan to 2021 is
now GBP13.00 per share compared to the GBP6.20 per share initial
commitment made by the Board in 2012.
The schedule of payments under the Capital Return Plan is as
follows:
Original Plan Existing Plan Original Plan Existing Plan
Pence Per Share Pence Per Share
28 June 2013 28 June 2013 75 paid 75 paid
--------------- ----------------- -----------------
4 July 2014 - 70 paid
--------------- ----------------- -----------------
30 June 2015 2 April 2015 95 paid 95 paid
--------------- ----------------- -----------------
1 April 2016 - 110 paid
--------------- ----------------- -----------------
31 March 2017 - 25 paid
--------------- ----------------- -----------------
30 June 2017 3 July 2017 110 paid 110 paid
--------------- ----------------- -----------------
29 March 2018 - 125 paid
2 July 2018 - 110 paid
--------------- ----------------- -----------------
30 June 2019 29 March 2019 - 125^
2 July 2019 110 110^
------------------------------- ----------------- -----------------
30 June 2020 2 April 2020 - 125^
6 July 2020 115 110^
------------------------------- ----------------- -----------------
30 June 2021 6 July 2021 115 110^
--------------- ----------------- -----------------
Total 620 1300
----------------- -----------------
^ Current anticipated profile of payments.
Over and above the Group's short term outperformance, the Board
has also assessed the longer term prospects of the Group and the
effectiveness of its strategy. The Board's conclusions are
explained within the Viability Statement in note 11 of this
announcement.
FINANCIAL REVIEW
Profitability
The Group's new housing revenue increased by GBP123.5m to
GBP3,545.8m from GBP3,422.3m in 2017 (see note 2 of this
announcement).
During the year, new housing gross margins increased to 33.3%
(2017: 31.3%). The combination of some modest improvement in
selling prices (the Group's average selling price increasing by c.
1% year on year) and further improvement in land and build recovery
rates as we have opened new developments through the year, have all
contributed to the improvement in the Group's new housing
margins.
The Group's lower land recovery rates compared to 2017 have
secured an additional 150 basis point contribution to the Group's
new housing gross margin year on year. For 2018, the value of the
Group's land recoveries totalled 14.6% of new housing revenue
(2017: 16.1% of housing revenue).
During 2018 the mix of our legal completions contained fewer
larger Charles Church homes and a greater proportion of smaller
Persimmon homes and homes sold to our Housing Association partners
by our Westbury Partnerships business (more detail on our brands'
performance is found in "Our Strategic Objectives at Work" section
later in this announcement). This has helped contribute to a
reduction in our build and direct costs which were 52.1% of new
housing revenue (2017: 52.6% of new housing revenue).
Underlying operating profits*** have increased to GBP1,091.9m
(2017: GBP966.1m), a 13% increase, with an underlying new housing
operating margin*** of 30.8% (2017: 28.2%). In line with our
expectations, margin progress was maintained with a second half
underlying housing operating margin*** of 31.8%, compared to a
first half margin of 29.7%.
Asset strength
The Group has a strong balance sheet with net assets of
GBP3,194.5m at 31 December 2018 (2017: GBP3,201.6m). Net assets per
share decreased by 3% compared with the prior year to 1,006.0 pence
(2017: 1,036.6 pence) following the return of GBP732.3m of surplus
capital to shareholders during the year. In line with the Board's
plans to optimise the level of cash held by the business over time
and through the cycle, cash balances held at the year end totalled
GBP1,048.1m (2017: GBP1,302.7m), a decrease of GBP254.6m.
At 31 December 2018 the carrying value of the Group's land
assets was GBP2,077.2m, GBP66.6m higher than the prior year (2017:
GBP2,010.6m). The Group owns 75,793 plots of which 47,305 have
detailed implementable planning consents. A further 23,295 plots
are under the Group's control, being plots where we have exchanged
contracts to buy but where the contract remains to be completed due
to outstanding conditions remaining unfulfilled. Our total owned
and under control land bank provides 6 years of forward supply at
2018 volumes. During the year, 17,092 plots were added to our land
bank. Continued conversion of land from our strategic land
portfolio together with excellent value on-market acquisitions have
maintained the Group's high quality consented land bank.
Our work in progress carrying value at 31 December 2018 of
GBP881.8m was GBP157.9m higher than the prior year (2017:
GBP723.9m). Whilst the Group's construction activity was delayed
due to the poor weather in late February/early March 2018, we took
advantage of the good summer weather to push forward with our build
programmes. As a result, the Group is carrying a larger volume of
plot foundations and infrastructure works on a number of sites such
as Germany Beck, just south of York (a scheme for c. 630 homes) and
Hampton Gardens in Peterborough (a development of c. 860 new homes)
into 2019, providing a strong platform for build to progress in the
first half of 2019.
By the end of the year the Group's work in progress investment
represented 24.9% of 2018 housing sales, providing a stronger
platform for future sales and product availability.
The Board reviewed the net realisable value of land and work in
progress at 31 December 2018 using consistent principles to prior
years and concluded that the carrying value was appropriate. At the
year end the Group retained an impairment provision of GBP37.8m
(2017: GBP41.9m).
The Group's total retained profits after tax for the year of
GBP886.4m were 13% higher than last year (2017: GBP786.9m). The
Group's retained earnings were added to by an after tax
remeasurement gain of GBP16.4m associated with the Group's pension
scheme asset of GBP90.6m. The net settlement of share options
exercised in 2018 resulted in a GBP180.2m decrease in the Group's
retained earnings.
Cash generation, net finance income and financial assets
Cash balances at 31 December 2018 totalled GBP1,048.1m (2017:
GBP1,302.7m). The Group's cash generation remains healthy,
GBP1,082.8m of cash was generated (2017: GBP1,382.6m) before the
Capital Return Payment (GBP732.3m) and before net land spend
(GBP605.1m). Indeed, recognising the payments of GBP206.6m made to
HMRC in 2018 in respect of share options exercised during the year,
gross cash generation for 2018 was GBP1,289.4m (2017: GBP1,382.6m).
Judging the sale and timing of capital deployment through the cycle
remains a strategic priority. At the year end, the Group's deferred
land creditor obligations were GBP548.0m (2017: GBP567.3m). Cash
inflow from operations, totalled GBP818.2m in 2018 (2017:
GBP977.4m).
As a consequence of strong cash inflows from redemptions, the
carrying value of the Group's outstanding shared equity loans,
reported as "Shared equity loan receivables", has reduced during
the year by GBP30.4m to GBP86.9m (2017: GBP117.3m). The Board has
reviewed the carrying value of these receivables and has concluded
that the value is appropriate.
Net finance income for the year was GBP8.1m (2017: GBP11.0m).
Incorporated within this is GBP11.2m of gains generated on the
Group's shared equity loan receivables (2017: GBP15.2m) and GBP9.3m
of imputed interest payable on land creditors (2017: GBP10.2m).
Impact of the UK leaving the EU
Although currently there is increased economic and political
uncertainty associated with the process of the UK's departure from
the EU, market fundamentals remain supportive. Employment levels
remain positive, interest rates continue at lower levels and
mortgage lenders are keen to support customers with competitive
mortgage products. The Group is in a strong position in its markets
with a good range and choice of homes at lower price points across
our national sales network. The Group has a very strong balance
sheet with a high quality land bank, robust liquidity, substantial
cash holdings and a strong forward order book. We have reviewed all
the constituent elements of our construction costs together with
the Group's supply chain. We have worked with our suppliers to
identify any material supplies which may be exposed to some
disruption to availability as a result of Brexit and we are working
with them to adopt appropriate mitigating measures (see further
detail in "Securing quality and availability of materials" in the
"Our Strategic Objectives at Work" section of this
announcement).
The risks associated with the impact of the UK's departure from
the EU are included in the Board's assessment of principal risks
and viability set out in note 11 of this announcement.
Shareholders' equity, treasury policy and related risks
The Board remains focused on returning surplus capital to
shareholders to maintain an efficient capital structure whilst
minimising financial risk through the economic cycle. The Group's
Capital Return Plan schedule explained earlier in this report is
continually assessed by the Directors.
The Group maintains a GBP300m Revolving Credit Facility with its
five relationship banks. During the year the Group extended the
maturity of the revolving credit facility to 31 March 2023.
We retain a focus on maintaining strong liquidity. The Group's
revolving credit facilities will only be used to support short term
seasonal working capital needs of the business. Delivery of the
Group's strategic objectives will be supported by a combination of
careful management of the working capital needs of the business,
the generation of annual after tax earnings and the management of
the Group's equity, debt and cash management facilities. This
approach will mitigate the financial risks the Group faces which
include credit risk, liquidity risk, interest rate volatility and
debt capital market pricing risk.
Current trading outlook
Despite the current increased uncertainties regarding the future
performance of the UK economy, customer activity levels have proved
resilient with good levels of customers visiting our sites over the
first eight weeks of the year. The housing market continues to
benefit from higher levels of employment and resilient consumer
confidence supported by lower levels of interest rates and a
competitive mortgage market. The continuation of disciplined
lending practices with active oversight and guidance by the
Financial Policy Committee will help maintain greater
sustainability of the market.
We believe market fundamentals remain strong based upon a long
term unfulfilled level of demand. Our commitment to helping solve
these difficulties is demonstrated by our continued focus on
delivering growth in our output. The Group has increased its legal
completions by over 75% since 2012, and has invested over GBP3.81bn
in land over the same period to help bring as many new developments
forward as possible. We support the government's initiatives to
assist the increase in output from the industry towards its goal of
reaching 300,000 new homes built each year, across multiple
tenures, by the mid-2020's. We remain keen to contribute to this
increase in new home delivery and the Group is well positioned in
its local markets with its attractively designed core house types,
offering homes at more affordable prices on developments that
concentrate on providing a good range and choice to all customers
with an emphasis on first time buyers and first time movers.
As a result of the Group's strong levels of sales reservations
through the autumn of last year, together with solid sales in the
early weeks of 2019, the Group has a strong forward sales position
(including legal completions taken to date in 2019) of GBP2.02bn.
Whilst our average private owner occupier market sales rate per
site in the first eight weeks of the year was 4% lower than the
previous year, our later release of plots for sale on certain
active sites together with the later release of a dozen sites for
sale over the next few weeks provide the Group with the opportunity
to build on this strong forward sold position, together with an
improved ability to ensure we deliver the new homes reserved by our
customers to more accurate move in dates.
The Group has c. 4,800 new homes forward sold to its housing
association partners, 9% stronger than at the same point last year.
Our Westbury Partnerships business expects to continue to offer the
opportunity to acquire good volumes of new homes to its housing
association partners, given the Group's strong investment in new
land and external infrastructure works, which is enabling
substantial new developments to be brought forward. Sites at Eve
Parc in Cornwall for 300 new homes and at Mascall's Grange in Kent
for 291 homes are good examples of developments which have
substantial affordable housing allocations (100 and 105 affordable
homes respectively) which will support the diversity and
sustainability of these communities in the future as their housing
needs are addressed.
We recognise that transaction volumes in the second hand housing
market have been subdued for some time and we continue to offer our
part exchange and home change facilities to support existing home
owners' desire to purchase a newly built home from the Group. Our
part exchange facilities were utilised by 10% of our private sale
customers in 2018. We anticipate that more new home buyers may seek
to take advantage of these opportunities as we progress through the
current year, using our resale support to enable them to purchase
new homes from the Group in locations in which they wish to
live.
During the current year we will continue to invest in the future
growth of the business to meet market demand, retaining flexibility
to react to changing conditions as market events unfold. The
Group's strong financial position provides a great platform to
support this sustainable growth. However, we will remain vigilant
to changing conditions in the sales and land markets to ensure we
continue to judge our land replacement activity appropriately,
recognising that the negotiations associated with the UK's exit
from the EU present key uncertainties that may have a significant
influence on market outcomes. The Group will continue to work
tirelessly in partnership with local planning authorities to try
and bring forward the Group's strategic land for inclusion in their
local housing plans, which are required to meet their communities'
housing needs over the next five years in line with the National
Planning Policy Framework.
The Board recognises that the excellent performance of the
business in 2018 results from the dedication and hard work of the
whole Persimmon team. The team will continue to strive for further
improvements in its operational performance in pursuit of
fulfilling the Group's strategic objectives. We remain confident
that the Persimmon team have the skills, imagination and drive to
continue to successfully develop the business and we thank all our
employees and supply chain partners for their continued
contribution to the success of the Group.
* Ranked by Trustpilot
** 12 month rolling average and stated before goodwill impairment
*** Stated before goodwill impairment of GBP9.2m (2017: GBP11.0m)
A STRATEGY THAT DELIVERS SUSTAINABLE VALUE
Our Strategic Objectives
Our strategic objectives reflect our focus on the basics of good
housebuilding, investing in a skilled and diverse workforce,
acquiring land in sustainable locations and building good quality
affordable family homes for our customers. This creates attractive
neighbourhoods for our local communities and sustainable levels of
value through the housing cycle for our shareholders.
1. Building quality homes for our customers
-- Provide a range and choice of homes at attractive prices which satisfy local communities'
housing needs
-- Support first time buyers to participate in the market place
-- Build quality homes in places where people want to live and work across the UK, to meet market
demand
-- Aim to provide high levels of customer service throughout the home buying process
-- Deliver new homes tailored to our Housing Association partners' clients needs
2. Supporting sustainable communities
-- Create attractive neighbourhoods with high amenity value
-- Invest in local infrastructure to improve community environments
-- Design our developments to reflect communities' needs through active engagement with all stakeholders
during the planning and development process
-- Deliver housing that fulfils occupier requirements across multiple tenures
-- Build safely and responsibly
-- Minimise our environmental impact
3. Maintaining a diverse skilled workforce
-- Invest in our people and their skills development, ensuring talent is recognised, nurtured
and supported
-- Maintain a close-knit, entrepreneurial and meritocratic culture where hard work is valued
-- Maintain excellent health and safety standards
-- Increase diversity in our workforce to enrich our culture and grow our talent and skill base
4. Providing a sustainable supply of high quality land
-- Identify and fulfil the needs of local communities through our land acquisition and planning
processes
-- Through well-judged land replacement, deliver a sustainable supply of high quality land to
meet market demand
-- Delver our strategic land holdings for development
-- Maintain a high quality consented land bank
5. Securing quality and availability of materials
-- Support a secure and collaborative supply chain for the long term
-- Continue to strengthen our off-site manufacturing capabilities, including our Space4 modern
method of construction; Brickworks, our brick manufacturing facility; and Tileworks, our roof
tile manufacturing plant, which is under construction
6. Optimising working capital and returns
-- Invest in working capital to meet market demand
-- Maintain discipline over the level of capital employed within the business through the cycle
-- Create greater certainty for shareholders regarding the timing and value of returns
-- Identify capital that is surplus to the operational needs of the business and distribute to
shareholders
OUR STRATEGIC OBJECTIVES AT WORK
The Group places its customers at the centre of our business. We
believe that the Group's strength is generated from our approach to
achieving each of our six strategic objectives. Persimmon
differentiates itself by developing highly skilled land, planning
and design teams that support the acquisition of sites in great
locations where our customers wish to live and work. The Group
generates further value for its customers and other stakeholders by
master-planning desirable neighbourhoods using our attractively
designed core house types that prioritise higher levels of customer
satisfaction whilst seeking to reduce complexity as an aid to
achieving greater site productivity and efficiency.
1. Building Quality Homes for Our Customers
Our brands - providing the range, choice and affordability of
homes
The Group's strategic objective to provide a range of desirable
homes at affordable prices for our customers is supported by the
Group's three distinctive brands, Persimmon, Charles Church and
Westbury Partnerships. The Group seeks to deliver new homes across
multiple tenures with the needs of our customers (particularly the
first time buyer and first time mover segments of the market) at
the forefront of our development plans. In addition to developing
single branded sites, the Group also benefits from providing
multiple brands on some of our larger sites such as Edmund Park in
Frome (a scheme for c. 450 new homes) and Buttercup Leys in Boulton
Moor, south of Derby (a development of c. 500 new homes). This
creates the opportunity for the Group to secure the benefits of
more efficient site operations, resulting in performance
improvements being captured across the business from continuity of
build programmes, site resourcing and customer care performance
through to health and safety compliance. By attracting a wider
range of the home buying public through the multiple branding of
sites the Group is able to optimise sales rates and achieve a
swifter asset turn.
Our brands' performance
Persimmon
The Persimmon brand delivers traditional family housing to the
private owner occupier market. In the year under review Persimmon
delivered 11,947 new homes, 458 (or 4%) more than 2017,
representing another strong year of growth.
This year on year growth in the number of homes sold has driven
a GBP211.1m increase in total revenues to GBP2,685.1m. The brand's
long term growth reflects the business' ability to meet market
demand by fulfilling the needs of our customers at affordable
prices.
Persimmon's highest volumes were generated in our Shires and
Midlands regional markets which legally completed 1,834 and 1,830
new homes respectively.
The Persimmon brand's average selling price of GBP224,749 (2017:
GBP215,336), which is slightly lower than the average UK house
price in December 2018 of GBP230,776*, reflects the Group's ongoing
commitment to delivering good quality housing at affordable
prices.
Our Persimmon southern regional markets secured 44% of the
brand's legal completions (5,230 homes), growing by 8% compared
with 2017. Persimmon's sales in these southern markets generated
51% of the brand's revenues with an average selling price for the
year of GBP260,074 (2017: GBP250,228).
In our Western region, sites at Weston Super Mare, Oakwood View,
and at Bridgwater, Kings Copse, contributed excellent volumes
during the year. Both sites benefit from being in convenient
locations offering easier access for commuting and excellent local
amenities. As such, the developments have been very attractive to
customers in that area and the use of the Group's core house types,
our Space4 modern method of construction techniques and our
detailed management of construction programmes meant that efficient
build rates were achieved to meet customer demand.
Persimmon's highest average selling price of GBP305,197 (2017:
GBP287,713) was in our Southern region with higher value sites at
Urban Central in Grays, Essex and Hatchwood Mill in Winnersh in
Berkshire.
The lowest average selling price for the brand of GBP176,802
(2017: GBP173,786) was in the Wales regional market where sites at
Oakwood View and Dol Yr Ysgol, both near Bridgend in mid Glamorgan,
generated high volumes of new homes to our customers at lower price
points.
Our focus on expanding our geographical footprint has resulted
in the creation of seven new businesses over the last four years.
Recognising that our new South Yorkshire business was only opened
on 2 January 2019, the remaining six new businesses generated 17%
of Persimmon's legal completions and housing revenue in 2018. Our
new operating business based near Ipswich in Suffolk opened at the
start of 2018 and made a strong start delivering 348 new homes in
2018, including 224 Persimmon homes, 23 Charles Church homes and
101 Westbury Partnership homes.
Charles Church
The Charles Church brand both complements and differentiates
itself from Persimmon by offering the customer a choice of
executive housing in premium locations across the UK, with larger
house types with increased specification. With this market
positioning Charles Church has retained its focus on delivering
higher value new homes with 61 active sales outlets at the end of
2018 (2017: 74 outlets). Charles Church generated revenues of
GBP495.1m in 2018 (2017: GBP626.9m) from 1,394 legal completions
(2017: 1,785).
The Charles Church average selling price increased 1% to
GBP355,133 (2017: GBP351,218), with 59% (2017: 57%) of its sales
being completed in southern markets. For example, strong demand and
pricing were experienced at Wyvern Farm, Stanway in Essex and The
Croft, Burgess Hill, West Sussex. Both sites benefit from a range
of homes in excellent locations with good local amenities and
excellent schools.
Westbury Partnerships
Westbury Partnerships is our brand delivering affordable social
housing. Westbury Partnerships plays a key part in the delivery of
new homes for the benefit of lower income occupiers, offering
solutions to some of the country's affordable housing problems.
The brand delivered 3,108 new homes to our housing association
partners during 2018, an increase of 12% when compared to the
previous year (2017: 2,769). In total, Westbury Partnership volumes
represented 19% of the Group's legal completions during 2018 (2017:
17%). The average selling price for these homes increased by 1% to
GBP117,653 (2017: GBP116,068).
The Group delivered 58% of Westbury Partnerships' new homes in
our southern regional market (2017: 62%).
We are keen to continue delivering affordable housing in
increasing numbers to all our housing association partners across
the whole of the UK. The Group will seek to further develop these
strong relationships in order to support as many lower income
families as possible to access the housing market in line with the
aims of the National Planning Policy Framework. The Group currently
has c. 4,800 affordable housing units forward sold in our order
book (2017: 4,420).
The Group is focused on providing affordable housing to all of
our customers. To further support this objective, Westbury
Partnerships works closely with Homes England and the Housing
Agencies in Scotland and Wales to manage our relationships in
association with the Help to Buy: Equity Loan scheme in England and
the similar schemes in Scotland and Wales. These schemes provide
customers with greater access to the housing market as it enables
them to buy a home with a lower deposit and at lower interest rates
than many other mortgage options. During 2018, the Group delivered
7,970 (2017: 7,682) new homes to customers who elected to use the
Government sponsored Help to Buy: Equity Loan scheme.
Building good quality homes
The Group's core house types, modern methods of construction and
high quality supplies are important elements in supporting our aim
of delivering consistent build quality across all our developments.
Our build programmes include detailed quality checks at each stage
of the build process from foundations and slab inspections to
pre-plaster and pre-paint inspections. All of our homes are sold
with a 10-year warranty backed by either the National House
Building Council (NHBC), Local Authority Building Control (LABC) or
Premier Guarantee and, in addition to our inspections, each
warranty provider conducts their own independent checks at critical
build stages. In addition, senior employees at each operating
business conduct quality inspections on a proportion of our
finished homes. This careful, detailed build process is designed to
deliver consistently good quality homes for our customers across
the UK. We support the further improvements being developed by the
All Party Parliamentary Group with respect to the new homes market
and we will continue to contribute to the work of the Home Builders
Federation (HBF) in supporting these measures.
Customer service
We understand the importance of delivering high levels of
service to our customers. We participate in a National New Homes
Survey, run by the HBF, which awards homebuilders stars for
customer satisfaction. The survey year covers the period from 1
October to 30 September and the rating system is based on the
number of customers who would recommend their builder to a friend.
Our 2018 rating from the HBF is 79%, just below a four star rating
(the threshold for which is 80%). This rating, whilst in line with
last year remains a key focus for us, with an improvement in our
customers' experience being a key objective for the Group in 2019
and beyond.
Our customers tell us that good communication throughout the
home buying process is very important, particularly regarding the
crucial "move in" date. In 2018, we continued to focus on improving
the systems and processes in place for communicating with our
customers. These improvements ensure our customers are kept
informed at all key stages, including finalising their moving in
date.
We appreciate that despite our best efforts, there will be some
occasions when customers experience an issue with their new home.
We listen to our customers and act as promptly as possible to deal
with any concerns. We have substantially increased the level of
resources and skills in our customer care departments in order to
improve the speed and efficiency with which we deal with our
customers' issues. Our customer care operatives have received
additional site based training that aims to reduce the time taken
to rectify any points raised. Whilst we have seen some success in
this area we continue to aim for further improvement. Since 2014,
while the number of homes the Group has delivered to its customers
has increased by 22%, the level of our on-site resource has
increased by 66% and the resource in our customer care departments
has increased by 93%.
In response to feedback from customers we have increased the
flexibility of the working hours of our office based customer care
staff. Our customers are now able to contact a customer care team
member outside of normal working hours, at times more convenient to
them. In addition, from the beginning of 2019 our site based
customer care operatives are available out of hours, including
Saturday mornings, to attend appointment times which are more
convenient for our customers.
A key objective for 2019 is to continue to deliver tangible
improvements in the level of customer satisfaction. We will focus
on providing site staff induction training to cover all customer
care processes, make significant investment in technology that will
improve communication between our regional offices, our customer
care departments and our customers, and we will continue to offer a
more flexible and convenient service to our customers.
We believe that this continued investment in our customer care
resources will improve service between the notification of an issue
and its resolution, provide an enhanced customer experience and
ensure we achieve progress in our customer satisfaction levels.
Customer care performance will continue to be included in bonus
and incentive criteria for our senior operational management,
aligning their interests with this priority for the Group.
FibreNest
Having listened to our customers, we understand that they have
been increasingly frustrated with delays to their broadband
connection by existing suppliers. In addition, the speeds available
from these services can be disappointing at times. We recognise
that a reliable broadband connection is considered to be the
"Fourth utility" for a large number of our customers. For this
reason, we have established FibreNest, our own ultrafast, full
fibre to the home, broadband service which aims to be available to
our customers from moving in day.
Working with experienced partners, FibreNest provides ultrafast
speeds coupled with excellent levels of service, both during
installation and for the duration of the service, through a
UK-based call centre and utilisation of highly experienced
engineers. The first customers were connected in August 2018 and
the service has been introduced across more than 35 sites with
further roll outs planned. The FibreNest service is highly rated by
our customers and FibreNest is currently ranked in the top 30%** of
internet service providers in the UK.
2. Supporting Sustainable Communities
We create attractive neighbourhoods for our customers, with good
infrastructure and access to local amenities. We engage with local
communities and work closely with planning authorities to deliver
much needed affordable and private market housing to ensure we
develop successful and sustainable neighbourhoods that effectively
integrate within existing communities.
Our land acquisition process aims to acquire sites in attractive
locations where demand for homes is high. The Group has invested in
highly skilled land, planning and design teams who have the
knowledge and experience to deliver sites which provide the range,
choice and affordability of homes that our customers require. In
addition, our teams assess how we can mitigate our impact on
existing communities and enhance local facilities providing
investment in local infrastructure such as transport, education,
retail and recreation facilities.
All of our developments are designed to promote social
inclusion, incorporating housing for families with a broad span of
incomes. In 2018, we provided 3,108 homes, or GBP366m of housing,
to housing associations and a further 225 homes, or GBP28m of
housing, to qualifying customers using affordable Discounted Open
Market Value Housing. This is housing that is sold at a discount of
around 20-30% to the local market value with the discount remaining
with the property in perpetuity. These homes can only be purchased
by customers who meet eligibility criteria set by local councils.
Overall, we provided GBP394m of affordable housing for lower income
families in 2018 (2017: GBP348m).
Engaging with Our Communities
We have 31 regional teams with detailed knowledge of the local
communities in which they operate. In addition to fulfilling the
housing needs of our customers by delivering newly built homes to
their local market, our teams seek to support their local
communities in a variety of ways:
-- By consultation throughout the planning and development process
-- By employing local tradespeople
-- By engaging with local suppliers
-- Through charitable donations to support local good cause
-- Through engagement with local schools
-- By delivering new amenities
-- By delivering improvements to local infrastructure
The Group strives to deliver excellence in planning and our
sensitivity in understanding the impact our developments have on
wider society ensures that our developments are fully integrated
into existing infrastructure as well as delivering improvements
that benefit existing residents. Under the planning process, we
invest in local communities in many forms, such as parks and open
space; education provision; community buildings and roads and other
infrastructure, either through direct construction or through
financial contributions to local authorities. During 2018 we
contributed over GBP80m to local communities (2017: GBP64m) through
planning contributions to local authorities. Of the money
contributed, GBP31.2m related to education provision.
The Persimmon Charitable Foundation
The Persimmon Charitable Foundation made c. 900 donations,
amounting to GBP1.3m, to local charities, community groups and good
causes and to local sporting organisations, in 2018. The Foundation
ran two campaigns during the year, our successful Community
Champions campaign, aimed at local charity and community groups,
and our Healthy Communities campaign, aimed at supporting local
clubs offering sporting facilities for children and young people.
Organisations can apply for funding online at
www.persimmonhomes.com/charity.
The Community Champions campaign was launched in 2015 and
provides funding to local community groups and charities operating
in the areas in which we build across the UK. Each of our 31
operating businesses and our head office make donations of up to
GBP1,000 every month to each of two local good causes, to match the
organisations own fund raising efforts. During 2018, Community
Champions donated c. GBP770,000 to c. 800 local groups.
The Foundation's Healthy Communities initiative concluded in
2018 and over the course of a year has donated more than GBP600,000
to support amateur sports clubs, teams and individuals aged 21 and
under in England, Wales and Scotland. This initiative encouraged
local sports teams to apply for a donation from the Foundation.
Almost 200 sporting organisations or individuals received a
donation of GBP750 for sporting equipment and kit.
In January 2018, the trustees of the Foundation, together with
an independent leading fund raiser, picked 30 finalists from all of
the applications received to be put forward to a public vote, with
the winner receiving a GBP200,000 donation and two runners up
receiving GBP50,000 each. The other finalists received a donation
of GBP5,000 each. In determining the finalists, the panel were
looking to reward those who came up with the most innovative and
compelling ideas as to how they would use the prize money to
benefit young people in sport.
The Healthy Communities winners were announced at a gala dinner
held in March 2018, to which representatives of each of the
finalists were invited. The dinner was generously supported by a
number of the Group's major suppliers and the evening itself raised
GBP13,000 for the Charitable Foundation's funds.
The Heart of England Boxing Club was the eventual winner. This
Leicestershire club helps young people overcome issues such as
ADHD, autism, anti-social behaviour and bullying, and received a
cheque from the Persimmon Charitable Foundation for GBP200,000.
SportsAble in Maidenhead and Park Wrekin Gymnastics Club in
Shropshire each received a donation of GBP50,000 as runners up.
Following the success of Healthy Communities, in January 2019 we
launched a new initiative, Building Futures, which aims to donate
over GBP1 million to support children across the UK. We are joining
forces with Team GB - the Great Britain and Northern Ireland
Olympic Team run by the British Olympic Association - to help
organisations that support children across England, Wales and
Scotland. Building Futures is solely for children under the age of
18. We will be aiming to make donations in three areas; amateur
sport, health (physical and mental) and Arts and Education (schools
and clubs outside of schools).
As an official partner of Team GB, we are extremely proud to be
supporting the organisation in the run up to, and beyond, the next
Olympic Games in Tokyo.
Building safely and responsibly
Building safely and responsibly remains a key focus for the
Group. Maintaining excellent health and safety standards and
ensuring the wellbeing, health and safety of our employees,
workforce and customers is of paramount importance to us. The Group
is committed to being proactive in striving to reduce the health
and safety risks associated with all the work activities the Group
undertakes.
The Board ensures that the investment in Group Health and Safety
resources devoted to ensuring our development sites, manufacturing
plants and offices remain safe and healthy environments, is
appropriate to support Operational Management at Group, Regional
and Operating Business level. The Health and Safety team under the
direction of our senior management team has considerable experience
in providing both a pro-active advisory, and reactive incident led,
approach to identify and mitigate health and safety risk.
Pre-start and ongoing planning of construction activities as our
sites progress is undertaken by our management as they strive to
maintain high levels of health and safety performance. The Group
provides extensive training to safeguard the wellbeing of all
people who come onto our sites, manufacturing plants or into our
offices including construction and sales staff, customers and the
local communities surrounding our sites.
In addition to the training and planning that is undertaken,
both our Group Health and Safety Department and our operational
management teams carry out regular monitoring and review of all our
work activities to maintain the required standards detailed in the
Group Health and Safety Policy. In 2018, the Group Health and
Safety department undertook 5,971 pro-active site inspections
(2017: 5,776).
During 2018 we reported 45 construction work related incidents
in our housebuilding operations to the Health and Safety Executive
under the Reporting of Incidents, Diseases and Dangerous
Occurrences Regulations (RIDDOR). This was four less than the
previous year (2017: 49) and with a further increase in production
the level of build per RIDDOR improved to 365 legal completions per
RIDDOR (2017: 330). The RIDDORs per thousand workers also improved
compared to last year at 3.22 accidents per thousand workers (2017:
3.62). In our manufacturing operations we reported 3 RIDDORs in
2018 (2017: 3).
Minimising our environmental impact
The Group is committed to managing the direct and indirect
impacts on the environment of both the new homes we build and our
ongoing business operations.
The Group identifies all major environmental risks it faces in
both the short and long term and our development processes include
appropriate management actions that will mitigate these risks.
Addressing these issues at the start of our development plans
ensures our environmental performance remains robust and helps the
Group secure more sustainable business processes.
The environmental impact of our homes
We believe that the most important indirect environmental impact
of our development activities is the ongoing impact of our new
homes. The Group's focus is therefore on building new homes to high
sustainability standards harnessing the benefits of good design and
improvements in materials and building techniques to deliver new
homes with high sustainable qualities.
Fabric first approach
All of our homes are designed to have good levels of energy
efficiency. We harness the benefits of good design and improvements
in materials and building techniques, to build homes to high
sustainability standards. The average Standard Assessment Procedure
(SAP) rating of our new homes is 83, which is around 40% more
energy efficient than the existing housing stock, which has an
average SAP rating of around 60. The use of Space4's timber frame
build system is one way we help to ensure high levels of insulation
and air tightness resulting in the homes built requiring less
heating while also improving heat retention.
The environmental impact of our operations
We monitor our own operational efficiency and direct
environmental impact in a number of ways including measuring our
greenhouse gas emissions (CO(2) e) and the amount of waste that we
generate and recycle for each home we build.
Greenhouse Gas Emissions^
tonnes CO(2) e
2018 2017 (restated)^^
Scope 1 emissions from gas, transport and construction site fuel use 35,450 30,050
------- ------------------
Scope 2 emissions from electricity use 2,950 3,470
------- ------------------
Total greenhouse gas emissions 38,400 33,520
------- ------------------
Greenhouse gas emissions per home sold 2.33 2.09
------- ------------------
^To calculate our greenhouse gas emissions we collate data from
across the Group and from our suppliers to identify the amount of
energy used in our operations. Greenhouse gas (GHG) emissions are
reported in line with the UK Government's Environmental Reporting
Guidelines, including mandatory GHG reporting guidance (June 2013),
and have been calculated using the GHG factors outlined in the BEIS
2018 Government GHG Conversion Factors for Company Reporting (July
2018).
^^During 2017, the Group brought in house some direct
groundworks operations, in order to provide improved control over
our build processes and programmes with associated efficiency
gains. The 2017 greenhouse gas emissions data has therefore been
updated to include these business operations for the full year in
order to provide a more appropriate comparator.
As noted within our Financial Review, the Group took advantage
of the good summer weather to advance our build programmes,
resulting in larger volumes of plot foundations and infrastructure
works being carried out on a number of sites to provide a strong
basis for build to progress in the first half of 2019. This earlier
investment is the main reason for the Group's increase in
greenhouse gas emissions in 2018 compared to the prior year.
The Group remains focused on reducing our greenhouse gas
emissions, on a like for like basis. We have implemented a range of
initiatives, embracing both our operations and procurement
practices, to improve the Group's environmental impact. This has
included securing faster connection of new homes to the National
Grid, thereby reducing the need for diesel to power on-site
generators, and the replacement of older plant and equipment with
newer, more fuel-efficient alternatives.
We have again participated in the CDP climate survey, alongside
many of the world's largest companies. To do this, we supply
information on climate risks and our low carbon opportunities. Our
participation demonstrates the importance we attach to the
challenges posed by climate change and how we are addressing these
issues, both at a strategic and operational level. We maintained
our rating for 2018 at C (Awareness). For 2019, we aim to
externally verify our greenhouse gas emissions data which may help
us to identify further areas where we can reduce our greenhouse gas
emissions and improve our rating in the CDP survey.
Brickworks
The Group's Brickworks facility, manufacturing concrete bricks,
is now fully operational. The Group's use of concrete bricks on its
developments has increased over recent years. Concrete bricks are
easier to make and their manufacture and use generate significant
savings in greenhouse gas emissions when compared to the production
of clay bricks using natural gas fired kilns. Each tonne of
concrete bricks produces 100 kg of CO(2) e less than the same
quantity of clay bricks during the manufacturing process.
Additionally, concrete is an absorber of carbon dioxide and these
bricks are fully recyclable.
Waste generated
During 2018 the percentage of waste we recycled increased to 96%
(2017: 92%) and the amount of waste per home built decreased to
6.73 tonnes (2017: 7.25 tonnes). One of the reasons we have
recycled more of our waste is due to the increased re-use of brick
and block waste on site. This brick and block waste is crushed for
re-use on site, for example in piling platforms and scaffold bases,
which not only reduces the amount of waste we send to landfill, but
also reduces our requirement for third party aggregates. We have
identified a number of operational areas where we can seek to drive
improvements in the amounts of waste produced and reduce the cost
of disposal. For example, we require our operating businesses to
improve the segregation of waste on our sites in order that we have
a better understanding of the type of waste we are producing so
that it is more efficiently controlled. Our operating businesses
are also using smaller skips and are now producing league tables
for skip usage on sites in their region.
Climate Change
The potential impacts of climate change and how best to address
them are systematically considered during the planning, development
and building process of each of our sites. We take the effects of
climate change very seriously when developing our sites. The Group
conducts full environmental assessments for each parcel of land we
acquire for development to ensure our activities fulfil all
obligations, respecting the natural environment and the communities
for which we are delivering newly built homes. Our development
master plans seek to maintain green spaces as a key element
supporting the health and wellbeing of local communities. In 2018
we incorporated over 300*** hectares of public open space and
gardens in our developments. The Group works closely with planning
authorities and other statutory bodies to identify and implement
the most effective counter-measures that mitigate the effects
climate change may have on our operations. For example, around
three quarters of our current developments incorporate Sustainable
Urban Drainage Systems to address the risks of flooding caused by
changes in weather patterns. During 2018, the Board reviewed its
principal risks and included climate change as a principal
risk.
Further information can be found on our policies, including our
Environment Policy, Waste and Resource Management Policy and
Climate Change Position Statement which are available on our
corporate website at www.persimmonhomes.com/corporate.
3. Maintaining a diverse skilled workforce
A large part of the success of our business is due to the energy
and commitment of our workforce at all levels. The Group has a
close knit, entrepreneurial and meritocratic culture where we
strive for excellence. Our people are encouraged to contribute new
ideas in an open environment to enhance the Group's processes. The
Group recognises the importance of having a diverse, skilled and
engaged workforce to ensure we have access to the talent we need.
The Group's average number of employees increased by 6% in 2018 to
over 4,800. We are proud that Persimmon has a long history of
promoting from within the business. Our growth provides
opportunities for our employees to develop rewarding careers with
us.
Training
Due to the growth in the housebuilding industry over recent
years, the labour market for housebuilding skills remains
constrained. To address this and to provide opportunities to
develop good careers in the Group we continue to invest in training
to build the skills base of our workforce. This involves a large
programme of graduate, trainee and apprentice recruitment and
training.
In 2018, the Group provided c. 11,000 training days (excluding
apprenticeships) to our employees and construction workforce (2017:
c. 10,600). In addition, we currently have 381 traditional
apprentices training within the Group, which is among the largest
commitment to apprentice training in the housebuilding industry,
together with around 80 sales trainees and a further 170 colleagues
training in disciplines such as quantity surveying, planning and
construction. In total, almost 15% of our workforce is
participating in a formal training programme.
In 2019, the Group has invested in its Human Resources function,
increasing the team by c. 40%, particularly in the training
function to enhance the level of support and guidance provided to
our employees. This investment will allow us to extend both the
scope and scale of the personal and professional development
opportunities to colleagues across the business.
The Group continues to be heavily involved in the Home Building
Skills Partnership, a joint initiative of the Construction Industry
Training Boarding and the Home Builders Federation (HBF) that aims
to address the shortage of skilled workers in the industry.
Voluntary Living Wage
We are pleased to report that with effect from January 2019, the
Group has adopted the payment criteria of the Living Wage
Foundation for its employees. The relevant Real Living Wage is
currently GBP9 an hour for our employees and is calculated based on
living costs. Although the vast majority of our employees were
already paid above this level, this has led to some small changes
to pay structure for 64 employees and increases for 2% of our
employees.
Diversity in the workforce
At 31 December 2018, the number of people we employed increased
to 4,943 (2017: 4,713) of whom 3,705 (75%) were male and 1,238
(25%) female (2017: 3,559 (75%) male; 1,154 (25%) female). At 31
December 2018 we had two female and six male directors on the
Company's Board and 35 female and 154 male colleagues in our 189
strong senior management team.
We have published our Gender Pay Gap report for 2018. The median
pay gap for the Persimmon Group was 8.0% (2017: 7.9%), compared to
the Office of National Statistics figures for 2017 of 18.4%.
Further information can be found in our Gender Pay Gap report on
our website,
www.persimmonhomes.com/corporate
The Group is committed to reducing the gender pay gap and
increasing the number of women in its workforce, and in the senior
management team. Indeed, of the total year on year increase of 230
employees, 37% were female. In 2018, the Board established a Gender
Diversity Panel to consider and suggest policy amendments and
initiatives to improve the gender diversity of the Group,
particularly within its senior management team. The Panel is made
up of four female members of the senior management team. They have
set an initial goal of engagement with local schools and colleges
during 2019 to promote the benefits of working within the
housebuilding industry to young women. The Panel also recommended
that the Group adopt a more formal flexible working policy to
support both men and women. This policy is being introduced in the
first quarter of 2019 for office based staff.
Persimmon is also a member of the Apprenticeship Diversity
Champions Network (ADCN), part of the National Apprenticeships
Service. ADCN members are apprentice employers who champion
diversity and drive an open and inclusive culture in recruitment
and employment practices. The Group shares case studies and best
practice with the aim of promoting diversity in the recruitment of
apprentices. We are also part of the HBF Diversity Group and are
actively participating in their initiative to raise awareness of
mental health in the construction industry.
Employee Engagement
The Group encourages feedback and new ideas from its staff to
enhance our culture, systems and processes. In February 2019, to
enhance the Group's existing engagement channels, an Employee
Engagement Panel was established consisting of twelve voluntary
members from a wide cross section of employees across the business,
plus the HR Director, who will chair the Panel. The membership of
the Panel will enable the views of a broad cross section of
employees, both site and office based, to be represented. The Panel
will meet twice a year and will strengthen feedback to the Board
from two way dialogue with the Group's employees. Some meetings
will be attended by a member of the Board in order that the Panel
can hear directly from them.
Members of the Board regularly visit the Group's local
businesses to see operations first-hand. Informal dinners are held
with Board members and local senior staff, which are an opportunity
for the Directors to receive feedback and to further explain
matters of particular focus and importance for the Group.
In addition, we publish an employee newsletter "HQ" regularly
throughout the year. A formal facility is incorporated where
employees can provide their feedback with any received being
provided to the Group's Corporate Responsibility Committee for
consideration.
Human Rights
We demand the appropriate levels of conduct from all of our
stakeholders, including our employees in all of our operations. We
value our reputation for ethical behaviour, integrity and
reliability. We have Human Rights and Anti-Bribery policies, a code
of Ethics and a Modern Slavery Statement, which are all available
on our website at www.persimmonhomes.com/corporate.
As we are a UK housebuilder and the vast majority of our
sub-contractors and suppliers are also UK based, we do not consider
that human rights abuses, modern slavery and bribery represent a
significant risk to our business. However, we have appropriate
procedures in place to provide assurance that our employees and
suppliers are working to the high standards we demand.
We have identified the most significant potential human rights
impact areas to be; the labour and employment rights of our
employees, subcontractors and those working within our supply
chain; the health and safety of our workforce; and the rights of
communities where we undertake our developments. As a responsible
employer, we are committed to compliance with all UK labour, health
and safety, planning and environmental legislation.
We continue to take our role in combatting modern slavery and
human trafficking seriously, and have implemented a number of
initiatives within the year to strengthen support in this area.
This included a detailed survey and analysis of our supply chain to
increase supplier and sub-contractor awareness of modern slavery
and to identify and further mitigate potential risks. Further
detail on this survey and our other initiatives on modern slavery
are set out in detail within our 2018 Modern Slavery Statement on
our website (see above).
Staff are given details of the Group's Anti-Bribery policy and
management reinforce the adherence to our policies and procedures.
In addition we have whistleblowing facilities to ensure employees
and others can raise concerns confidentially. During the year we
ran a campaign to remind employees of the whistleblowing facility.
Any whistleblowing reports are investigated by our Group Risk
department.
4. Providing a sustainable supply of high quality land
The Group's land buying and management strategy, which ensures
our continued growth over the longer term, is to continue to make
substantial investment in good locations where people wish to live
and work across the UK. Our planning and acquisition processes work
in partnership with local planning authorities and involve the
local community and other stakeholders as appropriate. Once sites
have been identified, further value is engineered through
innovative design, the use of our core house types, introducing
simplicity and economies of scale, and the creation of attractive
neighbourhoods for our customers.
Delays in achieving planning consents remain a constraint on the
speed with which we are able to deliver the new home volumes
required to satisfy local communities' housing needs. The
Government's Revised National Planning Policy Framework, published
in July 2018, aims to make it easier for planners, developers and
local councils to deliver good quality homes in places where people
want to live, at a faster pace. The Government's ambition is to
achieve the delivery of 300,000 new homes a year across all tenures
by the mid 2020's. We welcome the initiatives to support the
development of a more efficient planning system which will enable
the industry to continue to expand output and deliver the new homes
the country needs.
All of the Group's land acquisitions are assessed on a
consistent basis by dedicated and experienced management teams
taking into account likely levels of profitability and the sites'
projected return on capital employed. Acquisitions are only made
when specific thresholds are met.
The Group has maintained a robust high quality land platform for
the longer term by maintaining a disciplined approach to land
investment, remaining increasingly selective given the risks and
uncertainties generated by the headwinds confronting the UK
economy, in particular those relating to the process of the UK
leaving the EU. Given the strength of the existing land bank the
Group can, and will, remain selective in its land replacement
activities moving forward.
Our land bank
The Group has an excellent track record of successfully managing
the promotion of land through the planning system and its
subsequent acquisition. We have delivered 97,175 homes since 2012,
invested GBP3.81bn in new land and acquired c. 133,000 plots. This
has been achieved while maintaining greater velocity of asset turn
supporting superior levels of returns for our shareholders.
At the year end the Group owned 75,793 plots of land. Within
this land bank, the Group owned 47,305 plots on sites with detailed
planning consent, which are all under development. This will
provide c. 2.9 years of forward supply at 2018 output levels. These
plots will provide support to each of our regional operations as
they seek to achieve a sustainable market share. The Group has also
entered into conditional contracts for an additional 23,295 plots
on land which we are actively promoting through the planning
system.
The Group's land bank strength allows us to serve our markets
best by continuing to invest in the right land at the right time.
The growth in the Group's new home delivery of over 75% since the
launch of the Group's new strategy in 2012 has been enabled by the
substantial investment in new land over the last six years.
Our brands' investment in land
During 2018, our Persimmon brand acquired 12,811 new plots of
land resulting in a forward consented land bank at the end of 2018
of 69,275 plots (2017: 68,411). Of these total plots, 33,992 have
an implementable detailed residential planning consent (2017:
37,867) with all sites under construction. At 2018 output levels
the current land bank represents c. 2.8 years of forward
supply.
Charles Church owned and controlled 11,448 plots in its forward
consented land bank at the end of 2018 (2017: 11,191). Of these
total plots 5,274 have an implementable planning consent (2017:
5,774) providing c. 3.8 years of forward supply at 2018 sales
volumes. This forward supply reflects the success achieved in
gaining detailed planning consents on some larger Charles Church
developments, for example at Penny Pot Lane in Harrogate, North
Yorkshire, a development for 367 homes. During the year 1,651 new
plots were acquired by Charles Church.
Our strategic land
A fundamental element of the Group's business model is the
continued investment in strategic land and successfully promoting
this land through the planning system to deliver plots with
detailed residential consent. During the year we acquired interests
in a further c. 950 acres of strategic land and we converted 3,772
plots of land from our strategic land portfolio, representing c.
23% of the Group's land consumption. Conversions from our strategic
land bank continue to ensure the Group remains in a strong position
to offer new housing to local communities across the UK.
We are confident that our strategic land portfolio of c. 16,500
acres will, in due course, yield in excess of 100,000 forward plots
for future development by the Group and will continue to support
planning authorities and local communities to bring these sites
through the planning system as quickly as possible.
The successful promotion and conversion of plots from our
strategic land portfolio remains a focus for the Group and adds to
the strength of our land bank.
During the year, the Group's Persimmon business enjoyed success
in securing planning consents for residential development from its
strategic land portfolio with 2,862 plots, across 22 sites, being
delivered into its owned and under control land bank, representing
24% of the plots consumed by legal completions in the year. Notable
strategic land conversions were achieved at Sacriston, Monkswood,
in Durham, a c. 200 unit development and at Portchester, Cranleigh
Road in Hampshire, a site that will deliver c. 120 homes.
5. Securing quality and availability of materials
Engaging with our supply chain
The Group enjoys long established and strong relationships with
each of our main suppliers which we greatly value having invested
in these over the long term. We have a centralised procurement
department that seeks to secure Group deals covering all major
elements of our construction requirements. This helps the Group
establish certainty of quality, supply and cost of materials and
provides our suppliers with certainty of volume and revenues. In
addition, our operating businesses work closely with regional
suppliers to secure locally sourced materials. Local suppliers
benefit from the Group providing them with consistent order volumes
which help sustain their businesses and strengthen our supply
chain. The Group works with over 5,500 suppliers and is proud to
support over 30,000**** jobs in its supply chain.
Our regional offices engage with a large number of local
subcontractors in the construction of our homes. This ensures that
the Group secures good availability of the skilled trades that we
require locally and provides our subcontractors with continuity and
consistency of work. The Group supports over 20,000**** jobs on its
sites.
Off-site manufacturing
A key area of differentiation for the Group is through our
commitment to innovation. Our off-site manufacturing capabilities
assist the Group in securing the supply of some key materials which
increases the Group's resilience at times when the availability of
these key materials become constrained, together with providing the
opportunity for some cost mitigation.
Space4
Homes England are supporting the industry to meet the demand for
new housing through the increased use of modern methods of
construction, including modular build and timber frame construction
techniques.
The Group's Space4 business, based in Castle Bromwich near
Birmingham, produces a 'fabric first' solution to the construction
of new homes using off-site manufacturing techniques to produce
timber frames, highly insulated wall panels and roof cassettes. The
construction process using this system delivers high levels of
thermal efficiency for the new homes built and positions the Group
at the forefront of the industry with the ability to accommodate
changes to building regulations that are targeted to reduce carbon
emissions and global warming in the future. The use of the Space4
modern method of construction eases the requirement for some
traditional skills on site which can benefit productivity and build
programmes. Space4 employs approximately 140 people at its factory
and has recently increased its capacity to be able to supply up to
c. 9,500 units per year, consisting of c. 7,750 timber frames and
c. 1,750 'room in the roof' systems.
During 2018 Space4 delivered c. 6,000 timber frame house kits
and insulated roof systems to the Group's housebuilding businesses.
Since its launch in 2001, Space4 has supported the delivery of over
52,000 new homes to the market and has made an important
contribution to the Group's volume growth over recent years.
Brickworks
The Group started construction of its own Brickworks factory in
2016 to manufacture concrete bricks with the aim of securing the
supply of this key material element. The facility is now fully
operational with the capacity to produce c. 80m bricks annually,
which approximates to two thirds of the Group's brick requirements.
During the year, as we geared up production from the completion of
commissioning in the second quarter of 2018, the facility provided
c. 30m bricks to the Group's operations. The factory, sited at
Harworth near Doncaster, has good access to the motorway network
supporting efficient logistics for delivery to Group operations.
The plant and manufacturing process is highly automated and is very
durable with low maintenance requirements.
Our manufacturing process has strong environmental credentials
due to the significant reduction in energy usage compared to more
traditional clay brick manufacturing methods.
Tileworks
The Group commenced construction of its own concrete roof tile
manufacturing plant in August 2018, again with the aim of securing
the supply of this key material element. The factory is located
adjacent to the Group's Brickworks sharing common infrastructure.
The Tileworks factory aims to supply approximately two thirds of
the Group's requirements for roof tiles across the UK, and plans to
commence deliveries to site in the second half of 2019.
Both Brickworks and Tileworks are further developments of the
Group's off-site manufacturing capabilities, delivering
consistently high quality products and securing the Group's supply
of these key material components.
The impact of the UK's exit from the EU on our supply chain
The details regarding the basis on which the UK will leave the
EU, together with the proposed future trading relationship, remain
uncertain. As a result, we believe the key risks facing the
business associated with these circumstances are; the impact of
increased uncertainty surrounding the UK economy and availability
and potential impact on the cost of certain materials which form
part of our construction requirements.
The Group's activities are focused on the regional housing
markets across mainland UK, covering England, Wales and Scotland.
The Group has undertaken a review of its construction elements and
its supply chain. The majority of our material supplies are sourced
from within the UK. The Group has worked with its suppliers in
respect of any material supplies which may be exposed to some
disruption to availability. In these cases, our suppliers are
typically building up increased stock holdings and/or are changing
their ports of importation to mitigate the risk of delays. We are
also providing support by way of earlier and increased commitment
to our suppliers where required. In addition, our off-site
manufacturing capabilities, Space4, Brickworks and, going forward,
Tileworks, will help us mitigate any potential supply disruption
and material cost impacts.
Whilst we recognise the heightened risk profile associated with
the Brexit process, the Group is in a strong position in its
markets offering affordably priced homes, with a good range and
choice of affordable house types available across our national
outlet network. The Group has a very strong balance sheet with a
high quality land bank, robust liquidity, substantial cash holdings
and strong forward order book. The Group is in a strong position to
react to market conditions as events unfold.
6. Optimising working capital and returns
Delivering superior levels of shareholder value over the long
term and returning surplus capital to shareholders are key
priorities for the Group. We achieve this by:
-- Optimising our sales and the capital intensity of the Group
-- Maintaining a disciplined approach to the investment of capital in land at the appropriate
points in the housing cycle. The Group's land replacement and acquisition processes are key
features of our approach
-- Maintaining strong control over the Group's levels of work in progress across all of our developments
-- Managing our supply chain and entering into robust tendering processes to help manage our
costs
-- Vertical integration and the manufacture of some key material elements
-- Improving our build programme management through increasing use of the Group's core house
type portfolio across our developments
The Group has invested in strong land, planning and design teams
that have a proven track record in supporting the Group's
investment in appropriate land opportunities in attractive
locations, at the right point in the housing cycle. The Group's
investment decisions consider actual and prospective conditions in
both the land and sales markets. Our teams have a clear planning
and investment strategy that places our customers' needs firmly at
the centre of our land replacement activities. This ensures that
planning consents are successfully achieved for sites where demand
for the Group's well designed core house types is high.
A cost effective and efficient build programme is imperative in
optimising working capital. The Group's detailed build programme
management processes aim to support improved productivity and our
site management teams, suppliers, sub-contractors and site workers
have all worked extremely hard to deliver further improvements in
2018. The use of our core house types assist consistency of
construction and enable us to better control our development costs.
Our build and direct costs are 50 basis points lower than last year
at 52.1% of housing revenue (2017: 52.6% of housing revenue).
During 2018 we increased our investment in development work in
progress to support higher levels of output to meet demand in the
market. The cash efficiency of our land replacement activities, our
strong asset turn and the expansion of our cash margins, has
allowed us to continue to invest selectively in new land holdings
at a rate of c. 104% of 2018 consumption. Recognising the current
increased uncertainties regarding the future performance of the UK
economy we are maintaining our selective approach to new land
commitment.
By exercising this capital discipline, together with maximising
the cash efficiency of operational activities, the Group will
deliver strong cash generation whilst minimising financial risk
through the cycle.
The return of capital to shareholders that is considered surplus
to the reinvestment needs of the business is a key feature of the
Group's strategy launched in 2012. The evaluation as to whether the
business is operating at optimal scale within its regional markets,
executing disciplined land investment at the appropriate time
through the cycle, whilst minimising financial risk is a primary
consideration when assessing the level of surplus capital that is
available for return to shareholders.
Capital Return Plan
The Board has committed to maintain its existing Capital Return
Plan as explained earlier in the Operational Review. Instalments of
GBP732.3m or 235 pence per share (2017: GBP416.6m or 135 pence per
share) were paid during the year. In total surplus capital of
GBP7.20 per share, or GBP2.22 billion, has now been returned to
shareholders.
Dave Jenkinson Mike Killoran
Group Chief Executive Group Finance Director
25 February 2019
* Source Office of National Statistics
** Ranked by Trustpilot
*** Using average garden size and site density
**** Estimated using an economic toolkit
PERSIMMON PLC
Consolidated Statement of Comprehensive Income
For the year ended 31 December 2018
2018 2017
(restated -
note 1)
Note Total Total
GBPm GBPm
---------------------------------------- ----- ---------- -------------
Revenue 1, 2 3,737.6 3,597.8
Cost of sales (2,557.7) (2,526.1)
---------------------------------------- ----- ---------- -------------
Gross profit 1,179.9 1,071.7
Other operating income 5.6 9.4
Operating expenses (102.8) (126.0)
Profit from operations before
impairment of intangible assets 1,091.9 966.1
Impairment of intangible assets (9.2) (11.0)
---------------------------------------- ----- ---------- -------------
Profit from operations 1,082.7 955.1
Finance income 20.4 24.5
Finance costs (12.3) (13.5)
---------------------------------------- ----- ---------- -------------
Profit before tax 1,090.8 966.1
Tax 3 (204.4) (179.2)
---------------------------------------- ----- ---------- -------------
Profit after tax (all attributable
to equity holders of the parent) 886.4 786.9
---------------------------------------- ----- ---------- -------------
Other comprehensive income
Items that will not be reclassified
to profit:
Remeasurement gains on defined
benefit pension schemes 10 19.7 22.1
Tax 3 (3.3) (3.7)
---------------------------------------- ----- ---------- -------------
Other comprehensive income for
the year, net of tax 16.4 18.4
---------------------------------------- ----- ---------- -------------
Total recognised income for the
year 902.8 805.3
---------------------------------------- ----- ---------- -------------
Earnings per share
Basic 5 283.3p 255.0p
Diluted 5 280.8p 243.1p
---------------------------------------- ----- ---------- -------------
PERSIMMON PLC
Consolidated Balance Sheet
As at 31 December 2018
2018 2017
(restated -
note 1)
Note GBPm GBPm
--------------------------------- ----- ---------- -------------
Assets
Non-current assets
Intangible assets 193.4 202.6
Property, plant and equipment 58.0 52.5
Investments accounted for using
the equity method 3.0 3.0
Shared equity loan receivables 7 70.6 103.2
Trade and other receivables 7.0 7.0
Deferred tax assets 13.4 92.0
Retirement benefit assets 10 90.6 67.7
--------------------------------- ----- ---------- -------------
436.0 528.0
--------------------------------- ----- ---------- -------------
Current assets
Inventories 6 3,059.5 2,825.9
Shared equity loan receivables 7 16.3 14.1
Trade and other receivables 91.8 86.1
Cash and cash equivalents 9 1,048.1 1,302.7
--------------------------------- ----- ---------- -------------
4,215.7 4,228.8
--------------------------------- ----- ---------- -------------
Total assets 4,651.7 4,756.8
--------------------------------- ----- ---------- -------------
Liabilities
Non-current liabilities
Trade and other payables (270.4) (294.1)
Deferred tax liabilities (27.7) (24.0)
Partnership liability (35.2) (38.5)
--------------------------------- ----- ---------- -------------
(333.3) (356.6)
--------------------------------- ----- ---------- -------------
Current liabilities
Trade and other payables (1,058.5) (1,099.6)
Partnership liability (5.4) (5.4)
Current tax liabilities (60.0) (93.6)
--------------------------------- ----- ---------- -------------
(1,123.9) (1,198.6)
--------------------------------- ----- ---------- -------------
Total liabilities (1,457.2) (1,555.2)
--------------------------------- ----- ---------- -------------
Net assets 3,194.5 3,201.6
--------------------------------- ----- ---------- -------------
Equity
Ordinary share capital issued 31.7 30.9
Share premium 15.5 13.5
Capital redemption reserve 236.5 236.5
Other non-distributable reserve 276.8 276.8
Retained earnings 2,634.0 2,643.9
--------------------------------- ----- ---------- -------------
Total equity 3,194.5 3,201.6
--------------------------------- ----- ---------- -------------
PERSIMMON PLC
Consolidated Statement of Changes in Shareholders' Equity
For the year ended 31 December 2018
Share Share Capital Other non-distributable Retained Total
capital premium redemption reserve earnings
reserve
GBPm GBPm GBPm GBPm GBPm GBPm
--------------------------------- --------- --------- ------------ ------------------------ ---------- --------
Balance at 1 January
2017 30.8 10.6 236.5 276.8 2,182.7 2,737.4
Profit for the year - - - - 786.9 786.9
Other comprehensive
income - - - - 18.4 18.4
Transactions with owners:
Dividend on equity
shares - - - - (416.6) (416.6)
Issue of new shares 0.1 2.9 - - - 3.0
Exercise of share options/share
awards - - - - (0.9) (0.9)
Share-based payments - - - - 72.5 72.5
Satisfaction of share
options from own shares
held - - - - 0.9 0.9
--------------------------------- --------- --------- ------------ ------------------------ ---------- --------
Balance at 31 December
2017 30.9 13.5 236.5 276.8 2,643.9 3,201.6
--------------------------------- --------- --------- ------------ ------------------------ ---------- --------
Profit for the year - - - - 886.4 886.4
Other comprehensive
income - - - - 16.4 16.4
Transactions with owners:
Dividend on equity
shares - - - - (732.3) (732.3)
Issue of new shares 0.8 2.0 - - - 2.8
Own shares purchased - - - - (1.3) (1.3)
Exercise of share options/share
awards - - - - (1.0) (1.0)
Share-based payments - - - - 1.1 1.1
Net settlement of share-based
payments - - - - (180.2) (180.2)
Satisfaction of share
options from own shares
held - - - - 1.0 1.0
--------------------------------- --------- --------- ------------ ------------------------ ---------- --------
Balance at 31 December
2018 31.7 15.5 236.5 276.8 2,634.0 3,194.5
--------------------------------- --------- --------- ------------ ------------------------ ---------- --------
The other non-distributable reserve arose prior to transition to
IFRSs and relates to the issue of ordinary shares to acquire the
shares of Beazer Group Plc in 2001.
PERSIMMON PLC
Consolidated Cash Flow Statement
For the year ended 31 December 2018
2018 2017
Note GBPm GBPm
--------------------------------------- ----- -------- --------
Cash flows from operating activities:
Profit for the year 886.4 786.9
Tax charge 3 204.4 179.2
Finance income (20.4) (24.5)
Finance costs 12.3 13.5
Depreciation charge 10.0 8.4
Impairment of intangible assets 9.2 11.0
Share-based payment charge 7.9 18.8
Net imputed interest income 1.9 5.0
Other non-cash items (0.2) (1.5)
--------------------------------------- ----- -------- --------
Cash inflow from operating
activities 1,111.5 996.8
Movement in working capital:
Increase in inventories (225.5) (176.6)
Increase in trade and other
receivables (26.7) (20.5)
(Decrease)/increase in trade
and other payables (82.7) 131.1
Decrease in shared equity loan
receivables 41.6 46.6
--------------------------------------- ----- -------- --------
Cash generated from operations 818.2 977.4
Interest paid (3.9) (3.9)
Interest received 5.8 3.4
Tax paid (165.8) (152.9)
--------------------------------------- ----- -------- --------
Net cash inflow from operating
activities 654.3 824.0
--------------------------------------- ----- -------- --------
Cash flows from investing activities:
Purchase of property, plant
and equipment (15.5) (18.0)
Proceeds from sale of property,
plant and equipment 0.5 0.3
--------------------------------------- ----- -------- --------
Net cash outflow from investing
activities (15.0) (17.7)
--------------------------------------- ----- -------- --------
Cash flows from financing activities:
Payment of Partnership liability (3.2) (3.0)
Own shares purchased (1.3) -
Share options consideration 2.8 3.0
Net settlement of share-based (159.9) -
payments
Dividends paid 4 (732.3) (416.6)
--------------------------------------- ----- -------- --------
Net cash outflow from financing
activities (893.9) (416.6)
--------------------------------------- ----- -------- --------
(Decrease)/increase in net
cash and cash equivalents 9 (254.6) 389.7
--------------------------------------- ----- -------- --------
Cash and cash equivalents at
the beginning of the year 1,302.7 913.0
--------------------------------------- ----- -------- --------
Cash and cash equivalents at
the end of the year 9 1,048.1 1,302.7
--------------------------------------- ----- -------- --------
Notes
1. Basis of preparation
The results for the year have been prepared on a basis
consistent with the accounting policies set out in the Persimmon
Plc Annual Report for the year ended 31 December 2018.
The preparation of the financial statements in conformity with
the Group's accounting policies requires the Directors to make
estimates and assumptions that affect the reported amounts of
assets and liabilities, the disclosure of contingent assets and
liabilities at the balance sheet date and the reported amounts of
revenue and expenses during the reported period. Whilst these
estimates and assumptions are based on the Directors' best
knowledge of the amount, events or actions, actual results may
differ from those estimates.
The financial information set out above does not constitute the
Group's statutory accounts for the years ended 31 December 2018 or
2017, but is derived from those accounts. Statutory accounts for
2017 have been delivered to the Registrar of Companies, and those
for 2018 will be delivered in due course. The auditor has reported
on those accounts; their reports were (i) unqualified, (ii) did not
include reference to any matters to which the auditor drew
attention by way of emphasis without qualifying their report and
(iii) did not contain statements under Section 498(2) or (3) of the
Companies Act 2006.
Whilst the financial information included in this announcement
has been computed in accordance with IFRS as adopted by the
European Union, this announcement does not itself contain
sufficient information to comply with IFRS. The Company expects to
send its Annual Report 2018 to shareholders on 18 March 2019.
The Group's business activities, together with the factors
likely to affect its future development, performance and position
are set out in the Strategic Report in the Annual Report and the
financial statements and notes. The Directors believe that the
Group is well placed to manage its business risks successfully. The
principal risks that may impact the Group's performance and their
mitigation are outlined in note 11. After making enquiries, the
Directors have a reasonable expectation that the Group has adequate
resources to fund its operations for the foreseeable future. For
this reason, they continue to adopt the going concern basis in
preparing the annual financial statements.
Adoption of new and revised International Financial Reporting
Standards (IFRSs) and Interpretations (IFRICs)
The following relevant new standards and amendments to standards
are mandatory for the first time for the financial year beginning 1
January 2018:
-- IFRS 9 Financial Instruments
-- IFRS 15 Revenue from Contracts with Customers
-- Amendments to IFRS 2 Classification and Measurement of Share-based Payment Transactions
-- Annual Improvements to IFRS Standards 2014-2016 Cycle
With the exception of IFRS 15 Revenue from Contracts with
Customers, the effects of the implementation of these standards
have been limited to presentational and disclosure amendments.
Following the implementation of IFRS 15, Revenue from Contracts
with Customers, revenues reported in the Consolidated Statement of
Comprehensive Income now include the fair value of consideration
received or receivable on the sale of part exchange properties, in
addition to the previously reported fair value of the consideration
received or receivable on the legal completion of a newly built
residential property sale. IFRS 15 has been applied fully
retrospectively and as a result of the change revenue and cost of
sales for the year ended 31 December 2017 has been increased by
GBP175.5m. For the current period, revenue is GBP191.8m higher than
it would have been prior to the implementation of IFRS 15. There is
no change to the reported profit from operations and there is no
impact on the Group's cash flows or balance sheet.
IFRS 9 Financial Instruments came into effect on 1 January 2018
replacing IAS 39 Financial Instruments: Recognition and Measurement
and requires changes to the classification and measurement of
certain financial instruments from that under IAS 39. The new
standard has been applied fully retrospectively and on review the
majority of the Group's financial assets and liabilities will
continue to be accounted for on an identical basis under IFRS 9 as
they were under IAS 39. There is no material effect from applying
IFRS 9 for expected credit losses.
The exception to this is the Group's shared equity loan
portfolio. These were held under IAS 39 as Available for Sale
Financial Assets. This classification is no longer available under
IFRS 9 and the assets have been reclassified as Fair Value Through
Profit and Loss and reported as "Shared equity loan receivables" in
the Balance Sheet. The fair value of the loans is unchanged
following this reclassification and there is no impact on the
Profit or Loss or Balance Sheet in the current or comparative
periods. In implementing this change we have more appropriately
reflected the ageing of the Shared equity loan receivables and have
analysed the receivable between non-current and current for the
reported period end and its comparative period ends. There has been
no impact on profits or cash flows in the current or previous
periods as a result of this re-analysis.
Amendments to IFRS 2 Classification and Measurement of
Share-based Payment Transactions was endorsed by the EU during the
year and is effective for periods commencing on or after 1 January
2018. The amendment has been applied in the period and had no
impact on prior periods.
The Group has not applied the following new standards and
amendments to standards which are EU endorsed but not yet
effective:
-- IFRS 16 Leases
-- Amendments to IFRS 9 Prepayment Features with Negative Compensation
-- IFRIC 23 Uncertainty over Income Tax Treatments
The Group is currently considering the implication of these new
standards with the expected impact upon the Group as follows:
IFRS 16 Leases will be effective for the Group from 1 January
2019. The key effect of this standard will be to require the
company to create a long term depreciating "right of use" asset and
corresponding lease liability for leases currently classified as
operating leases and charged over the lease term in accordance with
the current standard IAS 17 Leases. The Group operate a number of
such operating leases, principally in relation to office properties
and vehicles. If IFRS 16 was applied from 1 January 2018, both
fixed assets and other payables would have been increased by
GBP10.0m at 31 December 2018. Reported profit from operations would
have been GBP0.4m higher at GBP1,083.1m with reported profit before
tax being unchanged at GBP1,090.8m.
2. Revenue
2018 2017
GBPm GBPm
------------------------------------------------------- ------------------- -------------------
Revenue from the sale of new housing 3,545.8 3,422.3
Revenue from the sale of part exchange
properties 191.8 175.5
Revenue from the sale of goods as reported
in the statement of comprehensive income 3,737.6 3,597.8
------------------------------------------------------- ------------------- -------------------
3. Tax
2018 2017
GBPm GBPm
--------------------------------------------------------- ----------------- -----------------
Tax charge comprises:
UK corporation tax in respect of the current
year 202.1 187.1
Adjustments in respect of prior years (5.0) (8.4)
--------------------------------------------------------- ----------------- -----------------
197.1 178.7
--------------------------------------------------------- ----------------- -----------------
Deferred tax relating to origination and
reversal of temporary differences 6.9 1.0
Adjustments recognised in the current year
in respect of prior years deferred tax 0.4 (0.5)
--------------------------------------------------------- ----------------- -----------------
7.3 0.5
--------------------------------------------------------- ----------------- -----------------
204.4 179.2
--------------------------------------------------------- ----------------- -----------------
The tax charge for the year can be reconciled to the accounting
profit as follows:
2018 2017
GBPm GBPm
----------------------------------------------------------- ------------------- -----------------
Profit from continuing operations 1,090.8 966.1
----------------------------------------------------------- ------------------- -----------------
Tax calculated at UK corporation tax rate
of 19% (2017: 19.25%) 207.3 186.0
Accounting base cost not deductible for 0.5 -
tax purposes
Goodwill impairment losses that are not
deductible 1.7 2.1
Expenditure not allowable for tax purposes 0.3 0.2
Effect of change in rate of corporation
tax (2.2) (0.1)
Deferred tax written off on lapsed share-based 1.4 -
payments
Adjustments in respect of prior years (4.6) (9.0)
----------------------------------------------------------- ------------------- -----------------
Tax charge for the year recognised in profit 204.4 179.2
----------------------------------------------------------- ------------------- -----------------
The Group's overall effective tax rate of 18.7% has been reduced
from the mainstream rate of 19% by a prior year tax credit arising
from the removal of some uncertainties regarding the Group's prior
year tax computations.
The applicable corporation tax rate has reduced from 19.25% in
the prior year to 19% in line with corporation tax rates effective
from 1 April 2017. In relation to the Group's deferred tax
calculations, a further corporation tax rate change enacted on 15
September 2016 effective from 1 April 2020 (17%) has been used
unless timing differences are expected to reverse in 2019 or
2020.
In addition to the amount recognised in profit, deferred tax of
GBP3.3m was charged directly to other comprehensive income (2017:
charge of GBP3.7m), and a GBP71.7m charge was recognised in equity
(2017: credit of GBP47.4m). The Group has recognised deferred tax
liabilities of GBP15.4m (2017: liabilities of GBP11.5m) on
retirement benefit assets of GBP90.6m (2017: assets of
GBP67.7m).
4. Dividends/Return of capital
2018 2017
GBPm GBPm
----------------------------------------------------------- ----------------- -----------------
Amounts recognised as distributions to capital
holders in the period:
2016 dividend to all shareholders of 25p
per share paid 2017 - 77.1
2016 dividend to all shareholders of 110p
per share paid 2017 - 339.5
2017 dividend to all shareholders of 125p 388.5 -
per share paid 2018
2017 dividend to all shareholders of 110p 343.8 -
per share paid 2018
Total capital return 732.3 416.6
----------------------------------------------------------- ----------------- -----------------
The Directors propose to return 125 pence of surplus capital to
shareholders for each ordinary share held on 8 March 2019 with
payment made on 29 March 2019 as an interim dividend in respect of
the financial year ended 31 December 2018. In addition, the
Directors propose the payment of the regular annual capital return
instalment of 110 pence per share, with payment scheduled for 2
July 2019 as a final dividend with respect to the financial year
ended 31 December 2018, to shareholders for each ordinary share
held on 14 June 2019. The total return to shareholders is therefore
235 pence per share (2018: 235 pence per share) in respect of the
financial year ended 31 December 2018.
5. Earnings per share
Basic earnings per share is calculated by dividing the profit
for the year attributable to ordinary shareholders by the weighted
average number of ordinary shares in issue during the year,
excluding those held in the employee benefit trusts and any
treasury shares, all of which are treated as cancelled, which were
312.9m (2017: 308.6m).
Diluted earnings per share is calculated by dividing the profit
for the year attributable to ordinary shareholders by the weighted
average number of ordinary shares in issue adjusted to assume
conversion of all potentially dilutive ordinary shares from the
start of the year, giving a figure of 315.7m (2017: 323.7m).
Underlying earnings per share excludes goodwill impairment. The
earnings per share from continuing operations were as follows:
2018 2017
--------------------------------------- ------- -------
Basic earnings per share 283.3p 255.0p
Underlying basic earnings per share 286.3p 258.6p
Diluted earnings per share 280.8p 243.1p
Underlying diluted earnings per share 283.7p 246.5p
--------------------------------------- ------- -------
The calculation of the basic and diluted earnings per share is
based upon the following data:
2018 2017
GBPm GBPm
------------------------------------------------------------- ----------------- ------------------
Underlying earnings attributable to shareholders 895.6 797.9
Goodwill impairment (9.2) (11.0)
------------------------------------------------------------- ----------------- ------------------
Earnings attributable to shareholders 886.4 786.9
------------------------------------------------------------- ----------------- ------------------
6. Inventories
2018 2017
GBPm GBPm
------------------------------------- ------------------- -------------------
Land 2,077.2 2,010.6
Work in progress 881.8 723.9
Part exchange properties 56.2 45.2
Showhouses 44.3 46.2
------------------------------------- ------------------- -------------------
3,059.5 2,825.9
------------------------------------- ------------------- -------------------
The Group conducted a further review of the net realisable value
of its land and work in progress portfolio during 2018. Our
approach to this review has been consistent with that conducted at
31 December 2017. Net realisable provisions held against
inventories at 31 December 2018 were GBP37.8m (2017: GBP41.9m).
Following the 2018 review, GBP16.5m (2017: GBP28.3m) of inventories
are valued at fair value less costs to sell rather than historical
cost.
7. Shared equity loan receivables
2018 2017
GBPm GBPm
---------------------------------------------------------- ------------------ ------------------
Shared equity loan receivables at 1 January 117.3 148.7
Settlements (41.6) (46.6)
Gains (Finance income) 11.2 15.2
---------------------------------------------------------- ------------------ ------------------
Shared equity loan receivables at 31 December 86.9 117.3
---------------------------------------------------------- ------------------ ------------------
All gains/losses have been recognised through finance income in
the statement of comprehensive income. Of the gains recognised in
finance income for the period, GBP3.0m (2017: GBP4.9m) was
unrealised.
8. Financial instruments
In aggregate, the fair value of financial assets and liabilities
are not materially different from their carrying value.
Financial assets and liabilities carried at fair value are
categorised within the hierarchical classification of IFRS 7
Revised (as defined within the standard) as follows:
2018 2017
-------------------------------- ------ ------
Level Level
3 3
GBPm GBPm
-------------------------------- ------ ------
Shared equity loan receivables 86.9 117.3
-------------------------------- ------ ------
Shared equity loan receivables
Shared equity loan receivables represent loans advanced to
customers and secured by way of a second charge on their new home.
They are carried at fair value. The fair value is determined by
reference to the rates at which they could be exchanged by
knowledgeable and willing parties. Fair value is determined by
discounting forecast cash flows for the residual period of the
contract by a risk adjusted rate.
There exists an element of uncertainty over the precise final
valuation and timing of cash flows arising from these loans. As a
result the Group has applied inputs based on current market
conditions and the Group's historic experience of actual cash flows
resulting from such arrangements. These inputs are by nature
estimates and as such the fair value has been classified as level 3
under the fair value hierarchy laid out in IFRS 13 Fair Value
Measurement.
Significant unobservable inputs into the fair value measurement
calculation include regional house price movements based on the
Group's actual experience of regional house pricing and management
forecasts of future movements, weighted average duration of the
loans from inception to settlement of 10 years (2017: 10 years) and
discount rate 9% (2017: 8%) based on current observed market
interest rates offered to private individuals on secured second
loans.
The discounted forecast cash flow calculation is dependent upon
the estimated future value of the properties on which the shared
equity loans are secured. Adjustments to this input, which might
result from a change in the wider property market, would have a
proportional impact upon the fair value of the loan. Furthermore,
whilst not easily accessible in advance, the resulting change in
security value may affect the credit risk associated with the
counterparty, influencing fair value further.
9. Reconciliation of net cash flow to net cash and analysis of net cash
2018 2017
GBPm GBPm
----------------------------------------------------- ------------------- -------------------
(Decrease)/increase in net cash and cash
equivalents in cash flow (254.6) 389.7
Net cash at 1 January 1,302.7 913.0
----------------------------------------------------- ------------------- -------------------
Net cash at 31 December 1,048.1 1,302.7
----------------------------------------------------- ------------------- -------------------
10. Retirement benefit assets
As at 31 December 2018 the Group operated four employee pension
schemes, being two Group personal pension schemes and two defined
benefit pension schemes. Remeasurement gains and losses in the
defined benefit schemes are recognised in full as other
comprehensive income within the consolidated statement of
comprehensive income. All other pension scheme costs are reported
in profit or loss.
The amounts recognised in the consolidated statement of
comprehensive income are as follows:
2018 2017
GBPm GBPm
----------------------------------------------- ------- -------
Current service cost 2.0 2.3
Past service cost 5.5 -
Administrative expense 0.9 0.7
----------------------------------------------- ------- -------
Pension cost recognised as operating expense 8.4 3.0
----------------------------------------------- ------- -------
Interest cost 14.2 15.9
Return on assets recorded as interest (15.9) (16.9)
----------------------------------------------- ------- -------
Pension cost recognised as net finance credit (1.7) (1.0)
----------------------------------------------- ------- -------
Total defined benefit pension cost recognised
in profit or loss 6.7 2.0
Remeasurement gains recognised in other
comprehensive income (19.7) (22.1)
----------------------------------------------- ------- -------
Total defined benefit scheme gain recognised (13.0) (20.1)
----------------------------------------------- ------- -------
The past service cost recognised in the period is an estimate of
the impact of recent legal rulings regarding Guaranteed Minimum
Pension equalisation (GMP). The amounts included in the balance
sheet arising from the Group's obligations in respect of the
Pension Scheme are as follows:
2018 2017
GBPm GBPm
------------------------------------- -------- --------
Fair value of Pension Scheme assets 616.8 649.1
Present value of funded obligations (526.2) (581.4)
------------------------------------- -------- --------
Net pension asset 90.6 67.7
------------------------------------- -------- --------
11. Principal risks and Viability Statement
UK's exit from the EU
Residual Impact Mitigation
Risk The UK's exit from the We continue to monitor the political
High European Union may lead situation, the UK economy and
to increased economic the housing market through the
Change uncertainty adversely review of external information
in 2018 impacting: consumer confidence, and changes in the behaviour of
Increased demand and pricing for our customer base. We closely
new homes, revenues, profits manage and control our work in
and cash flows and may progress and land investment and
result in the impairment our stringent investment appraisals
of asset values. will continue, ensuring exposure
Potential legislative to market disruption is reduced.
changes on customs arrangements We maintain close contact with
and increases in trade our key suppliers and will continue
tariffs could create bottlenecks to employ robust tendering processes
at ports and impact on to ensure risks around material
the availability and cost availability and cost are mitigated
of imported materials as far as possible. The vertical
and components within integration afforded by use of
our supply chain. our own Brickworks, Space4 and
Possible restrictions going forwards Tileworks production
on freedom of movement mitigates this risk further.
may impact on the availability We will remain focused on our
of skilled construction training initiatives to improve
workers. the supply of the necessary management
and construction skills the Group
requires.
(Also see mitigation and review
of Government policy and Labour
and Resources)
----------------------------------- -------------------------------------------
National and regional economic conditions
Residual Impact Mitigation
Risk The housebuilding industry We continually monitor lead indicators
High is sensitive to changes on the future direction of the
in the economic environment, UK housing market so as to manage
Change including unemployment, our exposure to any future market
in 2018 interest rates and consumer disruption. Our diversity of geographical
No change confidence. Any deterioration market presence and our continual
in economic conditions monitoring of our geographical
may have an adverse impact spread helps us mitigate the effects
on demand and pricing of local economic fluctuations.
for new homes, which could We control the level of build
have a material effect on site by closely monitoring
on our revenues, margins, our work in progress levels. We
profits and cash flows carry out extensive due diligence
and result in the impairment prior to our land investment decisions
of asset values. having regard to local market
Economic conditions in conditions and the Group's existing
the land market may adversely strategic and on market land holdings.
affect the availability Significant land additions are
of a sustainable supply reviewed by the Board.
of land at appropriate
levels of return.
----------------------------------- -------------------------------------------
Government policy
Residual Impact Mitigation
Risk Changes to Government We monitor Government policy in
High policy have the potential relation to the housing market
to impact on several aspects very closely. Consistency of policy
Change of our strategy and operational formulation and application is
in 2018 performance. For example, very supportive of the housebuilding
No change changes to the planning industry, encouraging continued
system, changes in the substantial investment in land,
tax regime, or further work in progress and skills to
amendment of the Help support output growth. We actively
to Buy scheme could have manage our land investment decisions
an adverse effect on revenues, and levels of work in progress
margins and asset values. to mitigate exposure to external
Changes to the planning influences.
system may also adversely Both major political parties in
impact the Group's ability the UK continue to support the
to source suitable land Help to Buy scheme, which was
to deliver appropriate recently extended to remain in
levels of return. place until 2023.
----------------------------------- -------------------------------------------
Mortgage availability
Residual Impact Mitigation
Risk Any restrictions in the We monitor Bank of England commentary
High availability or affordability on credit conditions including
of mortgages for customers the monthly approvals for house
Change could reduce demand for purchases and UK Finance's monthly
in 2018 new homes and affect revenues, reports and lenders' announcements
No change profits and cash flows. for trends in lending We monitor
customer access to mortgages through
our sales processes. We ensure
that our investment in land and
work in progress is appropriate
for our level of sales and our
expectations for market conditions.
The Government's Help to Buy scheme,
which is anticipated to remain
in place until 2023, supports
customers to gain access to the
housing market across the UK with
competitive mortgage rates.
----------------------------------- -------------------------------------------
Health and safety
Residual Impact Mitigation
Risk The health and safety The Board has a strong commitment
High of our employees, subcontractors, to health and safety and managing
customers and visitors the risks in this area effectively.
Change to our construction sites This is implemented by comprehensive
in 2018 is of paramount importance management systems and controls,
No change to us. Accidents on our managed by our Group Health and
sites could lead to reputational Safety Department, which includes
damage and financial penalties. detailed training and inspection
programmes to minimise the likelihood
and impact of accidents on our
sites. While all reasonable steps
are taken to reduce the likelihood
of an incident, the potential
impacts of any such incident are
considered to be high.
----------------------------------- -------------------------------------------
Labour and Resources: Skilled workforce, retention and succession
Residual Impact Mitigation
Risk Access to an appropriately We closely monitor our build programmes
High skilled workforce is a to enable us to manage our labour
key requirement for the requirements effectively. We operate
Change Group. Increasing UK house in-house apprentice and training
in 2018 building activity in recent programmes, including our Combat
Increased years has increased demand to Construction (C2C) programme,
for skilled labour, which to provide adequate supply of
has increased pressure skilled labour.
on costs. We are committed to playing a
A skilled management team full and active role in external
is essential in maintaining initiatives to address the skills
operational performance shortage such as the Home Building
and the implementation Skills Partnership, a joint initiative
of the Group's strategy. of the Construction Industry Training
Board and the Home Builders Federation.
Where appropriate, we also use
the Group's Space4 modern method
of construction which helps diversify
resource requirements on site.
The Group focuses on retaining
its key staff through a range
of measures, including career
management and performance incentives.
At the most senior level, the
Nominations Committee oversees
these processes and promotes effective
succession planning.
----------------------------------- -------------------------------------------
Labour and Resources: Materials and Land Purchasing
Residual Impact Mitigation
Risk Materials Materials
Medium
Recent growth in UK housebuilding Our build programmes and our supply
Change has led to an increased chain are closely monitored to
in 2018 demand for materials which allow us to manage and react to
No change is placing greater pressure any supply chain issues. We build
on the supply chain. This strong relationships with key
may continue to cause suppliers over the long term to
availability constraints ensure consistency of supply and
and increase cost pressures. cost efficiency.
We have invested in expanding
our off-site manufacturing hub
at Harworth, near Doncaster, to
strengthen security of supply.
Our brick plant is providing a
significant proportion of the
bricks we use and our roof tile
Land Purchasing manufacturing facility will commence
Land may be purchased operations in 2019. This complements
at too high a price, in our existing off-site manufacturing
the wrong place and at capability at Space4, which produces
the wrong time in the timber frames, highly insulated
housing cycle. wall panels and roof cassettes
as a modern method of constructing
new homes.
Land Purchasing
All land purchases undergo stringent
viability assessments performed
by our dedicated land and planning
teams and must meet specific levels
of projected returns.
The Board review and determine
the appropriate timing of land
purchases having regard to current
market conditions and sales rates.
----------------------------------- -------------------------------------------
Strategy
Residual Impact Mitigation
Risk The Group's strategy has The Group's strategy is agreed
Low been developed by the by the Board at an annual strategy
Board as the most appropriate meeting and thereafter regularly
Change approach to successfully reviewed at Board meetings. The
in 2018 deliver the optimal sustainable Board engages with management
No change value for shareholders and employees to ensure the strategy
and other stakeholders. is communicated and understood
As political, economic and that all employees have a
and other conditions evolve, clear understanding of the potential
it is possible that the benefits and risks of the strategy.
strategy currently being
pursued may cease to be
the most appropriate approach.
----------------------------------- -------------------------------------------
Climate Change
Residual Impact Mitigation
Risk Should the effects of We monitor our operational efficiency
Medium climate change and the and direct environmental impact
UK's transition to a lower in a number of ways including
Change carbon economy lead to measuring our own CO2 emissions
in 2018 increasing national regulation and the amount of waste we generate
New this could cause additional for each home we sell.
planning delays, increase We systematically consider the
the cost and accessibility potential impacts of climate change
of materials required throughout the land acquisition,
within our construction planning and build processes and
process and potentially work closely with planning authorities
limit their supply or and other statutory bodies to
require additional features manage and mitigate risks. For
which could significantly example, we conduct full environmental
increase our costs. assessments for each parcel of
Changes in weather patterns land we acquire for development
and the frequency of extreme to ensure our activities fulfil
weather events, particularly all obligations, respecting the
storms and flooding, may natural environment and the communities
increase the likelihood for which we are delivering newly
of disruption to the construction built homes. We are keen to adopt
process. The availability Sustainable Urban Drainage Systems
of mortgages and property and other technology on all our
insurance may reduce should new sites, subject to local planning
financial institutions requirements, to address the risk
take account of impacts of flooding.
relating to climate change. We continually seek to strengthen
Changes in weather patterns our supply chain. Our off-site
may increase build costs manufacturing facilities provide
and/or development timeframes. us with greater assurance of quality
and supply, and use modern methods
of construction and technology
to assist the mitigation of climate
change related risks.
----------------------------------- -------------------------------------------
Reputation
Residual Impact Mitigation
Risk Access to housing is a The Group has a strong commitment
Medium significant social issue to high quality of operations.
and housebuilding is a Oversight from the Board seeks
Change high profile industry to ensure key processes are robust
in 2018 which attracts a great and any matters are addressed.
New deal of media and political We engage actively with stakeholders
attention. In cases where to minimise the risks of reputational
customer experiences, damage and we aim to comply with
operational performance, best practice in corporate governance.
management of health and We actively support local communities
safety, remuneration matters in addressing housing needs, in
or local planning concerns creating attractive neighbourhoods
fall short of our usual and employing local people, both
high standards, this may on our sites and in the supply
attract media attention. chain.
This may impinge on the Significant contributions are
reputation of the business made to local infrastructure and
which may have an adverse good causes within the communities
impact on the Group's in which the Group operates.
operations.
----------------------------------- -------------------------------------------
Regulatory compliance
Residual Impact Mitigation
Risk The housebuilding industry We operate comprehensive management
Low is subject to extensive systems to ensure regulatory and
and complex laws and regulations, legal compliance, including a
Change particularly in areas suite of policies and procedures
in 2018 such as land acquisition, covering key areas of legislation
No change planning and the environment. and regulation.
Ensuring compliance in We engage extensively with planning
these areas can result authorities and other stakeholders
in delays in securing to reduce the likelihood and impact
the land required for of any delays or disruption. We
development and in construction. also hold a land bank sufficient
Any failure to comply to provide security of supply
with regulations could for medium term land requirements.
result in damage to the
Group's reputation and
potential imposition of
financial penalties.
----------------------------------- -------------------------------------------
VIABILITY STATEMENT
Persimmon's prospects and viability
The long term prospects and viability of the Group are a
consistent focus of the Board when determining and monitoring the
Group's strategy and business model. The identification and
mitigation of the Group's principal risks also form part of the
Board's assessment of long term prospects and viability*.
Assessing Persimmon's prospects
Persimmon has built a strong position in the UK's house building
market over many years recognising the potential for long term
growth across regional housing markets. Whilst the long term
demographic fundamentals of continued positive population growth
and new household formation, together with the requirement to
replace and improve the quality of the country's housing stock,
provide a long term supportive backdrop for the industry, the Board
recognise the inherent cyclicality of the UK housing market. This
cyclicality reflects the effect that some of the principal risks
that challenge the Group's strategy and business model can have
over time.
Persimmon possesses the key ingredients that are required to
realise greater future success - talented commercially driven
teams, strong local community and customer relationships, market
knowledge, expertise and industry know-how, and high quality land
located in places where our customers want to live and work. By
building on these solid foundations the Group aims to support local
communities through continued investment in its people, its land,
and its development sites and in its supply chain.
The Group adopts a disciplined annual business planning regime
which involves the management teams of the Group's 31 house
building businesses and senior management, with input and oversight
of the Board. The Group combines detailed five year business plans
generated by each house building business from the "bottom up" with
ten year projections constructed from the "top down" to properly
inform the Group's business planning over these longer term
horizons. Zero-based annual budgets are established for each
business twice a year.
This planning process provides a significant contribution to the
Board's assessment of the Group's prospects. The Group's current
market position, its strategy and business model, and the risks
that may challenge its business model are all included in the
Board's assessment of the prospects of the Group.
Key Factors in assessing the long term prospects of the
Group:
1. The Group's current market positioning
-- Strong sales network from active developments across the UK providing geographic diversification
of revenue generation
-- Three distinct brands providing diversified products and pricing deliver further diversification
of sales
-- Imaginative and comprehensive master planning of development schemes with good amenity value
to support sustainable neighbourhoods and sales activity
-- Disciplined land replacement reflecting the extent and location of housing needs across the
UK provides a high quality land bank supporting future operations
-- Long term supplier and subcontractor relationships keeping construction costs well controlled
-- A flexible cost structure is maintained to allow the effective response to changes in market
conditions
-- Continued investment to support higher levels of customer service
-- Strong financial position with considerable cash reserves and with additional substantial
working capital credit facilities maturing March 2023
2. Strategy and business model
-- Clear strategy for disciplined growth and surplus capital generation launched in 2012
-- Strategy recognises the importance of mitigating the impacts of the cyclicality of the UK
housing market
-- Substantial investment in staff training and support to sustain operations over the long term
-- Approach to land investment and development activity provides the opportunity to generate
high quality growth delivered by the management talent in the business
-- Differentiation through vertical integration achieving security of supply of key materials
and complementary modern methods of construction to support growth in output
-- Simple capital structure maintained with no structural gearing
3. Principal risks associated with the Group's strategy and business model include
-- Risk of the impact of disruption to the UK economy resulting from the process of the UK leaving
the EU
-- Market risk related to reduced consumer confidence due to regional economic uncertainties
-- The risk of a reduction in mortgage funding availability and/or affordability due to reduced
lender risk appetite and/or regulatory change
-- Team, skills and talent related risks regarding retention and change management
See above for the full list of principal risks together with
detailed descriptions.
Disciplined strategic planning process
The prospects for the Group are principally assessed through the
annual strategic planning review process conducted in October each
year. The management team from each of the Group's house building
businesses produce a five year business plan with specific
objectives and actions in line with the Group's strategy and
business model. These detailed plans reflect the development skill
base of the local teams, the region's housing market, strategic and
on market land holdings and investments required to support their
objectives. Special attention is paid to capital management through
the period to ensure the appropriate level of investment is made at
the appropriate time to support delivery of the plan. Emerging
risks and opportunities in their markets are also assessed at this
local level.
Senior Group management review these plans and balance the
competing requirements of each of the Group's businesses and
allocates capital with the aim of achieving the long term strategic
objectives of the Group. The five year plans provide the context
for setting the annual budgets for each business for the start of
the new financial year in January, which are consolidated to
provide the Group's detailed budgets. These budgets are updated
after six months, for the following twelve months, which are then
replaced by the new strategic planning, and budget setting, cycle.
The Board review and agree both the long term plans and the shorter
term budgets for the Group.
The outputs from the business planning process are used to
support impairment reviews, for funding projections, for reviews of
the Group's liquidity and capital structure, and identification of
surplus capital available for return to shareholders via the
Group's Capital Return Plan, resulting in the payment of dividends
to shareholders.
Assessing Persimmon's viability
The Directors have assessed the viability of the Group over a
five year period, taking into account the Group's current position
and the potential impact of the principal risks facing the
Group.
The use of a five year time horizon for the purpose of assessing
the viability of the Group reflects the business model of the
Group, new land investments generally taking at least five years to
build and sell through, and for the development infrastructure to
be adopted by local authorities.
A key feature of the Group's strategy launched in early 2012 and
documented in the Strategic Report is the Group's commitment to
maintain capital discipline over the long term through the housing
cycle. On launch, this commitment was reinforced with the
announcement of the Group's Capital Return Plan ("CRP"). The CRP
initially committed to return GBP1.9bn of surplus capital over the
following ten financial years to 2021, or GBP6.20 per share. After
seven years the Group is ahead of plan and has paid GBP7.20 per
share, or GBP2.22bn back to shareholders. On 25 February 2019 the
Directors announced the scheduled Capital Return Plan payments in
respect of the financial year ended 31 December 2018. Further
details can be found in the Operational Review earlier in this
announcement.
On an annual basis the Directors review financial forecasts used
for this Viability Statement as explained in the disciplined
strategic planning processes outlined earlier. These forecasts
incorporate assumptions about the timing of legal completions of
new homes sold, average selling prices achieved, profitability,
working capital requirements and cash flows, and are designed to
test the Group's ability to fulfil its strategic objectives. They
also include the CRP. The Directors have made the assumption that
the Group's revolving credit facility is renewed during the period
having again extended the maturity of the facility during the year
to 31 March 2023.
The Directors have also carried out a robust assessment of the
principal risks facing the Group (as set out above), and how the
Group manages those risks, including those risks that would
threaten its strategy, business model, future operational and
financial performance, solvency and liquidity. The Group has
considered the impact of these risks (particularly those in
relation to the cyclicality of the UK housing market and the
economic environment) on the viability of the business by
performing a range of sensitivity analyses including severe but
plausible scenarios materialising together with the likely
effectiveness of mitigating actions that would be executed by the
Directors.
These scenarios included the stress testing of the Group's
business model assuming that a combination of events resulted in a
severe recession, with a deterioration in employment levels and
consumer confidence, coupled with a collapse in bank risk appetite,
leading to a material reduction in credit availability. In
undertaking the stress testing, the Directors assumed a rapid
change in circumstances over a relatively short period of time so
as to test the strength of the mitigating actions available to
address the stress exerted on the Group's business model. In total
it was assumed average selling prices fell by c. 20% over an
initial three year period, during which time it was also assumed
that sales volumes fell by over 40%, before the market was assumed
to stabilise and then gradually move into a recovery phase. Due to
the combined effect of these factors the Group's housing revenues
were assumed to fall by c. 54% during this period. The stress tests
and mitigation were guided by the experience gained from the
management of the business through the Global Financial Crisis from
2007 to 2010. Cash flows were assumed to be managed consistently
ensuring all appropriate investment was made in the business at the
appropriate time as a priority. The Directors assumed they would
make the most appropriate decisions regarding returning surplus
capital to shareholders through this period to ensure the strategic
objective of minimising financial risk through the cycle was
achieved. The payment of the "regular" element of the CRP in early
July each year was maintained. This stress testing of principal
risks materialising also considered the potential for costs of
exceptional charges and asset impairment to arise.
Based on this assessment, the Directors confirm that they have
reasonable expectation that the Group will be able to continue in
operation and meet its liabilities as they fall due over the period
to the end of 31 December 2023.
* The Directors have assessed the longer term prospects of the
Group in accordance with provision C.2.2 of the UK Corporate
Governance Code 2016.
Statement of Directors' Responsibilities
The Statement of Directors' Responsibilities is made in respect
of the full Annual Report and the Financial Statements not the
extracts from the financial statements required to be set out in
the Announcement.
The 2018 Annual Report and Accounts comply with the United
Kingdom's Financial Conduct Authority Disclosure Guidance and
Transparency Rules in respect of the requirement to produce an
annual financial report.
We confirm that to the best of our knowledge:
-- the Group and Parent Company financial statements, contained in the 2018 Annual Report and
Accounts, prepared in accordance with the applicable set of accounting standards, give a true
and fair view of the assets, liabilities, financial position and profit or loss of the Company
and the undertakings included in the consolidation taken as a whole; and
-- the Strategic Report includes a fair review of the development and performance of the business
and the position of the issuer and the undertakings included in the consolidation taken as
a whole, together with a description of the principal risks and uncertainties that they face.
We consider the Annual Report and Accounts taken as a whole, is
fair, balanced and understandable and provides the information
necessary for shareholders to assess the Group's position and
performance, business model and strategy.
The Directors of Persimmon Plc and their function are listed
below:
Roger Devlin Chairman
Dave Jenkinson Group Chief Executive
Mike Killoran Group Finance Director
Nigel Mills Senior Independent Director
Marion Sears Non-Executive Director
Rachel Kentleton Non-Executive Director
Simon Litherland Non-Executive Director
By order of the Board
Dave Jenkinson Mike Killoran
Group Chief Executive Group Finance Director
25 February 2019
The Group's Annual financial reports, half year reports and
trading updates are available from the Group's website at
www.persimmonhomes.com/corporate.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
FR DDGDDGBDBGCU
(END) Dow Jones Newswires
February 26, 2019 02:01 ET (07:01 GMT)
Persimmon (LSE:PSN)
Gráfica de Acción Histórica
De Mar 2024 a Abr 2024
Persimmon (LSE:PSN)
Gráfica de Acción Histórica
De Abr 2023 a Abr 2024