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Midlands association boosts surplus by nearly £10m
Midlands housing association Longhurst increased its surplus by nearly £10m last year following a board restructure, its financial results show.
The 21,000-home landlord achieved a surplus of £17m before tax in 2016/17, compared with £7.2m the previous year, with £2.8m generated through sales.
It had an operating margin of 36.4% in 2016/17 – up seven percentage points on the previous year.
Operating costs were slashed by £4.6m from £65.5m in 2015/16, helped by value for money savings of £1.8m.
Turnover for 2016/17 was £110.8m, down slightly on £112.9m in 2015/16.
Longhurst made changes to its group structure in 2016/17, bringing together the boards of its three member companies – L&H Homes, Spire Homes and Friendship Care and Housing – to sit around one table as a new “Homes Board”.
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Rob Griffiths, deputy chief executive and chief financial officer at Longhurst, said: “Being able to continually improve the way we operate as a business helps us ensure longevity and ongoing success, as we aspire to deliver 3,000 new homes over the next five years.
“These results show that our new streamlined governance structure is helping us to realise these ambitions.”
Longhurst built 406 new homes in 2016/17, with 254 for social, affordable or intermediate rent, 146 for low-cost ownership and six for market sale. These units were delivered with £40.8m of investment, of which £576,436 was government grant.
The association expects low-cost homeownership to account for 60% of its output in the future.
It agreed a merger with 2,300-home Axiom in May, which it hopes will see it deliver an extra 100 homes a year.
Longhurst’s net debt stood at £465.3m at the end of March, with gearing of 50.1%. Its social housing business still accounts for 95.1% of its income.
Update: at 12.16pm, 15.08.17 The story was updated to include additional figures.
