PERSIMMON is to unveil 14 new sites in Scotland this year as the housebuilding giant hailed a strong order book for the months ahead.
Shares in the company rose despite a fall in revenue revealed in its final results for last year because of coronavirus restrictions.
The firm saw its profits drop by a quarter in 2020 to £783.8 million as the pandemic affected the number of new houses it could build.
It said 13,575 homes were completed during last year, down by nearly 2,300 from 2019, contributing to an almost nine per cent fall in revenue to £3.33 billion.
The York-based company said new home completions in Scotland were down by around 25% last year compared to the previous year, which reflected the three-month shutdown north of the Border. It is not disclosing the locations of the new sites yet, it said.
The company cut its dividend from 235p per share to 110p per share.
READ MORE: Housebuilder hails forward sales surge
However, the business said that 2021 looks brighter. Its build rates have been at pre-Covid levels since July, while forward sales are 15% up on last year and private weekly sales were 7% up in the first eight weeks of the year.
The company kicked off the year on a better footing than last year as Government and Bank of England policies helped boost the housebuilder.
Forward sales are at £2.3bn, largely because of the low interest rates, the availability of mortgages and the Government support.
Persimmon is also to benefit from the Covid-19 stamp duty holiday extension, which has seen thousands of pounds of tax burden lifted from buyers.
Dan Lane, an analyst at Freetrade, said: “Persimmon has been a huge beneficiary of the Help to Buy scheme and, judging by the Chancellor’s plans today, it plans to keep riding the Government support wave.”
He added: “There’s the potential for public outcry in all of this though. These Government schemes may have got young people in particular on to the property ladder but they didn’t do it by actually tackling inflated prices.”
Dean Finch, chief executive, said: “Persimmon delivered a robust performance in 2020 despite the challenges presented by the pandemic.
“We have also set new environmental targets in line with the Paris Agreement and will seek to further develop the Persimmon way to embed the specific measures that will deliver on these targets in the future.
“In addition, having adopted the principles of the Living Wage Foundation within our direct pay policies we are seeking full accreditation in working with our broader supply chain and development partners."
He said: “Persimmon is a company of many strengths with great opportunities ahead. Combining the business’ entrepreneurial spirit and astute land buying with enhanced quality, efficiency and service standards will drive superior, sustainable value creation for our shareholders and broader stakeholders alike.”
The group’s average private weekly sales rate per site for 2020 was 12% higher year on year “reflecting good stock availability coming into the year and strong customer demand”, it said.
READ MORE: Cladding fund set up post-Grenfell
Ben Nuttall, senior analyst at Third Bridge, said that “record sales in the second half mitigated production down 50% in the second quarter”.
He added: “Something that Persimmon won’t escape dealing with will be new environmental building regulations, which are expected to add around £5,000 to each house build.”
Persimmon is also setting aside £75m towards any necessary remediation work to remove now-banned cladding on multi-storey developments it built.
It said where Persimmon owns the building, it will lead the work, or if it no longer owns the building it will "support the owners and other parties in their efforts to ensure the buildings are safe for residents".
Shares in Persimmon closed at 2,895p, up 6.83%, or 185p.
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