Housebuilder Persimon Homes, which has offices in Warrington, Sandbach and Lancaster, today announced 1,100 job losses as it restructured to meet the "most challenging period" in its history.
The company said legal completions on house sales was down 31% to 5,501 in the six months to 30 June 2008. The average selling price was £181,500 compared to £189,255 in the first half of 2007. Total sales revenue for the period was £1bn, a reduction of 34% on the first half of last year.
Today's trading statement added that there was increasing pressure on margins, now standing at 14% before goodwill and exceptional costs. Margins in the same period last year were 20.8%.
In January, the firm merged the Sandbach office of Charles Church North West with Persimmon Homes Mercia, also based in Sandbach, with the loss of 19 jobs.
Details of the regional breakdown of job losses is expected to be announced later today.
The restructuring is expected to generate a cash saving of £45m a year.
On a more positive note for shareholders, the company said it did not anticipate having to make a write down on land values. This reflects the fact 80% of its 76,000 plots held were acquired prior to 2007 at below market value and provide margin protection.
However, build activity has ground to a halt and development spend on new stock is likely to reduce further.
Persimmon's net borrowing at the half year was £900m, which represents a gearing of 39%, "comfortably within our committed facilities of £1.39bn", it said.
Shares in Persimmon were down 10p at 218p in early trading, valuing the business at £708m. In August 2007 the share price was over 1200p.