Strong results for Vistry and Persimmon

Vistry and Persimmon has announced final results for 2021 today, with both showing increases in completions, revenue and profit.

In announcing its results, Vistry gave its backing to HBF’s response to housing secretary Michael Gove on a proposed plan to remediate cladding and tackle fire safety. The firm said the additional costs of implementing the recommendations could be in the range of £35 million to £50 million. The firm has also made a total provision for known liabilities of £25.2 million.

Vistry cited “excellent” progress and pre-tax profit for the year of £319.5 million, more than three times the 2020 figure of £98.7 million. Once adjusted for exceptional items profit increased 140% to £346 million. Vistry Housebuilding increased completions to 6,551 from 4,652 and margin up to 22.3% (17.6%). Vistry Partnerships meanwhile delivered “rapid growth in higher margin mixed tenure revenues” up 66% in 2021. Partnerships’ mixed tenure completions increased by 41% to 2,088.

Persimmon meanwhile said it had set aside £75 million for cladding rectification works on 33 developments – it is extending its search for affected buildings back 30 years but does not expect the number of buildings to change materially.

Persimmon profit before tax rose 23% to £973 million while completions rose 7% to 14,551 with group revenue reaching £3.61 billion (2020: £3.33 billion).

Persimmon ceo Dean Finch said the firm’s performance was strong in 2021. “We delivered more homes, built better and strengthened our platform for future growth. Maintaining build rates at pre-Covid levels, we delivered almost 1,000 additional new homes, and improved customer service.

“An agile approach across the business ensured we navigated the supply chain challenges posed by the pandemic, with our Brickworks, Tileworks and Space4 manufacturing facilities providing security of supply for essential materials and helping us maintain our operating efficiency. We will significantly expand production capacity at our Brickworks and Tileworks facilities this year and invest in a new Space4 timber frame facility.”

At Vistry revenue was up 30.2% to £2,359 million.  It has seen strong demand across all areas of the business during 2021, with the group’s average weekly private sales rate per outlet increasing to 0.76 (2020: 0.53).  Vistry saw pressure on the materials supply chain in 2021, resulting in extended lead times and inflationary pressures.  “Working in close partnership with our suppliers, we have actively managed this situation,” said Vistry.

Vistry chief executive Greg Fitzgerald’ said: “Notwithstanding the shocking events in Europe and the attendant political uncertainties, 2022 has got off to an incredibly positive start and the group is in great shape to deliver on its strategy of maximising the strengths and opportunities from the valuable combination of our Housebuilding and Partnerships businesses, and on achieving sector leading returns in the medium term.”