Help-to-Buy fuels rise in Persimmon's profits

Sebastian McCarthy
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Housebuilder Persimmon reported a 13 per cent rise in profits in the six months to the end of June (Source: Getty)

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 bre​akneck speed attained last year."

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