(Correcting revenue figures and deprecation and impairment charges).
LONDON (Alliance News) - Ashley House PLC on Wednesday said its revenue more than doubled in its financial year ended April 30, and it swung to profit, though noted its pipeline was being delayed as the UK government reassesses its benefit policy on elderly and vulnerable people.
Ashley House, which provides design and construction management services to health and social care development projects, posted pretax profit of GBP241,000 for its financial year, compared to the GBP11.9 million loss it recorded a year earlier. This came as the company's revenue more than doubled to GBP20.7 million, from GBP8.4 million, and the deprecation and impairment charge declined to GBP1.5 million from GBP7.6 million.
Ashley House said it has completed its first Extra Care scheme in Grimsby during the year and signed a funding and partnership agreement with Funding Affordable Homes and the funder's property advisor, SHA Housing Ltd, in September.
The Extra Care developments are for elderly or vulnerable people which had meant that expected returns on new social housing developments funded with third party finance was depressed during the year, following the Chancellor of the Exchequer's announcement in the Autumn Statement that housing benefit for tenants would be limited to the local housing allowance rate from April 2018 for new or renewed tenancies taken out from April 1.
This meant new build projects were delayed while funders and local authorities sought clarity on the cap issue, including those Ashley House was involved with, and the company said its pipeline within the Extra Care segment, of 18 schemes, has been delayed during the year.
The government has now said it believes the rental cap does not work for sheltered and supported housing and is seeking a resolution to this issue, which Ashley House said it expects will unlock its pipeline.
Meanwhile in the Health division, Ashley House said it was beginning to see "some limited activity" return in the segment after a number of fallow year.
"Clearly the resolution of the LHA cap is a key issue for the business, although the company continues to work with local authorities, registered providers and our specialist funder FAH to find alternative and innovative ways of working together irrespective of how this issue is resolved," Chairman Christopher Lyons said.
Shares in Ashley House were up 9.3% at 8.20 pence on Wednesday.
By Hannah Boland; hannahboland@alliancenews.com; @Hannaheboland
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