Persimmon makes 1,100 UK job cuts

Published 08th Jul 2008

UK housebuilder Persimmon says it has shed about 1,100 jobs since the start of the year as it tries to deal with the downturn in the housing market.

Completions of house sales in the first six months of the year were down by 31% it said, during the "most challenging period in our recent history". Difficulty getting mortgages and lower confidence had hit business, it said.

Meanwhile Persimmon, which has seen its shares sink in line with other housebuilders, lost a further 6%.

Last month, the decline in Persimmon's share price meant that it was demoted from the FTSE 100, the share index which contains the largest UK-listed companies.

Industry trend

Persimmon said that its job cuts would save about £65m per year, meaning it could cope "efficiently" with its downturn in business. Revenue was down 34% amd sales on its order book were 30% lower than at this time last year, it added.

"We now have a lower level of overheads and structure appropriate for the current levels of business, whilst at the same time remaining well placed to achieve an increase in output whenever mortgage availability and the overall market improves," the firm said.

Persimmon is the latest housebuilder to cut jobs, with 2,000 jobs going at rivals Taylor Wimpey and Barratt Developments.

Last week, Taylor Wimpey shares more than halved in value after the firm announced 900 job cuts and said it had failed to secure an extra £500m of funding.

And Barratt is shedding up to 1,000 jobs in another blow to the troubled UK property market.

Source: ' 'bbc' '

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