Persimmon Regulatory News (PSN)

25 Jun 2007 07:02

Persimmon PLC25 June 2007 TRADING UPDATE - MONDAY 25TH JUNE 2007 Persimmon plc announces the following trading update ahead of its InterimResults to 30th June 2007, which will be announced on Tuesday 21st August 2007. The first half of 2007 has been another successful period for Persimmon. Duringthe last six months we have continued to focus on the improvement of marginsfollowing the completion of the acquisition of Westbury last year. During the period we will have completed c. 8,000 units (H1 2006: 8,226) in linewith our expectations. Total sales revenue will be c. £1.5 billion. Our recordof achieving industry high margins consistently over many years has continued.We have achieved operating margins in the period of over 20.5% which is anincrease on the margins achieved in the same period last year (H1 2006: 19.9%). Despite the back drop of a rising interest rate environment the housing markethas continued to operate in a similar manner to 2006. The new homes marketspecifically has remained active but competitive in the first half of 2007. Wehave been achieving an increase in the weekly sales per site. This has beenoffset by having a reduced number of outlets in the first few months of thisyear due to planning delays. However, we have increased outlets recently which has delivered an increase insales volumes over the comparative weeks of June last year. In addition,cancellation rates are at low levels and visitor levels to our sites remainencouraging. We expect this trend to continue during the second half as weincrease outlets further with a consequent increase in overall volumes in thesecond half of 2007 and 2008. As at 30th June 2007, we expect our forward sales position for the second halfof 2007, to be at c. £950 million (June 2006: £882 million). This puts us in avery strong position to achieve our full year expectations. The last six months has been another interesting period for the sector. Wecontinue to consider every opportunity to grow our business whilst ensuring thatwe invest where this is in the best interests of the business and shareholdersin the medium and long term. Currently we have a landbank of c. 82,000 plotsowned and under control. We are confident that we will continue to strengthenour landbank further as we achieve future successes with the promotion of ourlarge strategic land holdings. This will provide the necessary platform toincrease volumes ensuring that the profitable growth of the Company continues. Average gearing for the first half has been at c. 50% whilst at the period end,30th June 2007 gearing will be c. 33%. Our Balance Sheet remains in a verystrong position. Recent interest rate rises have had the desired effect and the housing market isstable with only moderate price growth. Employment prospects and customerconfidence remain good, and as a result the market has continued to beresilient. In the absence of any major change to the UK economy we expect thissituation to continue. We have a strong forward order book, an increasing number of outlets coming onstream, an excellent landbank including significant strategic land holdings, andan experienced and focussed management team. We are therefore confident of ourability to deliver growth in line with our expectations and of the excellentprospects for the Group over future years. Further details will be announced at the announcement of our Interim Results onTuesday 21st August 2007. For further information, please contact:Persimmon plcTel: +44 1904 642 199 John White, Group ChairmanMike Farley, Group Chief ExecutiveMike Killoran, Group Finance Director M:CommunicationsEd Orlebar:+44 (0)20 7153 1523 / +44 (0)7738 724 630orlebar@mcomgroup.com Charlotte McMullen:+44 (0)20 7153 1549 / +44 (0)7921 881 800mcmullen@mcomgroup.com This information is provided by RNS The company news service from the London Stock Exchange