Persimmon

Ticker PSN

Today's data summary

Market closed
% change
-3.22%
Price Pence
1622.50
Change
-54.00
As of 22:38 03 Apr 2020
Market cap. Pound sterling
5,174.63 million
As of 22:38 03 Apr 2020

Latest updates

'Cracks starting to show' at Persimmon

House being built by Persimmon
Getty Images

More on the news that the UK housebuilder's chief executive is to stand down.

Julie Palmer, partner at Begbies Traynor says "the company's reputation is continuing to show cracks as reports of customer complaints are rife", with concerns over build quality.

"This has ultimately led to Dave Jenkinson’s departure and his replacement will need to rebuild the company’s image in the wake of an independent review that reported a failure to install fire-stopping cavity barriers in properties causing a wave of customer complaints.

She added: "Persimmon will need to find someone who has the right tools to fix the crisis and shareholders will be concerned with the potential impact on the company’s figures. With the Help to Buy scheme now in its last year, which has been a source of much revenue, if this ongoing struggle for customer satisfaction is not sorted by the new boss, the housebuilder’s results will eventually take a beating."

Persimmon boss to step down

Persimmon Homes
Getty Images

The chief executive of UK housebuilder Persimmon, David Jenkinson, who has been with the firm for 23 years, is to step down as group chief executive.

The news came as the company announced a drop in full-year profits to £1.04bn from £1.09bn the year before.

Persimmon came in for criticism last year over the quality of its houses. An independent report commissioned by the firm found that Persimmon did not have an agreed minimum standard for all the homes it builds.

Mr Jenkinson joined Persimmon in 1997 and previously held posts as regional managing director, north division chief executive and group managing director.

Persimmon chairman Roger Devlin said that under Mr Jenkinson's leadership "Persimmon has invested in a range of customer care and quality initiatives, prioritised customers over volume, became the first UK housebuilder to implement a retention policy and will achieve an HBF 4-star rating".

"Throughout this period of significant change, the operational performance of the business has remained strong."

Persimmon sees revenues fall after it improves quality

Persimmon sign
Reuters

The number of homes built by Persimmon in the last year fell by 4%, hitting revenues.

The company is trying to improve the quality of its building work following a scathing report into its work practices.

Bosses were told that they were focusing too much on building as many houses as possible - but failing to ensure the homes were habitable for the long term.

Full-year revenues were £3.65bn in the 12 months to 31 December, down 2.4% compared with a year earlier.

The average selling price was just £137 more than a year ago at £215,700, the company added.

Persimmon 'lacks minimum house standards'

Persimmon house
Reuters

More on that damning report on Persimmon we mentioned earlier.

The independent report said the company does not have an agreed minimum standard for all the houses that it builds.

It said the lack of a group build policy increases the risk of defects.

One result is a lack of fire-stopping cavity barriers or ones which have been installed wrongly around the UK.

Chairman Roger Devlin commissioned the review in April to assess the impact of new processes to improve customer care and cut out cases of poor workmanship.

The review also said the company's corporate culture needed to change, that there were no agreed procedures to supervise or inspect its employees or sub-contractors' work and that staff were only given limited training.