Persimmon takes profits hit

National housebuilder Persimmon saw a massive drop in its first-half results, recording a 64% slide in its pre-tax profits to £100.9m.

The company posted a 34% fall in turnover to £998.4m and a 56% decline in operating profits to £139.7m.

A total of 5,501 units were completed during the six months, down 31%, with an average selling price of £181,485, which was down 4%.

This has been driven by the ongoing turmoil in the housing and financial sectors, and has necessitated a number of restructuring operations.

So far this year Persimmon has cut around 2,000 jobs, closed three offices, reduced its land purchases, postponed a number of new site starts and worked with suppliers and subcontractors to reduce build costs. The restructuring has cost £15m.

This has been coupled with a strong focus on developing affordable housing volumes and reassessing existing planning consents to improve the product mix and returns from its operations.

“We are confident that our business, having been restructured, is in a position to move forward whenever the market improves,” said group chairman John White.