Last checked at 8 Jan 2009 07:00
TRADING UPDATE - 8 JANUARY 2009
Persimmon plc announces the following trading update ahead of its Preliminary Results for the year ended 31 December 2008, which will be announced on Tuesday 3 March 2009.
Results for the full year will be in line with market expectations. We have legally completed 10,202 units at an average selling price of c. £172,000. This represents a turnover of c. £1.76 billion.
Our emphasis on cash control has resulted in a reduction of total borrowings at the year end to c. £600 million (June 2008: £906 million). As anticipated at the time of our Interim Results on 21 August 2008 we have generated good net cash inflow from operations through the second half of 2008. Close control of work in progress including the focus on sales of stock properties and over 50% reduction in part exchange holdings has resulted in this strong cash generation, despite the previously reported deterioration in trading conditions encountered from early September 2008. The year end borrowings are lower than originally anticipated due to the early receipt of tax repayment following the provisions announced in our Interim Management Statement on 27 October 2008.
Until there is an improvement in the restricted credit conditions currently experienced we will continue to focus on conserving cash. As a consequence the Board does not intend to pay a final dividend this year.
In addition, we have commenced discussions for the planned refinancing of the Group's credit facilities. Having made good progress, our bank syndicate and private placement investors are actively engaged in establishing facilities appropriate for the future needs of the business together with covenants reflective of current credit market conditions.
Whilst we believe that the long term future for the UK housing market remains good, the short term outlook is challenging. However, we currently have forward sales of c. £400 million.
Further details of the Group's performance for the year together with a general market update will be provided with the announcement of our Results for the year ended 31 December 2008, on Tuesday 3 March 2009.
For further information, please contact:
Persimmon plc
Mike Farley, Group Chief Executive
Mike Killoran, Group Finance Director
On 8 January 2009: +44 (0) 207 153 1533
Thereafter: +44 (0) 1904 642 199
M: Communications
Edward Orlebar: +44 (0) 207 153 1523 / +44 (0) 7738 724 630
Charlotte McMullen: +44 (0) 207 153 1549 / +44 (0) 7921 881 800
Marylene Guernier +44 (0) 207 153 1269 / +44 (0) 7776 303 788