Housebuilders unveil strong profits growth

By GARETH MACKIE
Published on 25/02/2013 08:33

Two of the UK’s largest housebuilders have reported strong growth in full-year profits as the industry benefits from government schemes to help people get on the housing ladder.

Persimmon, the country’s biggest builder by market value, said underlying pre-tax profits in the year to December jumped 52 per cent to £225.1 million, on revenues 12 per cent higher at £1.7 billion.

The number of legal completions grew by 6 per cent to 9,903, with the average selling price rising by the same margin to £175,640.

Shareholders are due to receive a payment of 75p per share on 28 June under the first phase of Persimmon’s long-term capital return plan.

Separately, rival Bovis Homes posted a pre-tax profit of £54.1m for 2012, a jump of 69 per cent compared with the previous year, as revenues grew 17 per cent to £425.5m.

Bovis said it had enjoyed a 15 per cent increase in legal completions to 2,355 homes and its average selling price grew 5 per cent to £170,700.

The firm’s board proposed a final dividend of 6p per share, to be paid on 24 May. That will give a total payout for the year of 9p per share, which is up 80 per cent on 2011.

Builders have benefited from their strategy of snapping up cheap development land at the depths of the financial crisis, while sales have also been boosted by schemes such as Funding for Lending and New Buy, which seek to free up mortgage lending and make it easier for people without a large deposit to buy new houses.