Persimmon Q4 Earnings Call Highlights

Core Insights - Persimmon reported a strong performance in 2025, with a 12% growth in completions and expects underlying profit before tax at the upper end of expectations, driven by outlet expansion and a robust fourth quarter [5][7][21] Sales and Pricing - Forward sales increased by 2% in value terms, with private forward sales up 4%, although PRS forward sales value declined due to fourth-quarter disruptions [1] - Average selling prices (ASP) rose, with private ASP up 5% and affordable ASP up 4%, leading to a blended ASP growth of 4% overall [3][7] - Pricing incentives have remained stable at around 4% to 5% for the last 18 months, with regional variations noted [2] Completions and Growth - Completions growth was driven by a mix shift across channels, with affordable completions up 30%, PRS up 20%, and private completions up 6% [4] - The company expects around 12,000 completions for FY2026, although growth is anticipated to slow compared to 2025 [10][8] Market Conditions and Land Opportunities - Management highlighted an excellent pipeline of land opportunities, with improved access attributed to better partnerships and brand rehabilitation [12][11] - Recent government progress on planning and infrastructure is seen as positive, although real-world impediments remain [11] Cost Pressures and Margin Outlook - Key cost headwinds include a significant increase in landfill tax and the upcoming Building Safety Levy, which will impact cash costs [6][14] - Despite these pressures, the company expects margin progression in 2026 to be similar to that of 2025 [17] Remediation and Capital Allocation - The company is nearing completion of remediation works, with 90% of known developments either completed or contracted [18][19] - Management anticipates a reduction in remediation provisions over time, although the process may be uneven [19][20]