GREAT PLACES HOUSING GROUP LIMITED

£345,000,000 4.75 per cent Secured Bonds due 2042 (ISIN Number XS0842152281)

ANNUAL REPORT AND FINANCIAL STATEMENTS FOR YEAR ENDING 31ST MARCH 2022

At the AGM of Great Places Housing Group Limited ("Great Places") on 22nd September 2022 the shareholders agreed and adopted the Annual Report and Financial Statements for the year ending 31st March 2022.

Turnover for 2021/22 was £166M, up by 15.2% from the £144.2M recorded in 2020/21. The increase was driven by higher rental income as well an increased number of shared ownership and market sales.  

Operating surplus of £46.8M was 16.4% higher than 2020/21. Operating margin declined slightly to 25.3% from 25.8% (as defined by the RSH VFM metric). The reduction was mainly due to the increased proportion of shared ownership and market sales, as well as one-off merger/integration costs and building safety costs.

Total surplus after tax excluding the gain on transfer of engagement recorded in 2020/21 increased from £14.8m to £21.6m.

Turnover from social housing lettings was £114.8M (2020/21: £109.9M).

Turnover from shared ownership first tranche sales and open market sales was £40.0M (2020/21: £23.7M).

Total Fixed Assets were £1.41bn (2020/21: £1.36bn).

Total debt was £702.9M (2020/21: £713.5M). 

In the two years following the merger with Equity Housing Group, Great Places' internal focus has been the "One business" integration programme which completed as planned at the end of 2021/22. By that time, we had completed the implementation of a new housing management system and realigned our operational structures. The merger allows the Group to deliver a stronger customer service offer and become financially stronger and more resilient, with the merger business case savings of £3m per annum now largely feeding through. Great Places is one of the North of England's largest providers of shared ownership and leasehold services following the merger and is implementing a "Centre of Excellence" model for this significant business stream.

The Regulator of Social housing (the "regulator") graded Great Places as G1/V1 in July 2021 following an in depth assessment. The rating clearly shows that the regulator is confident that we continue to have strong governance, strategic business planning and stress testing arrangements in place.

We have also maintained our credit ratings with Moody's and Fitch which remain unchanged (A3 stable and A+).

Operational performance remained strong despite the external pressures following Brexit and the Covid pandemic around labour availability (both directly and through our supply chain), rising material costs and increasing energy costs. We saw relet times for our homes improve to 19.4 days in the year to March 2022 (21.9 days in the previous year).

We had expected that general inflationary pressures and the pandemic to have a significant increase in tenant arrears, but this was mitigated by support provided to our tenants through the temporary Universal Credit uplift and our Hardship and Community Resilience Funds which provided financial support to community-based projects and other customers.  We recognise that the current cost of living crisis will put increased pressure on arrears performance.

Customer safety remains paramount. Both our accredited gas safety checks and compliant fire risk assessments are at 99.9%. We continue to assess our buildings and carry out works to meet evolving building safety legislation. We've identified a small number of properties within our property portfolio that we have assessed as being higher risk and are well advanced in undertaking intrusive surveys and then delivering all required remedial works as soon as possible afterwards. We expect to spend a further c£16M to complete the ongoing programme of building safety work by 2024.

We continue to carry out work to improve the EPC ratings of our properties to ensure that we meet our target of a minimum of EPC C in all our homes  by 2028.  We have assessed the significant cost relating to achieving zero carbon across the portfolio in the longer term and through to the 2050 deadline, albeit Great Places starts from a strong position in respect of the age profile of the stock, and have made a significant allowance in our business plan to fund a large proportion of this cost.

During the year we completed 557 much needed new affordable homes and now own or manage 24,908 homes across the North West and South Yorkshire. 

Our ambitious development plans are key to our growth strategy and to helping meet the housing crisis.  Great Places are therefore pleased to have been awarded Strategic Partnership status by Homes England which will support the development of 4,920 units with £240.8m of grant as part of the Affordable Homes Programme 2021-26.  This additional funding will support our target of 11,000 new homes over the first ten years following the merger. We are currently live on 35 sites building 1,505 new homes. The Development programme has experienced difficulties with labour shortages and material costs increases, but are continuing to generate a strong pipeline of schemes. 

As a profit for purpose organisation, we ensure that all our surpluses are invested in line with our values and to meet our vision of "Great Homes, Great People, Great Communities".

The Financial Statements for Great Places are available on our website at:

https://www.greatplaces.org.uk/about-us/corporate-and-investor-information/financial-accounts

The Annual Report is also available on our website at:

https://www.greatplaces.org.uk/about-us/our-reports/annual-report-2022/