Persimmon PLC
22 August 2006
22 August 2006
RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2006
Highlights
• Record pre-tax profits* up 16% at £271.5m (H1 2005: £234.9m).
• Earnings per share* grew by 15% to 64.4p from 56.2p for H1 2005.
• Proposed half year dividend to increase by 15% to 13.8p per share
(H1 2005: 12.0p).
• Turnover up by 42% to £1.5bn (H1 2005: £1.1bn).
• Home completions up by more than 38% to 8,226 units (H1 2005: 5,954 units).
Average selling price up 3% to £188,427 (H1 2005: £183,581). Underlying
original Persimmon volumes increased by 7%.
• Integration of Westbury acquisition completed ahead of expectations:
gearing reduced to 50% six months ahead of schedule - strong free cash flow
of £284m generated.
• Synergy savings from Westbury acquisition accelerated to £10m in the first
half with at least a further £20m expected in the second half. Savings in
excess of £40m expected for 2007 and beyond.
• Operating margin remains at industry leading level: operating margin
reduced from 23.0% to 19.9% following the acquisition of the lower margin
Westbury business.
• Land bank strengthened: total consented plots stands at 78,305 up from
62,157 in H1 2005, this includes c. 2,000 plots pulled through from our
strategic land bank.
• Strategic land portfolio: up by 22% to 23,210 acres (H1 2005: 19,102 acres).
• Healthy housing market: forward sales of c. £1.4bn already agreed.
*stated before one off reorganisation costs of £15.4m (2005: £nil).
John White, Group Executive Chairman said: 'The integration of Westbury has been
completed ahead of expectations and the group is well placed to take advantage
of a strong and stable housing market.
'Visitor levels to our sites remain good whilst volumes of sales reservations
and revenues are ahead of last year on a like for like basis. Currently total
sales revenues for the year 2006 including completions to date are at an all
time high of c. £2.9 billion. The high level of sales already achieved puts us
in a healthy position to achieve our volume expectations for the full year.'
For further information, please contact:
John White, Group Executive Chairman Faeth Birch
Mike Farley, Group Chief Executive Edward Simpkins
Mike Killoran, Group Finance Director Kirsty Flockhart
Persimmon plc Finsbury
Tel: +44 (0) 20 7251 3801 on 22 August 2006 Tel: +44 (0) 20 7251 3801
Tel: +44 (0) 1904 642 199 thereafter
A webcast of today's analyst presentation will be available on
www.persimmonhomes.com by 2pm today.
CHAIRMAN'S STATEMENT
INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2006
I have great pleasure in announcing another record set of results for Persimmon
for the 6 months ended 30th June 2006.
RESULTS
Net pre-tax profits for the period (stated before exceptional reorganisation
costs) were £271.5 million an increase of 16% (H1 2005: £235 million). During
the period we completed 8,226 units (H1 2005: 5,954) representing an increase of
more than 38%. Turnover was £1,550 million (H1 2005: £1,093 million) which is an
increase of 42% on the prior half year period. Operating profit was £309.1
million (H1 2005: £251.8 million) an increase of 23%, and earnings per share
increased 15% to 64.4p (H1 2005: 56.2p) (both stated before exceptional
reorganisation costs).
On 17th January 2006 we completed the purchase of Westbury for £664 million
(including costs) plus acquired debt of £422 million. The results announced
therefore include 5 1/2 months of trading from Westbury. The integration of
Westbury has been completed ahead of expectations and the Group is well placed
to take advantage of a strong and stable housing market.
I am particularly pleased to report that we have achieved an operating margin on
the combined business of 19.9% (before exceptional reorganisation costs) during
the period (H1 2005: 23.0%). Despite the expected dilution of Group margin
following the Westbury acquisition we continue to achieve margins at the top end
of industry levels. Prior to acquisition, Westbury's operating margin was 13.9%
and in decline. Our key objective post acquisition was leveraging Persimmon's
best practice and purchasing power, and by the half year we had successfully
halted the margin decline.
Debt levels were reduced significantly ahead of our original projections at the
time of the acquisition. Whilst we made land payments of c. £320 million during
the period, we also controlled work in progress tightly and applied strict
discipline to our stock levels. By doing so we generated a strong cash inflow
from operations of £417 million which delivered £284 million of free cashflow.
This reduced gearing to 50% by 30th June 2006, six months ahead of our plans.
During the period we also terminated an acquired Westbury Joint Venture
arrangement, Wescott. This action reduces future funding costs and gives us
greater control benefiting the overall outcome of the developments concerned.
Interest costs increased to £37.6 million (H1 2005: £16.9 million) reflecting
the extra debt taken on to fund the acquisition. ROACE was 25.0% compared with
28.8% for the full year of 2005. Interest cover was a comfortable 7.8 times (H1
2005: 14.9 times).
We are increasing the interim dividend in line with underlying earnings growth
by 15% to 13.8p per share. This is an expression of our confidence in the
success of our latest acquisition and in the future earnings capacity of the
Group. The interim dividend will be payable on 20th October 2006 to shareholders
on the Register at 1st September 2006.
As previously reported we took action to integrate Westbury quickly and
effectively in order to improve performance going forward. In doing so we
rationalised the enlarged business with the closure of 8 offices and c. 550 job
reductions. The cost of the reorganisation has largely now been incurred at a
one-off cost of c. £15 million. The synergy savings we expect to deliver from
the action we have taken will be in excess of £40 million per annum for 2007 and
beyond. In addition, by taking swift action we have accelerated the delivery of
the savings. For 2006 we originally forecast delivery of c. £25 million of
savings, with £5 million realised in the period to 30th June 2006, and the
balance during the second half of 2006. In fact we have achieved savings of £10
million to 30th June 2006 and are on course to deliver at least a further £20
million of synergy savings in the second half.
DIVISIONAL SPLIT
During the period we restructured our management teams to ensure that we
continue to apply our tried and tested discipline within the enlarged Group
whilst maintaining the ability to react quickly to changing market conditions
and challenges.
Mike Farley has taken over from me as Group Chief Executive following a very
successful period as Divisional Chief Executive of the original South Division.
Since his appointment he has overseen the integration of Westbury and the
implementation of the new structures with great effect.
We now operate from three geographic divisions each under the control of a
Divisional Chief Executive who presides over a Divisional Board. This divisional
structure has performed admirably throughout the period and is well set to
deliver good results over many years.
The new South Division, whose Chief Executive Nigel Greenaway (age 46) has been
with Persimmon since 1986, completed 1,866 units at an average selling price of
£192,911 (H1 2005: £186,191). Price per sq ft increased by 4% in the 12 month
period. Generally prices have held up well with a reduction in the use of
incentives. Margins have not been under as much pressure in this Division as
some other areas of the country and they have been maintained at the previous
high levels, whilst we continue to sell at good rates.
The new Central Division, whose Chief Executive David Thornton (age 49) has been
with Persimmon for 14 years, completed 2,968 units at an average selling price
of £168,147 (H1 2005: £169,582). Price per sq ft increased by 3% in the 12 month
period. Prices in this Division have generally been stable with some pressure on
margins in the north of its area of operation, whilst the Midlands has been
patchy. Currently sales rates are quite satisfactory for the time of year.
The new North Division, whose Chief Executive Jeff Fairburn (age 40) has been
with Persimmon for 16 years, completed 1,926 units at an average selling price
of £169,432 (H1 2005: £167,114). Price per sq ft increased by 1% in the 12 month
period. This Division covers Scotland, an area which has continued to trade
strongly. The North East of England has firmed up following a more difficult
trading period in the second half of last year. Elsewhere in the North the
market varies from challenging to stable whilst margins have generally remained
firm.
The Charles Church brand completed 1,466 units at an average selling price of
£248,731 (H1 2005: £279,014). This reduction in average selling price was
planned to accord with our strategy of broadening the product offering and is
also below the £250,000 threshold for stamp duty increases. This was mainly due
to the impact of a high proportion of Westbury sales particularly in the North
West and an increased number of sales in the North generally.
Charles Church volumes achieved in the first half puts us on target to complete
c. 3,000 units in a full year, as indicated earlier this year following the
Westbury acquisition. The gross profit per plot we have achieved with this brand
is at a higher level than that of the Core housing division although the margin
is lower. This represents good potential for improvement as we realise better
operating efficiencies as volumes increase and national coverage is achieved.
LAND
We have stated many times that land is the essential ingredient for house
builders and the attention and emphasis we have placed upon its acquisition and
control over many years has been and will continue to be key to our success.
Over recent years our strategy has been to acquire large land opportunities
where we saw best value. A number of those acquisitions are now being developed
having been carefully master planned over the past 2-3 years. For example, the
78 acre redundant brownfield site at Cape Hill Brewery in Birmingham which we
agreed to purchase for £26 million in 2003 now has planning for 836 homes and
will generate sales revenue of over £145 million. Development works are well
underway and the first release of homes for sale have been reserved very
quickly. We anticipate first occupations in September this year. Demand is very
strong and we expect the development to continue to produce good volumes and
margins for several years.
Similarly, the 97 acre ex Massey Ferguson plant site in Coventry which we agreed
to purchase in January 2004 for £22.5 million has been cleared and remediated.
Infrastructure works are well advanced and the first homes were offered for sale
last month with an excellent response from purchasers. We now have consent for
over 650 homes and 36 acres for B1/B2 commercial use at this location. The
expected gross revenue for the homes content will be in excess of £105 million
and all of the Group's brands will be active on site, Persimmon, Charles Church
and Westbury Partnerships.
The Group has a total landbank of 92,156 plots, a c. 5 year supply of which
78,305 plots are owned and under control with a further 13,851 plots where we
have agreed terms to purchase and are proceeding to contract. In addition we
control 23,210 acres of land in our strategic land portfolio. A large amount of
the strategic land acquired with Westbury has excellent potential and we are
confident it will provide a significant number of consented plots to our
landbank over future years. For example, we recently received a resolution to
grant planning consent for over 1,000 homes on an ex-Westbury strategic site at
Andover and a further c. 120 homes at Salisbury and look forward to bringing a
number of other sites on stream during the current year.
Additionally we are currently finalising the planning agreements to develop c.
800 homes in Bridgwater acquired with the Beazer acquisition having promoted
this land for development for many years. This shows once again the significant
benefits of our past corporate acquisition strategy.
Of course Persimmon also achieves successes on its other existing long term land
holdings such as the imminent conclusion of the planning negotiations for c. 630
homes plus 6 hectares of employment use at Old Sarum, Salisbury.
All of these strategic land holdings will be acquired at a discount to open
market value under the terms of our legal options therefore ensuring excellent
margins and again highlights the benefits of long term strategic planning and
investment.
We were also delighted to receive consent for 280 homes at Newcastle-under-Lyme
on land which was acquired by Beazer as part of a parcel of land holdings from
British Coal and is owned freehold at non-residential values.
Given the restrictive planning regime in the UK, it has been Persimmon's
long-held view that in order to compete effectively, provide certainty and give
us the flexibility we need to operate in all market conditions, we need to
maintain and build a long landbank with a good mix of long and short term land
opportunities. This has been one of the cornerstones of our success over the
years. Should Government initiatives prove successful in releasing extra volume
into the market, we will of course review our strategy and we are confident that
Persimmon is in an excellent position to react to any change in regulatory
environments.
SPACE4 AND SOCIAL HOUSING
We are excited by the benefits and opportunities emerging through the Westbury
Partnerships and Space4 businesses. We are supporting both these businesses with
our Group expertise and procurement strengths. We have given clear direction to
both these operations and by working closely together with Housing Associations
believe we can offer a solution to some of the affordable housing problems the
Government wishes to resolve.
Whilst there is still a way to go, we are pleased with the response we have
received to our initiative to provide a Modern Methods of Construction solution
to this problem. Already we are working closely on a number of land situations
with Housing Associations and associated land owners as well as refining house
types to supply the Space4 product to them at acceptable prices. We expect to
report further good progress with these initiatives in due course.
OUTLOOK
Visitor levels to our sites remain good whilst volumes of sales reservations and
revenues are ahead of last year on a like for like basis. Currently total sales
revenues for the year 2006 including completions to date are at an all time high
of c. £2.9 billion. In addition, we have c. 120 new outlets planned to open over
the next three months at a time when sales volumes usually increase following
the summer months. The high level of sales already achieved and the opening of
these new outlets puts us in a healthy position to achieve our volume
expectations for the full year. We do not however expect to see significant
selling price increases above those already realised this year. Therefore we are
redoubling our efforts to keep increases in build costs and overheads to a
minimum.
We have been encouraged by recent moves by the Government to improve the
planning process and we welcome the decision to reconsider the necessity for
full implementation of Housing Information Packs. The Bank of England's recent
decision to implement a quarter point rise in interest rates, effectively
reversing last August's cut, has had no tangible effect on our business or on
visitor levels or enquiries. These remain at healthy levels and employment
prospects remain good. For the majority of our homebuyers, decisions to move are
driven primarily by their family dynamics and therefore we expect this healthy
market to be sustainable.
Finally, I thank all our staff, new and old, for all their efforts, particularly
over the last few months during the integration period. I have no doubt that
thanks to their hard work we have a great platform for further profitable
growth.
22 August 2006 John White
Group Executive Chairman
PERSIMMON PLC
Consolidated Income Statement (unaudited)
Six months to Six months to Year to
30 June 30 June 31 December
Note 2005 2006 2005
£m £m £m
-------------------------------------------------------------------------------
Revenue 1,550.0 1,093.0 2,285.7
Cost of sales (1,191.4) (799.2) (1,681.4)
-------------------------------------------------------------------------------
Gross profit 358.6 293.8 604.3
Operating expenses (49.8) (42.0) (76.5)
Share of results of jointly 0.3 - -
controlled entities
-------------------------------------------------------------------------------
Profit from operations before 309.1 251.8 527.8
reorganisation costs
Reorganisation costs (15.4) - -
-------------------------------------------------------------------------------
Profit from operations 293.7 251.8 527.8
Finance income 0.6 0.3 0.8
Finance costs (38.2) (17.2) (33.2)
-------------------------------------------------------------------------------
Profit before tax 256.1 234.9 495.4
Income tax expense 6 (77.0) (72.0) (150.6)
-------------------------------------------------------------------------------
Profit after tax (all attributable to equity 179.1 162.9 344.8
holders of the parent)
-------------------------------------------------------------------------------
Earnings per share (after reorganisation costs)
Basic 7 60.7p 56.2p 118.4p
Diluted 7 60.3p 55.9p 118.0p
Earnings per share (before reorganisation costs, net of
related tax)
Basic 7 64.4p 56.2p 118.4p
Diluted 7 64.0p 55.9p 118.0p
PERSIMMON PLC
Consolidated Balance Sheet (unaudited)
Note 30 June 30 June 31 December
2006 2005 2005
£m £m £m
---------------------------------------------------------------------------
ASSETS
Non-current assets
Intangible assets 470.5 182.0 182.0
Property, plant and equipment 49.3 29.2 32.5
Investment in associates - - 169.1
Investment in jointly 3.4 - -
controlled entities
Trade and other receivables 11.2 - -
Deferred tax assets 63.9 32.1 33.3
---------------------------------------------------------------------------
598.3 243.3 416.9
---------------------------------------------------------------------------
Current assets
Inventories 2,973.2 2,138.1 2,197.9
Trade and other receivables 193.9 95.3 107.2
Cash and cash equivalents 5 39.3 96.1 10.7
---------------------------------------------------------------------------
3,206.4 2,329.5 2,315.8
---------------------------------------------------------------------------
Total assets 3,804.7 2,572.8 2,732.7
---------------------------------------------------------------------------
LIABILITIES
Non-current liabilities
Interest bearing loans and 5 (816.0) (234.5) (233.6)
borrowings
Forward currency swaps 5 (86.6) (25.9) (19.5)
Deferred tax liabilities (28.5) (9.2) (8.3)
Retirement benefit obligation (91.6) (66.8) (73.5)
Other liabilities (108.7) (59.0) (61.5)
---------------------------------------------------------------------------
(1,131.4) (395.4) (396.4)
---------------------------------------------------------------------------
Current liabilities
Trade and other payables (683.2) (543.3) (529.4)
Current tax liabilities (104.6) (84.2) (89.1)
Forward currency swaps 5 (2.8) (1.4) (1.4)
Interest bearing loans and 5 (50.2) (16.3) (24.4)
borrowings
---------------------------------------------------------------------------
(840.8) (645.2) (644.3)
---------------------------------------------------------------------------
Total liabilities (1,972.2) (1,040.6) (1,040.7)
---------------------------------------------------------------------------
Net assets 1,832.5 1,532.2 1,692.0
---------------------------------------------------------------------------
SHAREHOLDERS' EQUITY
Ordinary share capital issued 29.7 29.2 29.5
Share premium 230.7 226.6 229.2
Own shares (5.2) (4.0) (4.1)
Hedge reserve (12.5) 3.1 0.6
Consolidation reserve 281.4 281.4 281.4
Retained earnings 1,308.4 995.9 1,155.4
---------------------------------------------------------------------------
Total shareholders' equity 1,832.5 1,532.2 1,692.0
---------------------------------------------------------------------------
PERSIMMON PLC
Consolidated Cash Flow Statement (unaudited)
Six months to Six months to Year to
30 June 30 June 31 December
Note 2006 2005 2005
£m £m £m
---------------------------------------------------------------------------------
Cash flows from operating activities:
Net profit after income taxes 179.1 162.9 344.8
Adjustment for:
Tax 77.0 72.0 150.6
Finance income (0.6) (0.3) (0.8)
Finance costs 38.2 17.2 33.2
Depreciation charge 5.0 3.6 7.3
Amortisation of intangible assets 0.1 - -
Share of results of jointly controlled (0.3) - -
entities
Profit on disposal of property, plant (0.5) (0.2) (0.4)
and equipment
Share-based payment charge 2.5 1.0 2.0
Other non-cash items (4.0) 0.4 (0.4)
---------------------------------------------------------------------------------
Operating profit before working capital 296.5 256.6 536.3
changes
Changes in working capital:
Decrease/(increase) in inventories 158.7 (145.3) (191.4)
Decrease/(increase) in trade and other 31.2 3.4 (8.5)
receivables
(Decrease)/increase in trade and other (69.3) 25.2 10.2
---------------------------------------------------------------------------------
payables
Net cash from operations 417.1 139.9 346.6
Interest paid (27.6) (13.5) (25.8)
Interest received 0.6 0.3 0.8
Tax paid (62.2) (70.3) (144.5)
---------------------------------------------------------------------------------
Net cash from operating activities 327.9 56.4 177.1
Cash flows used in investing
activities:
Acquisitions (508.5) - (169.1)
Purchases of property, plant and equipment (5.3) (4.3) (11.1)
Proceeds from sale of property, plant 1.1 0.7 1.3
and equipment
---------------------------------------------------------------------------------
Net cash used in investing activities (512.7) (3.6) (178.9)
Cash flows from/(used in) financing
activities:
Repayment of borrowings (237.1) (1.6) (26.2)
New loan facilities drawn 487.3 - 10.0
Finance lease principal payments (0.5) (0.6) (1.2)
Exercise of share options 1.0 3.3 6.1
Dividends paid to Group shareholders (40.0) (38.2) (58.6)
---------------------------------------------------------------------------------
Net cash from/(used in) financing 210.7 (37.1) (69.9)
activities
---------------------------------------------------------------------------------
Increase/(decrease) in net cash and cash 25.9 15.7 (71.7)
equivalents 4
---------------------------------------------------------------------------------
Net cash and cash equivalents at 7.7 79.4 79.4
beginning of period
---------------------------------------------------------------------------------
Net cash and cash equivalents at end of 33.6 95.1 7.7
period 5
---------------------------------------------------------------------------------
PERSIMMON PLC
Consolidated Statement of Recognised Income and Expense (unaudited)
Six months to Six months to Year to
30 June 30 June 31 December
2006 2005 2005
£m £m £m
-----------------------------------------------------------------------------------
Effective portion of changes in fair value (18.7) (3.0) (6.5)
of cash flow hedges
Actuarial losses on defined benefit schemes (16.2) - (7.6)
Taxation on items taken directly to equity 10.5 1.4 4.2
Net expense recognised directly in equity (24.4) (1.6) (9.9)
-----------------------------------------------------------------------------------
Profit for the period 179.1 162.9 344.8
-----------------------------------------------------------------------------------
Total recognised income for the 154.7 161.3 334.9
period
-----------------------------------------------------------------------------------
Notes (unaudited)
1. Accounting Policies
This interim information has been prepared by applying the accounting
policies and presentation that were applied in the preparation of the
Group's published consolidated financial statements for the year ended 31
December 2005, except for the following changes:
The Group has assumed additional retirement benefit obligations following
the acquisition of Westbury plc. The schemes have been stated at the
present value of the obligation at the date of acquisition, less the fair
value of the scheme assets. Further detail on the schemes will be
presented in the financial statements for the year ending 31 December
2006.
Investment in jointly controlled entities is measured using the net equity
method. The Group's share of the result of jointly controlled entities is
credited/charged to the income statement. Exchange rate differences
arising on translation are reflected in the income statement.
2. Dividends
The final dividend for 2005 of 19.0p (2004: 18.4p) was approved by
shareholders during the period and a charge of £55.9m (2004: £53.1m) was
taken to reserves.
The directors propose an interim dividend of 13.8p (2005: 12.0p). No
charge has yet been made for this dividend in accordance with IAS 10
(Events After the Balance Sheet Date).
3. Business Combinations
On 17 January 2006 the Group acquired the entire issued share capital of
Westbury plc for a total consideration, including preliminary investment at
24 November 2005, of £664.0m. This consideration was satisfied by cash of
£650.6m and loan notes of £13.4m. The fair value of the loan notes at
issuance was equal to face value. Westbury was a UK housebuilder with the
bulk of its operations being in the south of England and Wales.
In the period to 30 June 2006 the acquired business contributed £370.6m of
revenue and £64.5m to gross profit. If the acquisition had occurred on 1
January 2006, the estimated revenue would have been £375.5m with gross
profit of £66.2m.
Effect of the acquisition
The acquisition had the following effect on the Group's assets and
liabilities:
Acquiree's net assets at the acquisition date
Provisional
Book Value Fair Value
£m £m
------------------------------------------------------------------------------
Intangible assets 43.1 61.9
Property, plant and equipment 17.3 16.8
Investment in jointly controlled entities 3.1 3.1
Deferred tax assets 13.5 30.0
Inventories 944.6 933.8
Cash 104.3 104.3
Bank overdrafts (131.3) (131.3)
Bank loans (370.4) (370.4)
Forward currency derivatives (24.5) (24.5)
Other receivables and payables (94.9) (126.4)
Retirement benefit obligation (38.4) (38.4)
Deferred tax liabilities (2.2) (21.7)
-----------------------------------------------------------------------------
Net assets 464.2 437.2
Goodwill on acquisition 226.8
-----------------------------------------------------------------------------
Consideration paid (including costs) 664.0
Loan notes issued as consideration (13.4)
Net cash and cash equivalents 27.0
acquired
Existing investment in Westbury plc shares (169.1)
-----------------------------------------------------------------------------
Net cash outflow in period 508.5
-----------------------------------------------------------------------------
At 30 June 2006 the fair values of the assets and liabilities acquired
noted above are provisional.
During the period the Group acquired the remaining 50% interest in
Wescott Holdings Limited.
4. Reconciliation of Net Cash Flow to Net Debt
Six months to Six months to Year to
30 June 30 June 31 December
2006 2005 2005
Note £m £m £m
-----------------------------------------------------------------------------
Increase/(decrease) in net cash and 25.9 15.7 (71.7)
cash equivalents
(Increase)/decrease in debt and (263.1) 2.2 17.4
finance leases
-----------------------------------------------------------------------------
(Increase)/decrease in net debt from (237.2) 17.9 (54.3)
cash flows
Net debt acquired (394.9) - -
New finance leases (0.4) (0.8) (1.4)
Non-cash movements (15.6) (2.9) (16.3)
-----------------------------------------------------------------------------
(Increase)/decrease in net debt (648.1) 14.2 (72.0)
Net debt at beginning of period (268.2) (196.2) (196.2)
-----------------------------------------------------------------------------
Net debt at end of period 5 (916.3) (182.0) (268.2)
-----------------------------------------------------------------------------
5. Analysis of Net Debt
30 June 30 June 31 December
2006 2005 2005
Note £m £m £m
------------------------------------------------------------------------------
Cash and cash equivalents 39.3 96.1 10.7
Bank overdrafts (5.7) (1.0) (3.0)
------------------------------------------------------------------------------
Net cash and cash equivalents 33.6 95.1 7.7
Bank loans due after more than one year (230.0) - (10.0)
US/UK senior loan notes due within one (18.6) (14.3) (20.2)
year
US/UK/EU senior loan notes due after more (584.7) (233.0) (222.3)
than one year
Other loan notes (24.8) - -
Forward currency swaps (89.4) (27.3) (20.9)
Finance leases (2.4) (2.5) (2.5)
------------------------------------------------------------------------------
Net debt at end of period 4 (916.3) (182.0) (268.2)
------------------------------------------------------------------------------
6. Taxation
Taxation has been calculated at 30.0% of profit before taxation (six
months to 30 June 2005: 30.6% and year ended 31 December 2005: 30.4%).
This is the estimated effective tax rate for the year to 31 December
2006.
7. Earnings Per Share
Basic earnings per share is calculated by dividing the earnings
attributable to ordinary shareholders of £179.1m (£190.0m before
reorganisation costs of £15.4m, net of related tax of £4.5m) (six months
to 30 June 2005: £162.9m and year ended 31 December 2005: £344.8m) by the
weighted average number of ordinary shares in issue, excluding those held
by the Employee Share Ownership Trust and the Employee Benefit Trust
which are treated as cancelled. The weighted average number of ordinary
shares in issue during the period was 295,189,559 (30 June 2005:
289,689,694 and 31 December 2005: 291,120,186).
For diluted earnings per share, the weighted average number of ordinary
shares in issue is adjusted to assume conversion of all potentially
dilutive ordinary shares from the start of the accounting period. The
Company has only one category of potentially dilutive ordinary shares:
those share options and awards granted to directors and employees where
the exercise price is less than the average market price of the Company's
ordinary shares during the year.
The weighted average number of ordinary shares so calculated is
296,966,396 (30 June 2005: 291,318,992 and 31 December 2005:
292,236,493).
8. Basis of Preparation
The figures for the half years to 30 June 2006 and 30 June 2005 are
unaudited. The figures included in the Income Statement for the year to
31 December 2005, the Balance Sheet at 31 December 2005, the Cash Flow
Statement for the year to 31 December 2005 and the Statement of
Recognised Income and Expense for the year to 31 December 2005 are
extracts from the latest published accounts which have been delivered to
the Registrar of Companies. The report from the auditors on those
accounts was (i) unqualified, (ii) did not include a reference to any
matters which the auditors drew attention to without qualifying their
report, and (iii) did not contain a statement under section 237 (2) or
(3) of the Companies Act 1985.
9. The Interim Report was approved by the Board of Directors on 21 August
2006 and is being sent to all shareholders. Further copies are available
upon request from the Company Secretary, Persimmon plc, Persimmon House,
Fulford, York YO19 4FE.
Further information about the Group can be found on the Persimmon website at:
www.persimmonhomes.com
This information is provided by RNS
The company news service from the London Stock Exchange
