Persimmon Share Discussion Threads

[beckers2008] 10/8/2023 13:00

'Sikhthetech'

If the results are as bad as predicted, why is the share price up over 3%?

You must have got so badly burnt on your short call in October 2018, otherwise you wouldn't be here for 5 years being wrong, lol, just lol!

[sikhthetech] 10/8/2023 12:39

The results were bad as predicted.

They've more than doubled the incentive level to try and gain sales. Incentives cost money, impacting the margins and therefore profit and cash.
(3.2% incentive level compared to H2's 1.5%)
If a business offers to pay your mortgage for 12 months, who wouldn't like it?

Why would they double the incentive level if sales were going well?

Cash is down 50% compared to H1 2022 and so they have increased revolving credit.

Underlying operating margins down 1/2 to just 14%
Cash down 50%
pbt and eps around 1/3 compared to last year


From update:
"Average incentive levels of 3.2% in the period on the Group's private sales (H2 2022: 1.5%)"
"Cash at 30 June 2023 of GBP357m, after GBP192m in dividend payments"
" New revolving credit facility signed in July, increasing to GBP700m and extending to July 2028; includes sustainability-linked metrics"



Underlying new housing gross margin(2) 21.5% 31.0%
Underlying operating profit(3) GBP152.2m GBP440.7m
Underlying operating margin(4) 14.0% 27.0%
Profit before tax GBP151.0m GBP439.7m
Earnings per share 34.4p 106.5p
Interim dividend per share 20p -
Cash at 30 June GBP0.36bn GBP0.78bn



sikhthetech - 07 Jul 2022 - 16:22:15 - 2901 of
I wouldn't buy any HB at the moment...
Affordability issues still mounting up with energy cap set to rise to around £3000 pa in Oct, inflationary pressures pushing up interest rates.

House prices slowing which happens before a crash..

It's nice to have an investment decision proven right so conclusively by events.

[kanwar] 10/8/2023 09:21

Markets like it.

[cupra kid] 10/8/2023 09:05

Persimmon are very self sufficient and build more social housing than any other of the major house builders. There's been an obvious downturn but they will be in prime position to alleviate any risk.

[adamb1978] 10/8/2023 08:39

Good set of figures, and H2 probably not going to be markedly different.

Important to remember that price bottoms before earnings, so I think this has bottomed

[garycook] 10/8/2023 07:22

Trading highlights

-- 4,249 new home completions in H1 (2022: 6,652), reflecting the lower forward order book coming into the year following the market challenges after last Autumn's 'mini-Budget'

o Group private average selling price of GBP288,327, up 8% year on year, partially reflecting a greater proportion of larger homes sold

o Group average selling price of GBP256,445 up 4% year on year

-- Sales rate of 0.59 for the period (2022: 0.91), broadly sustaining the higher than expected rates seen in the first quarter and secured with the controlled use of incentives and investor deals

o Average incentive levels of 3.2% in the period on the Group's private sales (H2 2022: 1.5%)

o Investor deals accounted for 0.03 of the sales rate in the period; continue to assess approaches from interested parties on a case-by-case basis

-- Cash at 30 June 2023 of GBP357m, after GBP192m in dividend payments and GBP182m of land creditors paid in the period

o Continued close WIP and cost control, to manage cash and margins while maintaining capability for upturn

o New revolving credit facility signed in July, increasing to GBP700m and extending to July 2028; includes sustainability-linked metrics

-- Interim dividend of 20p per share to be paid on 3 November 2023, to shareholders on the register on 13 October 2023

Operational highlights

-- Maintained five-star customer satisfaction rating for second year running and have made good progress on our Trustpilot scores

-- Excellent progress on build quality with a c.50% reduction in Reportable Items(6) over the last year; building homes customers can rely on at a price they can afford

-- Continued targeted investment in vertical integration through a new Space4 factory and TopHat, a modular home manufacturer

-- Maintained positive progress on building safety remediation programme; many active tenders and works on-going; 36 of 80 developments completed; GBP350m provision announced in March remains unchanged Interim Dividend of 20p, giving 80p annual, and a 7.12% yield.

[beckers2008] 09/8/2023 22:33

'Sikhthetech'

Psn is going to be the most pessimistic update from the Big 4 House builders tomorrow morning.

TW. the most compelling investment in the HB's Sector, as I have alluded to... and so too have the Investors Chronicle and one more l
Journo!

You have lost the argument, lol, just lol!

It's all in price!

[sikhthetech] 09/8/2023 21:55

PSN reporting tomorrow.

I expect it'll be similar to other HBs, completions down, margins down, impacted by Help to Buy closing etc...

[fuji99] 09/8/2023 14:24

As China deflation may add more pressures on its growth, there will be a domino effect to the economies in the West. This will be felt particularly by house builders and retailers. If interest rates are staying too high while job creation stagnates, it will become riskier to buy a house or a luxury item. IMO home builders will suffer throughout 2023/24. Not the time to buy this sector as every bad news will directly affect the share price on a daily basis. I cannot see any coming positive that will keep the share prices at levels where they are now.

[sikhthetech] 09/8/2023 14:13

Bellway:
as predicted....
housing completions expected to 'decrease materially'.



Bellway cuts jobs in anticipation of UK property market slowdown
Prospect of higher mortgage rates and end of help to buy scheme leads housebuilder to shut two divisions

"Bellway, one of Britain’s biggest housebuilders, has said it is cutting jobs as it anticipates a property market slowdown in the coming year because of higher mortgage rates and the closure of the help-to-buy programme in March.

The construction company said it would shut two of its divisions and slow activity in a third, as it predicted that house completions would “decrease materially” over the next 12 months."




sikhthetech - 07 Jul 2022 - 16:22:15 - 2901 of 3086 PERSIMMON PLC
I wouldn't buy any HB at the moment...
Affordability issues still mounting up with energy cap set to rise to around £3000 pa in Oct, inflationary pressures pushing up interest rates.

House prices slowing which happens before a crash..

As with my previous prediction for previous housing crash, I'm expecting house prices to fall around 40%, peak to trough. Not all areas/streets will see the big drops... Asking prices fall the greatest. New builds usually command a premium and that would be reduced significantly during a crash.

Watch the supply increase and the demand decrease...
;-)

[the_jitters] 09/8/2023 12:12

So let me ask you again Sikh, at what point do you consider all the bad news in with house builders (PSN in particular as their share price has suffered more than most) and would you consider them a buy. To be fair you’ve called the downturn very well over time but it can’t and won’t go on forever.

[sikhthetech] 09/8/2023 11:35

From Bellway TU.
HBs newsflow, as expected



From Bellway TU.

HB newflow has been as expected.

margins down
avg selling price down
demand down.


Margins down, demand down as predicted.
HBs impacted by end of Help to Buy, where properties using that scheme had to be completed during H2. Therefore, further impact expected going forward.
Private reservations down a massive 35.9%

Avg selling price down.

HB incentives impacting margins.

Affordability a major problem


from TU
"The underlying operating margin is expected to be around 16%(3) (2022 - 18.5%), with the reduction reflecting the effect of build cost and overhead inflation, extended
site durations and the increased use of targeted sales incentives."

"The Group's programme of accelerating the construction of social homes partially offset weaker private demand, which was impacted by higher mortgage rates and the end of Help-to-Buy."

"The overall reservation rate reduced by 28.4% to 156 per week (2022 - 218) and the private reservation rate decreased by 35.9% to 109 per week (2022 - 170)."

"The backdrop of macroeconomic uncertainty and cost of living pressures affected consumer demand during the year and, given affordability remains constrained by higher mortgage interest rates, underlying trading conditions are likely to remain challenging in the near term."

"Total housing completions of 10,945 homes (2022 - 11,198), at an average selling price of GBP310,000 (2022 - GBP314,399)."

[sikhthetech] 08/8/2023 16:26

Bellway reporting tomorrow, PSN on Thurs.

[blue59] 08/8/2023 16:21

uu4 - Bon voyage!

Don't worry about staying in touch.

[the_jitters] 08/8/2023 14:41

Ok, so we all know PSN has performed poorly but it’s performed well below both Barrat and TW. This is now just a third of the price it was at its highs………. And we all know at some point the housing market will recover. My question is simple, at what point do we consider all the bad news priced in and consider PSN a buy?

[beckers2008] 07/8/2023 23:00

'Sikhthetech'

'Spotted by Sunshine Today on TW thread'

YOU posted it, numb-nuts, you really are the village idiot, lol, just lol!

[sikhthetech] 07/8/2023 21:34

Spotted by Sunshine Today on TW thread.


There you go, end of Help to Buy impacting the HB sector. As expected then.
Berkeley, TW, Bellway - all big UK housebuilders warning of a slump in demand.



"In response to current market conditions which have caused a slowdown in the sales market and a reduced output for house building, we have today announced proposals to make some structural changes across our business," the company said in a statement.

"This includes the potential closure of two of our operating divisions, with sites being transferred to other divisions, a reduction in capacity in a third division and a limited number of role reductions across the business."

"It is the latest sign of a slump in the housebuilding sector, which is grappling with high interest rates and a cost of living squeeze that is dampening demand."


"The end of the government's Help to Buy scheme in England is also weighing on the sector."

"It came two months after Taylor Wimpey announced that it was planning to cut jobs in order to find savings of £20m a year.

Meanwhile, Barratt announced in July that it would build 20% fewer homes in 2024, while Berkeley said its annual sales were expected to fall by a fifth."

[uu4] 07/8/2023 00:06

If the masonic disorders links to tax avoiding tax payer robbing landlords post 2008/9 is not exposed and put right in tax payers favour I am leaving this corrupt ignorant country. What was that all about. Your industry is completely rescued by tax payer SO what do directors do? Pay themselves bonuses!!!! Then after few years after checking the temp. Crown Estate do same. You people are so corrupt. It's off the scale . Is this 1930's Germany?
What happened to states ability to build clean energy producing infrastructure??????
Ans: stupid masonic politicians paid it to stupid corrupt builders , tax avoiding property owners/landlords BECAUSE that's what we do in medieval England!
What is the difference between this and Putin's thieving tax avoiding oligarchs. Banks fall over to help them too or you end up in Lublianka.
Here nobody is allowed do the right thing for the wider economy because theft by builders/tax avoiding landlords is democracy apparently!!
The oligarchs made Putin and tax avoiding landlords made you

[tialouise] 02/8/2023 14:55

Thank you dear, bye now........

[sikhthetech] 02/8/2023 14:14

TW H1 results not good. Shows sector still suffering.


TW:
The divi is simply because they have committed to a divi policy, which they previously restated they will stick to.
That is a bad policy in a downturn as they can quickly run out of cash.

Plus directors would want that additional income.

Increased the revolving credit to £600m and now includes new conditions!!


Group completions down at 5,120 against 6,922. That includes completions for homebuyers who bought using Help to Buy before it ended, where it was important to complete during H1, otherwise they would not be paid.

Group profit margin down. Increases in labour and falling house prices would severely impact that lower margin.

Been good trading these.
I think best to trade.


From the results:

-- Group completions of 5,120 homes (H1 2022: 6,922)
-- Group operating profit margin of 14.4% (H1 2022: 20.4% ), reflecting a lower level of completions and the impact of build cost inflation which was not fully offset by house price inflation for the period

-- Announced 2023 interim dividend of 4.79 pence per share (H1 2022: 4.62 pence per share) amounting to GBP169 million (H1 2022: GBP163 million), in line with our stated Ordinary Dividend Policy to return 7.5% of net assets annually

-- Full year UK completions excluding JVs now expected to be in the range of 10,000 to 10,500, at the upper end of our previous guidance with full year Group operating profit including JVs expected to be between GBP440 million and GBP470 million

-- Ended the period with net cash of GBP654.9 million (H1 2022: GBP642.4 million)
-- Renewed revolving credit facility in July 2023, increasing it to GBP600 million and extending maturity to July 2028. The new facility includes sustainability linked performance measures

[beckers2008] 01/8/2023 20:09

Sikhthetech'

Our resident pessimistic village idiot, lol!
I see you pos TLY is below where I told you it would be,

'Sikhthetech'
What was the average house price in October 2018 when you were calling a crash, compared to now.
Considerably less, lol!

You are a clueless mug-punter losing over 30% in a day, lol, just lol!

You should be watching the 'House of the future' on BBC1. You may learn something!

[time 2 retire] 01/8/2023 17:24

Sikh, less than 4% drop YOY, still nowhere near the 40% you predict.

[sikhthetech] 01/8/2023 16:11

affordability still a major problem.


UK house prices fall at sharpest rate for 14 years, says Nationwide

UK house prices dropped at their fastest annual rate for 14 years in July, according to Nationwide.

The building society said prices had dropped by 3.8% - the biggest yearly decline since July 2009.

Nationwide said mortgage interest rates remained high, making affordability a challenge for house-buyers.

"The average price of a home in the UK is £260,828, said Nationwide which is about £13,000 below a peak in August last year."