Finance Director Michael Killoran, 48, said in an interview with Bloomberg that the worst is yet to come for its profit margins as signs of improving demand fail to spark a recovery in house prices. Potential customers are struggling to get credit as banks tell their valuation teams to be cautious. That’s stifling property prices and will leave Persimmon’s profitability short of last year’s 11.3% level.
Persimmon beat its sales targets in the first 16 weeks of the year, yet there are still “issues” with pricing, according to the finance chief. The average selling price dropped 8.7 percent to 173,000 pounds ($253,000) in 2008 amid the widest housing slump in 30 years. Margins are also being squeezed as Persimmon resorts to the “usual” incentives, like paying utility bills for 12 months, to secure clients, he said.
http://www.bloomberg.com/apps/news?pid=20601102&sid=ar2xHfFGmJNw&refer=uk
http://www.stockopedia.com/news/announcement/PSN/090423psn000543.htm
Doesn't sound like a buy yet!?!
