UK's Persimmon targets volume growth in 2022 after profit rise

Builders construct modular Space4 homes on a Persimmon development in Coventry
Builders construct modular Space4 homes on a Persimmon development in Coventry, February 22, 2017. REUTERS/Darren Staples

March 2 (Reuters) - Britain's second-largest homebuilder Persimmon Plc (PSN.L) said on Wednesday it expected to build 4-7% more homes in 2022, riding on strong housing demand, after the firm posted a 23% rise in annual profit.

UK homebuilders have forecast the undersupplied housing market to stay resilient even though Britain in January saw inflation rise at its fastest annual pace in nearly three decades, while the deepening Russia-Ukraine crisis adds further pressure on fuel prices.

"We are targeting volume growth of 4-7% on 2021 levels ... although we are mindful of the growing risk of an economic impact as a result of the tragic conflict in Ukraine," said Chief Executive Dean Finch.

Persimmon built 14,551 new homes in 2021, clearly above 13,575 units a year earlier.

The company said its current position of forward sales - the agreement between builder and buyer with a future purchase date - stood at 2.21 billion pounds ($2.94 billion), slightly lower than 2.27 billion pounds a year earlier.

The FTSE 100 firm's pre-tax profit for the year ended Dec. 31 came in at 966.8 million pounds, slightly below a company-compiled average forecast of 975 million pounds from 19 analysts.

Persimmon's bigger rival Barratt Developments (BDEV.L) and the third biggest player Taylor Wimpey (TW.L), which reports its annual results on Thursday, have also forecast strong market activity this year.

($1 = 0.7527 pounds)

Reporting by Aby Jose Koilparambil in Bengaluru; editing by Milla Nissi

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