TIDM15HG
RNS Number : 3657L
Great Places Housing Group Limited
12 May 2022
QUARTERLY PERFORMANCE UPDATE
Covering performance for the year ending 31 March 2022
Our Performance Updates are aimed at ensuring our investors and
other stakeholders receive regular, timely information regarding
the performance of the Group. We will publish these reports on a
quarterly basis and will produce them within six weeks of the
relevant quarter end.
The information included is based on unaudited management
accounts and other internal performance measures.
These results are published in advance of the Statutory Accounts
for the year ended 31 March 2022 which will be issued following the
AGM in September. The information included is based on unaudited
management accounts and other internal performance measures and is
subject to concluding the routine annual accounting adjustments as
well as any adjustments that arise as a result of the external
audit process. The final year end figures which will be used in the
Financial Statements will include adjustments for tax, pensions and
other fair value adjustments.
FINANCIAL PERFORMANCE: QUARTER FOUR RESULTS
The management accounts of Great Places Housing Group (the
Group) show a full year surplus of GBP19.9m (March 21: GBP14.8m),
almost exactly in line with budget. Total turnover for the year
(including 1st tranche and outright property sales) was GBP159.7m
(March 21: GBP137.7m) and operating surplus was GBP45.7m (March 21:
GBP40.2m). Rental income was slightly below budget due to delayed
handovers of new developments and operating costs were slightly
higher than budget due to increased investment in our homes. Covid
continued to be an adverse factor for much of the year,
contributing to development delays and also leading to higher than
planned absence which led to additional sub-contractor costs to
maintain repairs service delivery. We saw higher than planned
volumes of shared ownership staircasing and Right To Acquire sales,
whilst our open market and first tranche sales targets were both
exceeded.
Drawn debt (excluding bond premium, fair value adjustments and
loan fees and including finance leases) as at March 2022 was
GBP652.2m (March 2021: GBP661.1m) with the movement due to
scheduled loan repayments. A new GBP100M revolving credit facility
with RBS/Natwest completed in March 2022, renegotiating and
restructuring the maturing GBP85m existing facility, adding GBP15m
of new money and extending the maturity of the new facility to
2027.
The Group's Mark to Market exposure was GBP28.1m (March 2021:
GBP41.9m) with GBP8.0m cash collateral posted to meet
counterparties' security requirements (March 2021: GBP21.1m).
Cash balances (excluding cash held on behalf of leaseholders)
were GBP119.5m (March 2021: GBP135.4m) with undrawn bank facilities
immediately available of GBP143.8m, of which GBP73.8m is fully
secured and the remaining GBP70m subject to a release and recharge
exercise following the RBS/NatWest loan amendment and will complete
shortly.
Our internal financial "Golden Rules" around interest cover,
gearing and operating margin were all met at the end of the
period.
OPERATIONAL PERFORMANCE
Our performance management for 2021/22 centres around eleven
Critical Success Factors ("CSFs") which are designed to focus us on
the delivery of the Corporate Plan, and particularly our vision of
"Great Homes, Great Communities, Great People".
During 2021/22, performance against the CSFs continued to be
affected by the Covid pandemic. However, five targets were
achieved, with two CSFs also achieving their stretch targets
(Average Re-Let Time; and Households into Work, Training &
Volunteering). The other three CSFs that achieved their targets
were Higher Risk Building Safety; % of Digitally Active Customers;
and Colleague Engagement.
-- 557 affordable homes were completed during 2021-22, our
highest number in recent years. Being below the CSF target of 745
reflects the continued delivery challenges around labour,
materials, approvals and land registration. Demand for our shared
ownership and outright sales products remains incredibly
strong.
-- Customer Satisfaction was 7.0/10 against a target of 7.3/10
with services impacted by increased colleague sickness as a result
of Covid, with average days sickness absence per employee being
10.5 days (target 8.6 days). Customer satisfaction has shown
improvement in the latter half of the year.
-- The new data CSF achieved 79% at the end of March, missing
the CSF target but rising strongly through the year having started
the year at 58%. We expect to see this result move much closer to
the optimum levels following the successful implementation of the
new Aareon QL housing management system at the start of April 2022,
which marked the culmination of the two-year integration programme
following the Equity merger in April 2020.
-- Arrears at the end of March was 4.0% totalling GBP3.16
million against the year-end target of 3.8% (GBP2.96m). Whilst we
have just missed target, this is only the 2nd time this year where
arrears performance has been worse than last year. We expected
higher arrears due to high levels of inflation and soaring energy
costs which will disproportionately impact our residents , so the
impact on our CSF isn't surprising and reflects recent benchmarking
predictions.
-- Group surplus (draft figure) was GBP19.9m against a CSF of
GBP20.0m, as noted above in the Financial Performance section.
2022/23 BUSINESS PLAN
At its meeting on 5th May 2022 the Great Places Group Board
approved the 2022/23 business plan, which will be published on our
website once the FFR regulatory submission is complete. Highlights
in the plan include ensuring we have the resources to complete all
remaining building safety works in the next few years and to get
all our homes to EPC rating C by 2028. The business plan confirms
our commitment to deliver 11,000 new homes in the ten-year period
April 2020 to March 2030. It includes provision of GBP170m over 30
years which delivers a large proportion of our net zero carbon
commitments.
CORPORATE NEWS
These stories illustrate some of our recent activities,
particularly in terms of Environmental, Social and Governance.
ENVIRONMENTAL
Bowland House project reaches completion
Work on the GBP3.4million refurbishment of Bowland House, the
14-storey high-rise close to Blackburn town centre, has recently
reached completion. As well as building safety work, the project
has involved improvements to the energy efficiency of the building
with new insulation of the external walls and hot water
systems.
Carbon standards in new build homes
In February the Executive Team approved our strategic approach
to meeting enhanced carbon standards in new build homes. This was
the culmination of a 12 month project, working with the Building
Research Establishment, which equipped us with the knowledge and
evidence base to make informed decisions which reflect our carbon
commitments and commitments to our customers around sustainability.
Following the setting of strategic direction the project will move
into its next phase of creating detailed technical specifications
and designs which will meet future carbon standards alongside the
needs of customers and the wider organisation.
Carbon Literacy Team complete training of Great Places and Cube
Board members
Our Carbon Literacy training team has recently completed
delivering training to all Board members of the Great Places Group,
including Cube Homes Board members. In addition, the team has
continued to deliver training to a range of organisations. These
have recently included Bolton at Home, London Fire Brigade, Pozzoni
Architects and St Helen's Council.
SOCIAL
Social Value Campaign with suppliers provides GBP10k to support
customers
Great Places' Cheery Christmas Social Value campaign saw Great
Places' suppliers Engie, Forbes, Devonshire's, Casey and Kier
contribute GBP10,000 to provide various support packages and events
including food parcels, presents and activities to various
neighbourhoods and schemes.
Blackburn College apprentices get work experience on our
Lancashire improvement works
Our Investment Team recently teamed up with Blackburn College
students to give 15 young apprentices on its construction course
the chance of valuable work experience needed to complete their
college based apprenticeship. Working with contractors John
Southworth, the young people supported with kitchen and bathroom
upgrade works taking place in the local area, getting the vital
experience needed for getting that all important first job.
Great Places teams up with ReelMcr on knife crime film project
in Salford
Great Places recently teamed up with ReelMcr, a community based
drama and participant-led social history documentary film makers,
to work with young people in Salford to make a documentary about
the impact knife crime in the area. The 12-week project, funded by
Great Places and GBP10,000 from Engie as part of its social value
commitments, was an opportunity for the young people involved to
develop their film making skills. The young filmmakers will also
have input on the direction and final content which will be
launched later this year.
GOVERNANCE
Senior staffing changes
In February 2022 Helen Spencer was promoted to the role of
Executive Director of Growth. She will be responsible for the
delivery of Great Places' GBP1bn affordable housing development
programme and the management of key stakeholder relationships like
the recently announced Homes England Strategic Partnership. Helen
will also be responsible for leading the Group's Plumlife sales
team, will oversee the GBP750m Innovation Chain North construction
framework and the growth of Great Places' in-house building
contractor, Terra Nova Developments Limited.
Nick Gornall, formerly Head of Development, has subsequently
been promoted into Helen's former Director of Development role.
Caroline Millington has been promoted to the new role of
Director of Private Sector Development and will lead our Shared
Ownership, Leaseholder and private sector management
activities.
In April the Group received the sad news that Sharon Hayes,
Director of Technology Services had passed away following a short
illness. Sharon had made great steps in improving the Group's IT
infrastructure and played a major role in the Aareon QL systems
implementation referred to earlier. Our thoughts are with Sharon's
family and friends.
Great Places agrees GBP100m funding deal
Great Places has secured a GBP100m funding deal that will
support its plans to deliver 11,000 affordable homes by 2030. The
finance package, agreed with NatWest, is a Revolving Credit
Facility (RCF) and consists of GBP85m refinancing of existing debt
and GBP15m new debt. The deal consolidates existing loan funding
held by Great Places and the former Equity Housing Association,
that pre-dated their merger in April 2020, into a larger and longer
term revolving credit facility with more competitive margins and
improved covenants.
Planning approved on Laystall Street homes in Manchester city
centre
In February, Manchester City Council granted planning permission
for our development on Laystall Street, located just off Great
Ancoats Street in Manchester City Centre. Great Places is working
with Manchester based developer McCauls to jointly deliver the
development which will see the creation eighty-nine new homes in a
nine storey development, and 8,000 sq. ft of work space at the
site, which includes the Grade II Listed 32-34 Laystall Street
Armitage Showroom building.
GBP10m Ancoats Dispensary project officially begins
Councillor Bev Craig, Leader of Manchester City Council, joined
Great Places Housing Group at the end of February to mark the
official start of work on the GBP10 million redevelopment of the
iconic former Ancoats Dispensary into 39 affordable homes. Cllr
Craig and local Ancoats and Beswick councillor Cllr Majid Dar were
joined by Great Places' Chief Executive Matthew Harrison at the
site of the former hospital, set to be transformed into 39 one and
two bed apartments available for affordable rent. The plans,
delivered in partnership with Manchester City Council, the Greater
Manchester Combined Authority (GMCA), Homes England, and
Contractors Eric Wright, will look to preserve as much of the
original Grade 2 listed facade as possible.
Great Places hosts Blackburn councillors on tour of new
developments
Great Places recently hosted a visit of local councillors to
officially cut the ribbon on their new GBP19 million housing
developments across Blackburn. In total, 138 new homes have been
built with 123 of those being offered for affordable rent and 15
offered for sale through shared ownership on sites at Shakespeare
Way in Griffin as well as at Bowen Street, Shorrock Lane and New
Wellington Street in Mill Hill - which has a road named after
former Blackburn Rovers and England striker Fred Pickering who
lived in the area.
FEEDBACK
We welcome feedback on our performance update. Please contact
Phil Elvy, Executive Director of Finance, at
communications@greatplaces.org.uk
The information included within this report is for information
purposes only. The Financial results quoted are unaudited. The
report may contain forward looking statements and actual outcomes
may differ materially. No statement in the report is intended to be
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END
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