Strong growth

Significant opportunity for multi-year double digit growth from new and existing regions in the UK market

Our approach

  • Growth in sites under construction and open sales outlets
  • Accelerated build from mixed-tenure delivery
  • Private selling prices set to target areas of strongest demand
  • Business development solely focused on Partnerships
  • Revenue growth from increased volume

2021 highlights

  • 44% of completions from private homes
  • Private ASP to £380,000 as a result of some house price inflation within both the Partnerships and Legacy Operations business
  • Growth in the new South Midlands and Yorkshire regions, contributing 710 units
  • Conclusion of strategic review with 100% of new business development on Partnerships

Outlook

  • Sustainable growth as new regions announced in 2020 and in the Home Counties develop to maturity
  • Focus on the continued growth in sales outlets
  • Continue to focus product on areas of strongest demand
  • Manage sales values to maintain affordability
  • Target net reservation rate between 0.6 and 0.8
  • Flex the tenure mix depending on levels of demand

 

61

average open outlets during 2021

 

0.74

net reservation rate within our target range

 

+33%

completions

 

Attractive returns

High ROCE can be generated from our capital-efficient mixed-tenure strategy and efficient development approach 

Our approach

  • Focus on improving operating
    margin over the medium term
  • Improved operational
    efficiency from greater scale
  • Use of modular panel
    construction to increase
    asset turn
  • Lower capital model to
    deliver higher returns
  • Agile model allows
    flexibility through the
    cycle, protecting returns

2021 highlights

  • Adjusted operating margin increased by 550bps to 11.0% reflecting changing mix of business and recovery from Covid-19
  • 1,150bps increase in ROCE reflecting the recovery from the Covid impact in the prior year
  • Commitment to return £450m of cash from legacy operations to shareholders via share buyback programme

Outlook

  • 100% Partnerships focus
  • Return to target operating margins across the Group
  • Improve operational efficiency through greater scale
  • Maintain capital discipline to drive ROCE improvement
  • Investment in growth while managing gearing levels
  • Maintain a conservative approach to net debt and invest in Partnerships growth. Reinvestment to take precedence over shareholder returns

 

£167.3m

Operating profit

 

11.0%

Adjusted operating profit

 

18.6%

Return on capital employed

 

Positive social impact

Our focus is on affordable homes to buy or rent and the creation of mixed and balanced communities – places people love

Our approach

  • Mixed-tenure development,
    with private, PRS and
    affordable homes
  • Experts at regeneration
    and working closely
    with communities
  • New developments created
    with our placemaking
    expertise focused on
    long-term positive outcomes

2021 highlights

  • Measured social impact on all
    our developments
  • £1m Communities Fund into
    second year
  • £243m of social value
    generated, equivalent to 16%
    of adjusted revenue
  • Launched our new Building
    Communities strategy

Outlook

  • Grow the Partnerships
    pipeline of future work
  • Continue to focus on
    mixed-tenure developments
  • Continue measuring social
    impact of our developments
  • Communities Fund retained
    for another year

 

56%

of home were affordable or PRS

 

£243m

of social value generated

 

91.6%

NHBC recommended a friend score

 

Unceasing focus on sustainability

We re-use land whenever possible, and build high‑quality low-maintenance homes in the most sustainable way, leveraging our significant investment in MMC

Our approach

  • Record of incremental
    environmental impact reduction
    and social value generation
  • Strong culture of ethical and
    responsible decision making

2021 highlights

  • Launched new approach
    to sustainability
  • Set science-based targets
  • Launched pathway to net
    zero report
  • Made further progress
    in modular construction

Outlook

  • Committed to Task Force on Climate-related Financial Disclosures disclosure by 2022
  • Report the changes needed in
    the regulatory environment to
    the Sustainability Committee,
    particularly the use renewable
    heating systems in homes and
    net biodiversity gains on sites
  • Continued investment in
    modern methods of
    construction including
    modular panel capabilities

 

53%

development built on brownfield land

 

99.5%

site waste diverted from landfill

 

16,605

plots owned and with planning

 

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