Network Homes announces financial results for 2019/20
27 August 2020
We've released our financial results for 2019/20, which demonstrate how our financial strength enabled us to invest £234.3m in new development activity during the year.
We started 590 new homes, all of which were for affordable tenures and submitted our largest ever planning application to build 1,600 homes on land acquired at Northwick Park Hospital in Brent, which will be a major contribution to the wider masterplan for the area. Network’s development pipeline to 2023 will deliver over 2,800 new homes across London and the south east. We also invested £16.3m during the year on maintaining and improving the standard of our existing homes.
The results show a net surplus of £21.1m, all of which we'll reinvest into new and existing affordable homes. Turnover decreased by 25% to £205.7m and the operating margin decreased by 10% to 25.8%. Reserves increased by £31m to over £466m. These results are reflective of our increased spending on building safety and 2018/19’s exceptional results, which were largely due to the sale of a block of student accommodation by Student First, a Network subsidiary.
Building safety continued to be a major priority for the business during the year, and we established a dedicated building safety team to lead Network’s response to government guidance and coordinate investigations, interim safety solutions where necessary, and remedial work for around 70 Network owned buildings and a number of others where we are the leaseholder. This is likely to continue to be a major source of expenditure for our business in the coming years.
The overall asset base rose to £2,007m (£2bn) and gearing increased slightly to 53%, demonstrating our commitment to delivering on our strategic objective of maximising growth within our resources by continuing to build much needed new affordable homes.
During the year we implemented a new fifth strategic objective of strengthening residents’ trust in the organisation, with an underpinning ambition of improving trust in Network by 10% year on year, making resident engagement and transparency a top priority for the business. Network’s Board also took the decision to launch a new charitable fund for 2020/21 with a budget of £100,000 to help support the neediest in society.
I am proud of how Network Homes has performed in what can only be described as difficult and uncertain times. The need for safe, secure and affordable homes in high demand areas remains as strong as ever. We are focused on the safety of our residents and are allocating our resources accordingly with increased investment into building safety works. Network’s greatest strengths have always been its adaptability, financial stability and its people and with these in place we can be confident we can continue to meet that need despite the huge challenges we face.Helen Evans, Chief Executive of Network Homes