Persimmon’s founder and chairman to retire

Davidson announced his retirement at the company’s annual meeting last Thursday in York. He will become life president when he steps down as chairman at the next meeting in April 2006.

He founded the company in 1972 and floated it on the stock market in 1985. Since then, its market capitalisation has grown to more than £2bn and is on the verge of entering the prestigious FTSE-100.

It is presently ranked at 105.

At the meeting, Davidson also announced the company’s succession plans. John White, Persimmon’s group chief executive for the past 12 years, will take over as chairman. Commenting on White’s promotion, Davidson said: “The board considers that the company and its shareholders would benefit from his continuing involvement in the group.”

Since White took over as chief executive, pre-tax profit has risen from £10m to £470m and earnings per share have grown from 7.3p to 113.9p.

Davidson said: “White’s appointment is being made after consultation with a number of our larger shareholders, who are supportive.”

White will be replaced by Mike Farley, who is chief executive of Persimmon’s southern division and who has been with the company for 21 years.

The City has been impressed with White’s stewardship of the company. Despite the fact the housing market has slowed in the past year, in March Persimmon increased its full-year dividend 50% to 27.5p when it announced its 2004 annual results. It had already secured £1bn of forward orders for 2005.

Updating shareholders at the meeting, Davidson was upbeat about prospects for 2005 and said that the company was in line to meet expectations.