Persimmon, the UK’s second biggest housebuilder, has suffered a £780m pretax loss in 2008 due to £652.3m of writedowns on the value of its land bank and properties.
In its preliminary end of year results this morning, it said the average house sale price fell by 8.7% in the last year, and forward sales dropped 34% from £1.05bn in 2007 to £697.5m.
It said that in light of current trading conditions, it would not be paying a final dividend.
The company also said it had renegotiated its existing debt and had agreed terms on a new £322m debt facility at an increased interest payment of 6.4% - an increase of 2.8% on its previous terms.
It said that this would provide funding lines of £1.09bn, reducing to £560m in 2011, and would create ‘ample headroom and support for the effective management of the business over the next few years’.
Net borrowings were at the end of the year were £599m compared to £721m at the same period in 2007, and its net assets fell from £2.35bn to £1.55bn, equating to a gearing of 39%.
Chairman John White said: ‘It is well documented that 2008 was the most challenging period encountered in the housing market in recent history. During the year we have restructured our business significantly across the whole of the UK and have recently new and amended credit facilities to provide further stability as we move forward through these difficult markets.’
Persimmon’s shares rose 5.4% this morning to 366p on the back of the results.