Persimmon Plc

Good day and thank you for standing by. Welcome to the Persimmon PLC Trading Update conference call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be the question and answer session. To ask a question during the session, you need to press star, 1, 1 on your telephone keypad. You will then hear an automated message advising your hand is raised. To withdraw a question, please press star, 1, and 1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to our first speaker today, Dean Finch, CEO. Please go ahead.

Good morning and thank you for joining Andrew and I today. As usual, I'll say a few words by way of overview and then hand over for the Q&A. As you can see from our statement, we have delivered a strong end to the year with 12% growth in completions. This means that we expect to be reporting an underlying profit before tax at the upper end of expectations, this also being double-digit growth, as well as growth in margins. We believe that this organic growth in completions is one of our strongest on record. I would like to thank my brilliant colleagues at Persimmon, as well as our supportive subcontractor base and supply chain for this fantastic result. Our people went above and beyond in the final quarter of last year and I want to place on the record my grateful appreciation of this. This growth in completions is made up of 30% growth in affordable, 20% growth in PRS and 6% growth in private, with the private growth largely driven by growth in outlets. We also saw 5% growth in private ASP, and 4% growth in affordable ASP, giving us a blended growth in ASP overall of 4%. We also make good progress in opening outlets over the year, ending at 277. Forward sales are up in value terms by 2%, with the value of private forward sales up by 4%, but the value of PRS forward sales down as we saw a quieter Q4 clearly impacted by budget uncertainties. As we look ahead to 2026, whilst we are only a few days into the new year, we expect, other things being equal, another year of growth as a result of another year of growth in outlet numbers. albeit we expect the overall level of growth to peb back from what we have just delivered as a result of slower growth in affordable and PRS sales. We have an excellent pipeline of land opportunities ahead of us that will convert into growing outlet numbers towards the end of 2026 and into 2027. But obviously we should be carrying the cost of opening these outlets and the finance costs of buying the land and progressing the WIP in 2026. Taking all this together at this stage means that we expect, other things being equal, that 2026 will be another year of good profit growth, but that profit will lie in the current consensus range. We also update on cladding. During the year, we were notified of three more buildings that require remediation. so we'll need to make a modest adjustment to the provision accordingly. Overall, we expect the provision at the end of 2025 will be less than at the start of the year. To give some reassurance, we are now completed, contracted, or have an agreed tender price for 90% of known developments. So in conclusion, we do have some headwinds in 2026, Landfill tax comes in from April, and that sees our cash costs rise this year from £10 million to £20 million. Thereafter, and mitigated, it continues to rise. And just to remind you, we think it goes from £4 a tonne to £25 a tonne by the end of the decade. And, of course, the building safety levy comes in from October. But overall, I think the business is in great shape. As I've just said on remediation, we have 90% of known buildings completed, contracted or costs agreed. We have a fantastic pipeline of land opportunities that will convert into outlets towards the end of 2026 and into 2027. We have a great range of products from the affordable end right the way through to Charles Church, but throughout we design our build costs to keep our costs low, our bill to keep our costs low, giving us more routes to market, which I think is incredibly important in this environment. All our house types are supported both by New Build Boost and Reside, and of course by our brick and tile and timber frame factories. And finally, I am supported by a fantastic team of individuals at Persimmon. We are looking forward to another year of solid growth in profit. And with that, thank you for listening to me. I'll turn it over to Q&A.

Thank you, dear participants. As a reminder, if you wish to ask a question, you need to press star 1, 1 on your telephone keypad and wait for a name to be announced. To withdraw a question, please press star 1 and 1 again. Liz and Bob will compile the Q&A roster. This will take a few moments. And now we're going to take our first question. Just give us a moment. And it's Countryland of Ainsley Laman from Investec. Your line is open. Please ask your question.

Thanks very much. Happy New Year, everybody. Just two questions from me, please. On the, you kind of alluded to the fact the site openers would be more end of this year into 27. Just wondered how you see the kind of obviously planning infrastructure bill was passed before Christmas. Do you think that has a meaningful impact when you start to see that this year? And just a bit more colour, I guess, around the planning backdrop, how easy that might become from here and then secondly on the completions I think you'd kind of given a guidance target of around 12,000 for FY26 is that still in place obviously you had a good end to the year affordable was very high does that kind of bring you forward some of those completions and therefore 12,000 still what you're saying for FY26 at this stage thanks morning Ainsley so happy new year to you too maybe if I start with planning

and then I'll ask Andrew to pick up on guidance for 26. So I think the government policy and progress thereof and the Paying and Infrastructure Bill is enormously welcome and is probably the most positive developments that we've seen in, you know, I haven't had the benefit of a long career in house building, but all my colleagues are telling me, you know, best environment they have seen probably all of their working careers. However, my word of caution around it is that whilst I think that it is incredibly positive and I'm hugely grateful to the government, policy as ever takes some years to break through and cut through, you know, on the ground. And I think that remains the case. So whilst we've had really good progress in developing our land opportunities into outlets, it's really hard work still, and that's because Beyond the policy framework, it's the detail on the ground. So if, for instance, you take an example of ours up in the North East, we've had the ticket for two years for a particular site, but the drainage consultants can't agree, so we can't get the discharge conditions. Also in the North East, we've got a site where not quite two years, but nearly, I've got Highways consultants that are arguing the toss and we can't get on site. In Kent, we have two local authorities who are preventing us from all signing the Section 106, even though we were ready to go over a year ago, because they can't agree on the division of the education contributions. And in Wales, Wales have just discovered nutrients and so that is also giving us a problem. Am I frustrated? Enormously so. What we need to see is cut through, cut through from the great but very lofty policy statements and ambitions to cut through. If the government needs to focus on delivery in this parliament, the policy is going to enable them to deliver into the next parliament. We need to live for the here and now. So I'm hugely grateful and welcoming of the progress that's been made in planning, but I'd like to see some real cut through on the ground and get us moving. And over to you, Andrew. Now I've served up my sermon on planning to consensus.

Yeah, morning Ainslie. So just briefly on consensus volume, so as you say we briefly guided to 12,000 uncomfortable at this stage one week into the year that's still you know it's still you know where we're at I mean just to put a little bit of colour on it and we can talk more in March obviously you we did have a very strong end to 2025 particularly you can see on the affordable delivery you can only deliver that those units once you know so there's a you know we brought you know we delivered strongly We know that the affordable market is still challenging. And as Dean mentioned in his opening remarks, the order book is a little bit lighter on the bulk sales than it was this time last year. So hopefully that market will come back post-budget, but it will be just a little bit behind the curve compared to where we might have been otherwise. And so given those two things, I think volume growth then starts to be driven again by outlet growth. in the business, and as we said, we will be growing outlets this year, but probably more towards the latter half of the year rather than the start. So putting all of that together, I think I'm comfortable with where the number is for now and also when we come out in March, we'll give a bit more colour on the trading in the opening few weeks and see what that means.

Thank you very much.

Thank you. Now we're going to take our next question. Just give us a moment. And the question comes from Will Jones from Rothschild and Redburn. Your line is open. Please ask your question.

Thanks. Morning. Three, if I can, please. First, just around the Boxing Day campaign where you talked about encouraging signs. I guess any further colour around that in terms of how it's translating through to website hits, I guess, at this stage, and maybe inquiries as we go forward. Second, maybe just on pricing, I think you talk about similar incentives, so I assume that it's not a huge amount new to say around pricing, but I think the growth in the order book's quite good, but again, perhaps influenced by bulk and other mix, but yeah, any thoughts on underlying pricing, that would be great. And then just a couple of taxation points you raise around landfill and building safety levy, any thoughts you've got on potential mitigation measures, landfill, potentially delaying the impact of the building safety levy by getting your controls through early. And just in that backdrop, whether you still think the scope to kind of nudge ahead the margin potentially in 26. Thanks.

Thanks for warning. Let me pick those up. So yes, in terms of Boxing Day, and I guess, you know, it's encouraging website visitors have been good, you know, higher this year than last year. I guess my caveat on that, of course, is a single data point and it's very hard to take a trend from a single data point well, so we have to see how that manifests itself, how that runs through as we go forward. But certainly in terms of website traffic off the back of the Boxing Day campaign has been very good. Pricing, as you say, incentives. I mean, incentives have stayed at about 4% or 5%, probably the last 18 months, actually, since I've been in the business, have been similar. And we have probably had slightly more robust pricing, certainly I think in the north, North Midlands and so on, further away from the southeast. You are right that the ASP growth in the order book is not – that's not illustrative of what I see ASP growth going into 2026 will be. That's really about the mix in the order book. As you say, there's more open market sales in there. bulk sales and so on, so there is a mixed effect in the order book, so I wouldn't try to read too much into the 6% uplift, albeit it is good that pricing, yeah, I think has been pretty robust through 2025. And then just on the two tax points, so you're right, so landfill tax, as well as doubling, obviously they introduced, that increases a year earlier than they were originally consulting on, and of course that limits the immediate chance to mitigate. The most obvious mitigation would have been to try to do some of that groundwork before the tax increase. Of course, that opportunity is reduced by time. We've only got three months to do that. Clearly, we are looking at designer sites to see where we can mitigate in terms of reducing taking spoil away to landfill. That's clearly the most obvious case. We've just signed an agreement externally to help with a third party to help us manage and manage our soil and landfill as well. So we are looking to mitigate that and clearly as we grow outlets, as we open new outlets, a lot of the infrastructure work is done early and that will be subject to the new taxes if we can't find alternative ways to deal with the spoil. And then on building safety, Levi, I think you covered off the key point, which is actually getting our star on site and our building controls signed off and agreed early is clearly what we'll be looking to do to try to make sure that where we can, we can mitigate building safety levy to the extent that's not already been factored into land acquisitions of course. So there's a timing opportunity there for us to work that through.

Thank you. And the overall view on margin possibilities in 26, is it still as you were before?

Yeah, so what we said was that we saw the margin progression in 26 to be a similar rate of progression as we have seen in 25. I think that's probably still the case, Will, because there are some of those headwinds. And as we talked about in the summer, that embedded inflation from 2022 and 2023 takes time to work its way through the system absent any significant house price inflation to offset it. Sure.

Thank you.

Thank you. Now we're going to take our next question. And it comes to the line of Zain Bikawa from JP Morgan. Your line is open. Please ask your question.

Morning. Thanks for taking my questions and Happy New Year. But firstly, just on the PRS, any expectations to when you think this will come back post-budget and does it still remain sort of a core part of your strategy there? or still part of a key strategic market. And then secondly, on the fire safety, kind of just maybe an updated view and when you maybe finish with these and how that will inform your approach to capital allocation. Thank you.

Okay. Mornings. Let me take those. So first on the PRS. So we saw, and there's some specific examples that we had, deals which were almost ready to agree, which were then paused. in the run up to the budget. Those customers, those investors obviously are very alive to things like guilt rates and they include all the speculation in advance of the budget. That was weighing heavily. So I'd like to think that market will come back. It's still an important market for us. We still think strategically it's important as Dean mentioned in his opening comments. What we're trying to do is to sell into different markets to give ourselves the maximum opportunity. So whether that's Charles Church, whether it's Corpus Immun, whether it's Bill to Rent. So it's a key part of the strategy still. And I think hopefully we'll see some progress there in the first half year. So obviously post-budget you were straight into the Christmas running. So it was a little bit too short a period to really see that come back in December. But I'd like to think that market will will come back and stay important for us. In terms of fire safety, Dean talked to that. It's a small adjustment. We've always said that the important thing is that we are on the front foot. We're dealing with the fire remediation work. We've always said that the provision will come down. It might come down a little bit lumpy as it comes because these are complicated projects as we work forward. But we still are looking to do the bulk of that work This year and next year, of course, there'll be a long tail, but that tail will be kind of business as usual, if you like, in terms of quantum. So this year and next year are still the key areas or the key time for getting through the bulk of that work. Oh, sorry, just to pick up in terms of impact on capital allocation. So we said in the summer that what we wanted to do is to see our way towards the end of that work. So we don't have to be finished, full stop, but we want to be closer to the end point. So I still think that's the case. And as we get through 26 and into 27, that gives us opportunity to update on the capital allocation policy. Great, thank you.

Thank you. Now we're going to take our next question. And it comes to line of Amy Gala from Goldman Sachs. Your line is open. My apologies. Amy Gala from Citi. My apologies. Your line is open. Please ask a question. Yeah, thanks.

Two questions for me as well. The first one was just a follow-up on the ASP point. You've seen a significant positive mix effect on the affordable ASP in 25. Do we expect that to reverse? And the second question on bill cost inflation, we are targeting a similar level in 26. The first one is, could you update us what the 25 bill cost inflation eventually stacked up to be? And into 26, where are the pressures on bill costs really coming from?

Okay. So, morning, Amy. Let me pick those up. So, in terms of the ASP, so you're right, there was some mixed effect. But actually, what we saw in delivery in – in 2025 we saw ASP growth across Persimmon and the Charles Church and affordable. So I think in terms of the affordable, of course, it's always linked to the geography, because as you would expect. So I think in terms of what are we seeing in terms of underlying ASP growth, I think we see, as I said earlier, its pricing is robust around the country. It's more of an acute issue. you know, in the south and southeast because headline prices are higher and therefore affordability is more of a challenge more broadly for our customers. But, you know, I think, you know, we saw some good ASP growth overall, 4% up year on year. And, you know, you'd like to think that ASP growth will continue, but it will be, you know, I wouldn't expect it to be at the level that we see in the forward order book because that is driven by mix effect. So, you know, and it will be driven by mix and by geography again, as we go into 2026. On bill cost inflation, we talked all the way through 25 of low single digits. So you're kind of in that sort of two to 4% inflation. I don't really see any reason why that will be different in, as we go into 2026, where the pressure and that sort of level of inflation really will be across materials, it will be across the supply chain as well. So because... you know, if you like, that's relatively normalised levels of inflation. But the key thing I think that you just to remember, it goes back to the margin progression point I made to Will, is, of course, that's bill cost inflation on already elevated bill costs. You know, so it's not a question of costs coming down. It's a question of costs going up, but that's probably a similar level to 2025. Thank you.

Thank you. Now we're going to proceed with our next question. Just give us a moment. And the question comes in the line of Glenis Johnson from Jefferies. Your line is open. Please ask your question.

Good morning. I'm going to go with three as well, if I may. The first one is just a clarification in terms of the outlet count. You talk about growth towards the end of 2026, but should we be anticipating that outlets might dip a little bit through the middle of the year and then pick up, or is it just going to be steady and then climbing? The second one, just in terms of Charles Church, can you just give us a little update in terms of how Charles Church did for the 2025 as a whole and what we, It should maybe be thinking about for 2026 just in terms of proportion of completions. And then lastly, just in terms of some of the measures you referenced earlier, reside, you know, if you can just talk through, you know, the measures, you know, what the uptake's been, whether or not they're making any kind of difference to your sales rates.

Okay, morning, Glynis. Let me pick those up. So in terms of the outlet count, I would expect it to be, you know, through the year, relatively steady. The tickle-up will be towards the back end, as Dean mentioned. I mean, of course, it's always, you know, if we sell faster, then we will, you know, then we have them falling off the belt a little bit quicker, and sometimes we see that, you know, at the end of the first half year. But generally speaking, I think it will be relatively steady, but then, you know, and then that push-up in the towards the latter part which will then drive additional growth hopefully into 2027. So I wouldn't be necessarily modelling for a dip in outlets but as your sales rates pick up there's always a chance that you end up with some falling off the belt a little bit earlier than you expected. Charles Church really pleased with the progress, so we relaunched it in March of 2025, as you know, and that was in terms of the product, in terms of the specification, in terms of the branding, the route to market, and that's done really well. So the volume growth in Charles Church was strong in 2025. We had the volume growth in Charles Church outstripped the volume growth in Persimmon, but really, importantly, both products grew. So it's not that we're growing Charles Church at the expense of Persimmon, they both grew. And the Charles Church had a slight take up therefore in terms of its relative share compared to 2024. And that's good. So what we said is that we want to, in 2024, Charles Church was just shy of 1000 units. We're looking to get that to 2000 over the next two or three years. So we'd expect that growth in Charles Church to be quicker and to continue to grow faster in 2026. So we're really pleased with how that relaunch has gone. And again, in the current market, I think having more strings to our bow, more routes to market, more routes to different customers has proved really beneficial. And similarly, as well as looking at Charles Church at one end of the market, obviously, we've also launched New Build Boost and Reside. in terms of, again, it's about trying to bring people to site and offer something different to different customers. So reside very little impact in 2025. We only launched it in Q4. So you wouldn't expect significant impact. New Build Boost, we launched it in Q2. Yeah, that has had some impact in terms of driving people to site. Interestingly, quite a lot of people who've come in and qualified on New Build Boost have ultimately then reserved on traditional products. So it has driven footfall and driven regular sales as well as new build boost sales. So I think neither of the products are, if you like, transformational, but they are both incrementally helpful in driving people to site and therefore driving additional sales.

Thank you. Thank you. Now we're going to take our next question and it comes from Charlie Campbell from Stifel. Your line is open. Please ask your question.

Good morning. Happy New Year to you. Just a couple from me really. One was on mortgages and I'm just wondering if there's anything to say on mortgage availability. Quite a bit of noise around that but wondering if you've seen any changes on the ground or else if people are telling you to expect changes in this year ahead. And then secondly, on affordable, just so I can sort of understand the path of that a bit, should we expect a lower percentage of affordable in 26? And also just on the timing, just wondering when the sort of affordable homes program money start to kind of kick in. I understand people have got to apply by February, but just understand kind of when that kind of you would expect housing associations to have more appetite for buying affordable housing programs. with those funds. Thank you.

Morning, Charlie. So let me just pick those up in terms of mortgage availability, mortgage market. I mean, look, helpful that interest rates are lowering. You know, that's also useful. It's helpful that there was some additional or higher loan salary kind of mortgages coming out towards the end of last year, lower deposits. So So incrementally I think the mortgage market was probably more helpful at the end of 25 than it was at the start, but I think it's, again, it's incrementally helpful as opposed to being transformative and certainly affordability and access to a mortgage or to sufficient mortgage remains a key constraint for many of our customers. So I think there have been some, if you like, some helpful signs, but they're certainly not... they're not transformative, if you like. And that's why the industry, of course, has been calling for something similar to a health buy for exactly that reason. I mean, what we've been doing with New Build Boost, with Resyde, with Charles Church is not waiting for those kind of policy interventions we've been trying to get after the market. But I think mortgage availability and affordability more generally for our customers remains a key issue going into 2026. In terms of the affordable percentage, it was a little bit higher in 2025. Obviously, that's where we saw a significant growth, 30% growth in affordable units in 2025. Clearly, I wouldn't expect 30% growth year on year. So there is a likelihood that that percentage will come back a little bit in 2026. And so I think we're about 17% of total volume was affordable in 2025. I think it's probably somewhere in that 15% to 18% range, something like that. So it might be a little bit shy, a little bit lower percentage in 2026. And then in terms of the new funding, I mean, what we see is there are continuing to be funding challenges for our housing association partners, clearly they have a lot of pressures on their businesses. And I'm not sure that the new money which is likely to come in imminently in terms of those settlements, including the £39 billion the government talks about is separate to the Section 106 as well. So this is about really for the Section 106 funding.

So just as I may come in now, we were talking to the Chief Executive of Homes England yesterday. I mean, I suppose the point impressed on me yesterday is the... the government desire to press on with the programme is clearly strongly there. I think them getting organised to move into delivery is more towards the end of the year rather than being materially helpful to this year. There is that pipeline of money there and it will step up but I think I'd be expecting more of that impacting 27 and 26, just from what the chief exec was saying to me yesterday.

Thank you. Excuse me, Charlie, any further questions?

No, no, sorry, I was just saying thank you. Thanks very much.

Thank you. Thank you. Now we're going to take our next question. And it comes from Chris Millington from Deutsche Bank. Your line is open. Please ask your question.

That's right.

Hi. Morning, everyone. A few quick ones from me. Apologies. I joined a couple of minutes late, so I don't know if you touched on this. But I'd love your thoughts around the potential for any government support, whether there's any conversations you have in there. There seems to be a little bit of conversation about it in the sector. Next one, I'd just love to know the key moving parts on net cash for 26. You know, is there any danger you're moving to small net debt? Not that I see that as a big issue. And then I'd just love a little bit of detail around, you know, why these buildings have kind of come out of the woodwork with regard to fire safety. I know everyone's had additions, but just some of the detail behind yours, because I did feel you were a little bit further through your progress than, well, you are further through the progress than it is, but I'd love a bit more detail on that if possible.

Shall I go for more than three and you do two? Morning Chris. Again, based on my conversation from yesterday, what I would say is that it's firmly off the agenda at the moment. Will it be firmly off the agenda after May? Will there be opportunities looked at from a stimulus perspective later in the year? I certainly wouldn't rule it out. It is clearly being actively discussed. Treasury do regard this as inflationary and I think it is the job of us as developers, it's the job of MHCLG, it's the job of I think Zingman to persuade the Treasury that in the context overall that the inflationary element frankly, isn't a big deal. And, yeah, I can just about see how it can be inflationary, but I think it's pretty marginal. So, you know, don't hold your breath for now. But would I rule it out? No, definitely not. Is it core to our strategy? Absolutely not. If it comes, it will be a benefit to our strategy. If it doesn't, we can... happily cope without it as our strong performance in 2025 demonstrates. I'd also pick up on fire safety. Yep, it's a bummer, isn't it? Unfortunately, I'm afraid. And why is that? Well, because the tale is very long. It's 30 years. That's the contract we all signed up to. It's incredible that these buildings are still popping out at us. And, you know, it's frustrating, but there you have it. It is and we're dealing with it. We're in a really good shape. You perhaps didn't hear me say this at the start, but I'll repeat it again. Everybody else will be tired of me saying it. But in terms of our known buildings, we are 90% either complete, contracted or agreed price. So at least that variable of escalating cost is being controlled. And the other progress we made in Q3 and Q4 last year is that we began to achieve recoveries, which is really good news. High time. I think it is high time, as David said in the article in The Times this morning. You know, the whole burden of this has fallen on the developers. It needs to be expanded to the supply chain. and certainly we are rigorously going after recoveries and that will assist. So can I rule out and guarantee to investors there will be no new buildings pop out of me in 2026 that I had no idea we ever built? No. But do I think that it is manageable? Is a direction of travel down? Will we be out of the bulk of this in 26 and 27? Absolutely I do. and that will enable us to look at our capital allocation. The adjustment we're proposing for this period has obviously got to be approved by the board, it's got to go through audit committee, but I think in the context of everything it's pretty modest. So unfortunately, Chris, I think it's a fact of life. There will be bumps on the road. We never promised it would be linear, but year on year the provision is coming down.

Morning, Chris. I'll just pick up on the net cash for 2026. I mean, the reality is we'll give full guidance on it when we come out in March, Chris. But the point I would make, and again, apologies, I don't know when you joined the call, but obviously we are looking to grow outlets again in 2026. And growing outlets does take cash because you have to invest in the outlets, in infrastructure and getting the site set up and open. So there is upfront cash requirement to do that. We've also been active in the land market as well. So there is investment that we're making quite deliberately so and quite rightly so, but we'll give some more guidance on where we then expect our 2026 cash to be when we come out in March. Thank you.

Thank you. Now we're going to take our next question. Just give us a moment. And the question comes from Rebecca Parker from Goldman Sachs. Your line is open. Please ask your question.

Hi. Thanks. Just one for me on the land market. Just wondering if you could provide some color on land opportunities and where you're staying there and maybe the pricing in the market at the moment. Thanks.

Well, we're seeing more opportunities than we can cope with at the moment. I was glad at Christmas break, to be honest, in case there was another land committee inserted into it somewhere. So, yeah, look, it was extraordinary last year for us. Yeah, and it certainly escalated towards the end. So I think there's a combination of things going on there. I think certainly... You know, the other thing that's happening, as well as the sort of real dynamics of the market, I mean, obviously, we've got cash, but I think as well we're becoming a much better partner to do business with. So people who would never have spoken to Persimmon when I first joined five years ago now do speak to us. They do pick up the phone to me and others in the business, you know, and land promoters come and knock on our door. So I think as well as us being in a position to participate in the land market through the rehabilitation of the brand and the efforts of our people to demonstrate the improvement in customer service and build quality, and actually the design improvement of our developments is stepping up. So, you know, a key thing for landowners is they want to feel proud of land If they're selling a piece of land, which can be a big piece, a big thing, a big legacy in the community, they want to be proud of the development that they're leaving after them. And so that's been a big turnaround for us and demonstrating that and burnishing our credentials. So the dynamics of it for us are very good. We can afford to be selective. But we're always keen and eager and grateful for a new opportunity.

Thanks. Thank you. And now we're going to take our final question for today. And it comes from the line of Clive Lewis from Pure Hunt. Your line is open. Please ask your question.

Morning all. Probably one going back on the cash and sort of talking about or thinking about build rates As you sit here today, are you sort of thinking about changing, I suppose, the pace of build versus the pace of sales? Are you very happy with how that was going last year? That was the first one, I suppose, attached to that. When you sort of look ahead, you look at labour availability and I suppose the overhead structure of the business, how easy would it be for the group to respond and deliver a 10% or 15% increase in volumes if, a new mechanism from the government was announced or we did see an improvement in mortgage rates and demand profile.

So I suppose we're positioning ourselves to do exactly that should that happen. You know, timber frame being rolled out across the business and we're getting used to it. We'll probably be putting in a new line into the brick factory this year. We stepped up capacity in the tile factory last year and of course we're also looking you know we automated the robotic line in space 4 last year that was a big step up for us we had some you know we had some learnings from that but now that is now an efficient level of production and we'll step up again this year so we're trying to get ourselves into a position to exactly cope with that that step up in and of course we just delivered a 12% growth in completions and a bigger step up in EU build. So I think overall we're in a good place and then we'll keep pushing on with build-out rates this year so we can get ahead of the market. I want to be in the glorious position And as I know that all of my MDs will be listening into this, I want to get into the glorious position when we get to the end of November, I have no CMLs off of existing sites into December. So that will be a real achievement, won't it? I don't know if you've got anything to add to that, Anthony.

No, I mean, obviously, Clyde, look, we look at the build rates and sales. Of course, we keep looking at those. But as Dean says, we tried to get ahead on build. It helps with quality. It helps with predictability. And I think certainly as well in parts of the market, particularly Charles Church, it helps with sales actually. So we are getting after the bills, which is important.

Thank you.

So I think that's it. Thank you very much for listening to us today. Look, 2025 was a very strong year of organic growth for Persimmon and I think the business performed brilliantly and I'm very grateful to the teams for that. We expect 2026 to be another year of really solid growth. It is going to be driven by our strong pipeline of land opportunities as well as the strength and I think the diversity of our brands and our products and an unrelenting focus on operational excellence. So we're looking forward very much to another year of growth and another year ahead, and we shall update in March. Thank you very much for listening to us this morning.

This concludes today's conference call. Thank you for participating. You may now disconnect. Have a nice day.