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Persimmon records 57 rise in profits

Article By: ,  Financial Analyst
August 19, 2014 10:15 AM

Housebuilder Persimmon has enjoyed a rise in profits thanks to increased house price growth in the UK.

The company announced a 57 per cent rise in pre-tax profits for the six months to the end of June, hitting £208.9 million. This was compared to the £132.9 million recorded a year earlier and has been aided by the UK's housing market continuing its recovery. As the country achieves economic growth, companies within the sector have enjoyed some much more positive financial results.

Persimmon's announcement comes a day after Bovis Homes reported a 150 per cent rise in pre-tax profits to £49.4 million for the same period. The company had seen an increase in house sales thanks to a "modest" improvement in house prices. Bovis has benefited from a sharp rise in both quantity and value of the properties sold and this has been attributed to the recovery of the UK economy.

For Persimmon, new home sales were up 28 per cent to 6,048 while the average selling price of its properties was 4.3 per cent higher than a year, now standing at £186,970 compared to £179,199 12 months earlier. The company reported a 33 per cent increase in revenues for the first half of the year, growing from £900 million in 2013 to £1.2 billion.

The firm is now looking to a prosperous future and has already set out a number of key targets to reach for the coming years.

Announcing its financial results, Persimmon said: "We anticipate that mortgage lenders will continue to actively develop their participation in the UK mortgage market over the medium term.  A return to growth in monthly mortgage approvals in June this year, which was 14 per cent ahead of the prior year level, is encouraging.

"We welcome the continued discipline of mortgage lenders against the backdrop of the ongoing improvement in the UK's wider economic performance which is supporting increased confidence in our regional markets.

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