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House completions fall as Persimmon puts quality over quantity

By James Pugh | Wolverhampton | Business | Published:

Housebuilder Persimmon saw the number of homes it completed fall by four per cent in the last year, as the company attempts to improve the quality of its building work following a scathing report into its work practices.

Persimmon has sites in the Black Country, Shropshire and Staffordshire

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.

The fall means full-year revenues hit £3.65 billion in the 12 months to December 31, down 2.4 per cent compared with a year earlier. The average selling price was just £137 more than a year ago, at £215,700, the company added.

Persimmon has sites in the Black Country, Shropshire and Staffordshire, and its West Midlands office at Broadlands, Wolverhampton.

Dave Jenkinson, chief executive, said: "Delivering the maximum benefit to our customers from our quality and service improvement initiatives will continue to be my top priority for 2020.

"I am pleased with the progress we have made in 2019 and there is more to do.

"Action taken to maintain our increased levels of work in progress investment, the increase in quality assurance and customer service resources, and our plans for the implementation of the recommendations of the recent independent review, will all add to our momentum."

Published in December and led by Stephanie Barwise QC, the report found Persimmon did not properly install fire barriers in homes.

The company was criticised for a series of failures and accused of focusing on achieving a five-star rating from the Home Builders Federation (HBF), rather than building high-quality and safe homes.

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Persimmon is moving away from focusing on the HBF rating, which is based on customer reviews shortly after the house is completed, and is not "a measure of the true quality and safety of the build".

Although Mr Jenkinson said: "While our plans for delivering a sustained improvement in quality go far beyond a focus on the criteria of the HBF customer satisfaction survey, our current rating, which is trending strongly ahead of the four star threshold, is tangible evidence of the improvement we are making."

He added that more details and a fuller response to the independent report and an update on the UK housing market would follow in the next few months.

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The company said: "Looking ahead to the 2020 spring season, Persimmon is in a strong market position. The group has a nationwide outlet network and a range of attractive house types available at affordable prices across the UK regions, supported by high quality land holdings and a conservative balance sheet."

Persimmon also announced non-executive director Claire Thomas, who joined the board in August last year, has decided to quit.

She said: "I have valued being part of the Persimmon board and the experience it presented but it has also made clear to me my preference for working in a large-scale complex global business environment.

"In my time on the board I have seen clear and determined efforts to transform the business and I wish Persimmon the best in their ongoing efforts."

James Pugh

By James Pugh
@JamesP_Star

Shropshire Star Business and Farming Editor.

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