Help-to-Buy fuels rise in Persimmon’s profits
Persimmon reported a 13 per cent rise in pre-tax profits for the first half of 2018 yesterday, as boosts from low interest rates and the government’s Help-to-Buy scheme eased fears that the housebuilder would be hit by a slowdown in the property market.
Profits before tax rose to £516.3m in the six months leading up to the end of June, compared with £457.4m in the same period a year ago.
Completions also rose by four per cent to 8,072 homes and the average selling price increased by one per cent to £215,813. The rise in profits will come as relief to chief executive Jeff Fairburn, who has come under fire for a share price-linked bonus plan that could earn him a potential £100m payout.
Read more: House transactions slide lower amid 'stagnant' property market
Fairburn received £47.1m in 2017, making him the highest paid boss serving in any FTSE 100 company, according to a survey last week.
"Persimmon continues to supply the homes the country needs at a price they can afford, whilst at the same time offering investors a dividend yield of around 10 per cent," said Jeffries analyst Anthony Codling.
Laith Khalaf, senior analyst at Hargreaves Lansdown, said: "Things are still heading in the right direction at Persimmon, but the pace of progress is slowing from the breakneck speed attained last year."