Housebuilder Persimmon’s profits top £1bn

Housebuilder Persimmon has reported annual profits of £1.091bn and named Dave Jenkinson as chief executive after last year’s row over his predecessor.

The firm’s previous chief executive, Jeff Fairburn, left last year following a row over his £75m pay package.

The results come a day after shares in Persimmon fell 5% fell due to questions over its continued involvement in the Help to Buy scheme.

The firm sold 7,970 homes under the scheme in 2018, up from 7,682 in 2017.

At the weekend, a source close to Housing Minister James Brokenshire said he was “increasingly concerned” by Persimmon’s practices, including its use of leasehold contracts, the quality of its buildings and its leadership.

He said this meant its inclusion in the Help to Buy scheme was under review.

Mr Jenkinson had been interim chief executive since in November, following Mr Fairburn’s departure.

He 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.”

‘Pursuit of excellence’

Chairman Roger Devlin 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.”

The company’s total group revenue for the year increased by 4% to £3.74bn, up from £3.60bn in 2017.

Mike Amey, managing director of global investment management firm Pimco, told the BBC that profit per household at Persimmon had trebled since Help To Buy was introduced.

And housing expert Henry Pryor told the BBC: “There is no doubt that Help to Buy has been the crack cocaine of the housing industry. We’ve all got addicted to it and when we are weaned off it, it is going to be painful.”