Last checked at 12 Aug 2021 11:00
Publication of Annual Financial Statements 2021
A2Dominion Housing Group Ltd has today published its Annual Report & Accounts 2020/21, recording a turnover of £303.3m and a net surplus of £6.4m.
The full audited financial statements can be found in the following location:
https://www.a2dominiongroup.co.uk/about/reports-and-accounts
This has been a challenging year for the Group due to the Covid-19 pandemic. While we continued to provide essential services throughout and helped to ensure the safety of our customers and employees, our financial performance has been heavily impacted by the pandemic with a loss of circa £20 million of anticipated surplus.
While we were able to reopen our construction sites quickly and safely, social distancing slowed down work and longer build times delayed the completion of homes for both rent and sale. This inevitably reduced our revenue and increased our costs. Lower occupancy rates in our student and key worker accommodation, due to access restrictions and our decision not to charge rents where students were unable to occupy their homes, also impacted our rental income.
Despite the circumstances, we maintained a strong level of service during the year across the organisation, including at our extra care services where the residents rely upon our frontline care workers. We also maintained an uninterrupted repairs service throughout the year.
Our operating surplus fell by 12.3% from last year to £78.4 million, reflecting the higher operating costs from increased expenditure on our properties, particularly in relation to fire safety follow-up works. Our operating margin of 25.8% remained fairly steady, boosted by the operating profits from our development joint ventures which increased from last year. Our net surplus outcome of £6.4 million has been affected by higher interest costs and a fall in the values of our investment properties from last year. The fall in our investment properties is attributed to values being reduced by future fire safety costs needed on three of the schemes in our portfolio.
The organisation continues to be financially strong, with our core business achieving a strong result. Our social housing lettings delivered a 29.0% margin which, although down on the previous year, still compares well with our benchmark group. The Group forecast shows we are well placed in the next few years to show improved financial performance as well as being able to cope with any future unforeseen challenges. All banking covenants remain comfortably met.
Summary Financial Performance |
|
|
|
|
|
GROUP STATEMENT OF COMPREHENSIVE INCOME AND EXPENDITURE | 2021
£m | 2020 restated £m |
Turnover | 303.3 | 320.4 |
Cost of sales | (44.1) | (57.0) |
Operating costs | (207.2) | (192.1) |
Surplus on sale of fixed assets | 7.3 | 9.4 |
Share of jointly controlled entity operating profit | 19.1 | 8.7 |
Operating surplus | 78.4 | 89.4 |
Operating margin | 25.8% | 27.9% |
Net interest charges | (64.8) | (62.6) |
Change in fair value of investments | 0.8 | 0.5 |
Movement in fair value of financial instruments | 2.3 | (0.1) |
Movement in fair value of investment properties | (9.4) | (3.9) |
Taxation | 0.7 | 2.0 |
Non-controlling interest | (1.6) | (1.1) |
Net surplus for the year | 6.4 | 24.2 |
We built 754 homes, 72% of our target of 1,041 but 82% more than in 2019 (415). This included 153 shared ownership and affordable rent, 311 private sale (125 in joint ventures) and 290 private rent homes. We achieved 589 starts on site, which is 89 above our target of 500 homes. Just under 100 of these are joint venture schemes, while we are directly developing the rest. We secured detailed planning permission for 1,168 homes across seven locations and have sites secured for over 5,000 homes in our development pipeline over the next five years and beyond.
This year, we achieved customer satisfaction levels of 83% which is above our target. This score combines our customers' satisfaction with complaints, repairs and our customer contact centre services. This achievement can, in large part, be attributed to the additional focus and resource we placed on customer service during the pandemic, including calling customers with the greatest needs and providing reassurance and guidance about our services. As already mentioned, we also maintained a full repair service throughout, keeping customers' homes safe and running smoothly.
Darrell Mercer, A2Dominion Group's Chief Executive, said: "The pandemic has had a significant financial impact on the organisation and although we delivered a smaller surplus than expected, we continue to be financially strong.
"Operationally, we've also continued to deliver hundreds of new homes and have maintained high customer satisfaction ratings.
"Overall, we are in a very good position and well placed to deliver improved performance over the next few years."
Other achievements in 2020/21 included:
· Social value of £9m against a target of £7m
· Established a £400-million estate services framework to facilitate safety, remedial and improvement works for A2Dominion and our partners, including public sector organisations
· Fourth consecutive Investors in People Gold accreditation (since 2011).
GROUP STATEMENT OF FINANCIAL POSITION | 2021 £m | 2020 £m |
|
|
|
Tangible fixed assets and investments | 3,587.5 | 3,575.6 |
Current assets | 434.9 | 452.8 |
Creditors including loans and borrowings | (1,980.6) | (1,984.2) |
Deferred capital grant | (1,081.3) | (1,081.6) |
Non-controlling interest | (1.6) | (1.2) |
Total reserves | 958.9 | 961.4 |
A copy of the Annual Financial Statements has also been submitted to the National Storage Mechanism and will shortly be available for inspection:
https://data.fca.org.uk/#/nsm/nationalstoragemechanism
For further information, please contact:
Ellie Lodge
A2Dominion Housing Group
The Point
37 North Wharf Road
London W2 1BD
Tel: 07860 411202
Email: ellie.lodge@a2dominion.co.uk