London Markets: U.K. builder stock skids after disappointing quarter and CEO exit

In its fiscal first quarter, its adjusted operating profit slumped to £16.5 million ($23 million) from £24 million, as revenue dropped to £249.8 million from £363.8 million. Countryside hadn’t published a first-quarter outlook, but guided for an adjusted operating profit as high as £210 million in the current fiscal year.

“You think about our purpose, our purpose is to build really high quality homes in places that people love at the affordable end of the market. We do that very well. We just want to be doing more of it,” said John Martin, the chairman who will serve as interim chief executive after the departure of Iain McPherson. McPherson is leaving by “mutual agreement,” the company said.

Martin said he was still trying to get to the bottom of why the company struggled. He told analysts there were planning delays and trouble getting onsite in light of coronavirus restrictions, “but I wouldn’t want to overplay those.” On labor issues and materials shortages, he said they were specific rather than broadly based. “The market is good,” said Martin.

Persimmon
PSN,
-1.83%
meanwhile missed its home completion target for the year, as they rose 7% instead of its 10% target, sending shares down 2%. Its margins for the year will be about 28% from 27.6%, which Persimmon said were industry leading.

“Whilst the industry continues to face the ongoing operational and economic challenges as a consequence of the pandemic, particularly as the omicron outbreak unfolded in the last six weeks of the year, the group continues to manage these ongoing challenges comprehensively,” said CEO Dean Finch in a statement.

The broader FTSE 100
UKX,
+0.13%
drifted 0.2% lower in midday action, after hitting a two-year high on Wednesday. The rise in bond yields has helped the U.K. benchmark index advance this year, due to its value-heavy composition of financials, energy and resource sector stocks.