Customer focus eats into sales at Persimmon
The house builder sold 6% fewer homes in the first half of the year, but consumer confidence is still resilient, it told the markets.
Persimmon has said its plan to put customers ahead of volume ate into the number of homes it sold over the last six months.
Sales of new homes fell 6% in the first half of the financial year, it revealed on Thursday. This was in large part down to a new policy of only selling homes to customers when they were closer to being fully built, said chief executive Dave Jenkinson.
Over the six months the number of sales it completed fell to 7,584 homes. It expects a similar effect in the second half of the year, although it is likely to sell more as the market is more active in autumn and winter.
“Persimmon’s top priority is the delivery of higher levels of quality and customer service through the implementation of its detailed customer care improvement plan. Central to this plan is putting customers before volume,” Mr Jenkinson said.
The house builder was a rare voice among its FTSE 100 peers, saying that consumer confidence “remained resilient” despite the uncertainty around Brexit. It said real wage growth and strong employment levels in the UK had propped up the housing market.
“We are mindful of the uncertainties facing the UK economy but remain keen to bring new developments through the planning system as promptly as possible to enable construction activity to commence and new homes to be delivered to the communities we serve,” the company said in a statement to the markets on Thursday morning.
It said the practice of forward selling, flogging a home well in advance of customers getting the keys, had fallen to around £950 million beyond 2019. This was a drop of £37 million from the same period last year.
It has bought 3,700 new plots of land in the period, spending more than £170 million.
Persimmon said its broadband packages, launched in the second half of last year, have attracted 3,350 customers.