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Persimmon chief executive retires as company announces restructure

Persimmon chief executive Mike Farley has announced he is to retire, as the business said it was simplifying its structure from three operating divisions to two.

Group managing director and CEO of the northern division Jeff Fairburn will succeed Mr Farley as CEO.

Persimmon also said it would restructure from three operating divisions in the north, central and south, to two divisions in the north and south.

The housebuilder said its 24 operating businesses will be evenly split between the divisions.

The move was announced as Persimmon reported a 12 per cent increase in revenues to £1.72bn for 2012, on the back of a 6 per cent rise in selling prices.

The volume of new completions increased by 6 per cent on the year, to 9,903 from 9,360 in 2011

Mike Farley

Mr Farley served as chief executive for seven years, having worked at Persimmon for 23 years before that period.

He will resign at the company’s AGM in April.

Hailed by Persimmon chairman Nicholas Wrigley as having made an “enormous contribution” to the business.

In a statement, the company said “the new simplified structure” would create “operational efficiencies and synergies across the Group.”

The firm said the FirstBuy scheme’s renewal on 26 September had strengthened first-time buyer interest.

Persimmon’s underlying operating margin also strengthened, with an expected increase of 13 per cent in 2012. Forward sales at year end totaled £645m, and 9,400 plots of new land were acquired in the second half of the year, bringing the land bank to 68,000.

In other board changes, south division chief executive Nigel Greenaway will join the board as an executive director, while Marion Sears has been appointed non-executive director.

Neil Davidson CBE, who has served as a non-executive director since January 2004, will retire from the board at the 2013 AGM.

Chairman Nicholas Wrigley said Mr Farley had been an “outstanding” chief executive and had “made an enormous contribution to the development of Persimmon.”

“The announcement in February 2012 of our new long term strategy and £1.9 billion capital return plan over nine and a half years is a testament to his strong leadership, strategic clarity and long-term planning. He will leave Persimmon with our gratitude and best wishes for his retirement.”

“Jeff Fairburn is a talented and experienced executive who knows the Persimmon business extremely well. He played a key role in the development of the new strategy and will now play the central role in its delivery.”

Mike Farley said: “It has been a great privilege to be Group chief executive for the last seven years. The company is in great shape and well positioned to deliver on our new strategy, and I’m confident that it will become an even stronger and bigger business over the coming years.”

Regional chairman Dave Jenkinson is also being appointed North Division chief executive.

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