Network Homes produces another strong set of financial results for 2017/18
Turnover was stable at £234m, with an operating margin of 30%. We increased reserves by £45m to over £372m and we have a solid development pipeline of 3,000 homes through to 2022. Our net operating surplus of £44.3m will be fully reinvested into new homes and better services.
The surplus is slightly lower than for 2016/17, due to a smaller sales programme, absorbing the 1% rent cut, and making substantial investments in our business.During the year we invested another £88m in new development activity and existing homes. We completed 284 new homes, with 79% of these for social and affordable rent or shared ownership, and a further 270 homes were practically complete but not yet handed over at the year end. We also started on site with 773 more new homes.
Overall resident satisfaction rose from 85% to 87%. This is the second highest of London’s g15 largest housing associations. Sickness and staff turnover remained below g15 average levels, showing the strong engagement of staff in supporting our social and corporate objectives as the new Network Homes.
This is a healthy set of results in a year of considerable financial challenge. With the rent cut continuing, further investment to come in our business systems and in a substantial development programme, the roll out of Universal Credit gathering pace in our main areas of operation, a more subdued sales market, and the ongoing consequences of the cladding and other fire safety issues, we expect surpluses to remain somewhat subdued over the immediate future. We are, however, focusing hard on developing more new homes and improving the efficiency of the business.Barry Nethercott, Network’s Executive Director of Finance & Governance