Persimmon set to hit its targets

HOUSEBUILDER Persimmon expressed its confidence in the UK property market at its annual general meeting today but announced that founder and chairman Duncan Davidson would retire in April next year.

Property has been one of the most buoyant sectors of the UK economy, with house prices soaring even during the economic downturn between 2001 and 2003, although recent interest-rate rises have led to a cooling off.

Persimmon said sales reservations were in line with normal market conditions, indicating the resilience of the sector, although customers remained cautious before making purchases.

'We have continued to sell at good levels across the UK, albeit at slightly lower volumes than the strong comparative period in 2004,' the company said in a statement. However, the current total sales revenue for 2005 is at a similar level to the same date in 2004, at around £1.4bn. We therefore remain confident of achieving our half-year expectations,' it added.

Persimmon shares were down 0.2% at 705p in early trading, as some analysts said the company's trading update was more cautious than previous statements.

Chief executive John White will become chairman when Davidson retires and Mike Farley, currently chief executive of Persimmon's south division, will be promoted to White's job.

Rival builder George Wimpey said last week its outlook was encouraging despite some market uncertainty caused by the forthcoming General Election and possible interest-rate rise