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Profit and turnover up at Wates Group
A leading social housing contractor and house builder has reported a rise in turnover and profits in its 2017 accounts released this morning.
Wates Group’s results for 2017 showed a 5.9% increase in turnover to £1.53bn from £1.62bn and profit before tax up 0.7% to £35.7m.
The company, which carries out repairs and maintenance services for many social landlords as well as building and developing homes, saw its order book hit a record £5.1bn heading into 2018.
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It built 5,000 homes last year, in a combination of work with housing associations, contracting work for house builders and development through its own joint ventures.
James Wates, chair of the company, told Inside Housing this figure had been rising steadily over the past two years.
He said: “It works to the priorities of local and national government and what our clients are trying to achieve.”
On the repairs and maintenance side, he said the company had been profitable and beat its budget, but added that the market was still challenging following 2015’s rent cut.
“It remains a very competitive sector. Until a lot more social housing is created we are dealing with a fixed market and there has been no real consolidation among competitors,” he said.
“Lots of housing associations and local authorities are looking carefully at how they prioritise spend.”
He said that in the second half of 2017, following Grenfell, social landlords moved planned spending towards fire safety – but added that Wates had picked up some of this work.
“We are seeing a change in the way budgets are allocated – a lot of local authorities and housing associations are redirecting spend from what has been bathroom and kitchen improvements into fire safety,” he said.
“As they have made that switch there has been a slight delay in orders coming through, but not a material one. We are helping in a number of areas to take cladding off buildings – we think we are trusted as part of the solution.”
The company finished the year with cash of £169.5m at bank. Its residential developments turnover increased by 0.4% to £206.1m and property services turnover was £477.3m, up 11.0% from 2016.
Last week, Wates was announced as partner on the major £1bn joint venture to regenerate 12 estates in Havering.