Persimmon revenues falter as it focuses on quality over volume

Shares in the housebuilder Persimmon (LSE: PSN) were up very slightly today on results which on the face of it aren’t that great. The company revealed in a trading update that full-year revenue had fallen 2.4% to £3.65bn. But it expected pre-tax profits to be in line with expectations. The decline was down to its ongoing initiatives to improve build quality.

An independent review last month slammed the housebuilder’s quality of homes. A report has also called for an overarching change in the company’s culture. Its reputation has been battered ever since the awarding of a £75m bonus to the previous chief executive, Jeff Fairburn.

The group completed 15,855 home sales, compared with 16,449 the previous year.

Dave Jenkinson, the chief executive who took over from Jeff Fairburn said Persimmon was making good progress with its plan to improve customer care, which included “putting customers before volume”.

It was also announced that Claire Thomas has notified the board of her wish to step down as a Non-Executive Director and will leave Persimmon on 1st February 2020. She only joined the board in August 2019.

Persimmon’s smaller rival Bovis Homes, which has renamed itself Vistry Group (LSE: VTY) after the recent acquisition of Linden Homes from Galliford Try, released a more upbeat set of figures. It also has in the not so distant past recovered from its own scandal over poor build quality. It completed 3,867 homes last year, up 3%, and said it would slightly exceed City forecasts of a profit before tax of £181.6m.

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