But turnover and operating surplus up
The Guinness Partnership missed its completion targets by a wide margin and recorded a pre-tax deficit in its most recent financial results.
The 70,000-home provider said its financial performance had been adversely affected by impairment charges of £21.4m, while its failure to hit even 70% of its development target was attributed in part to the collapse of key contractors.
According to results for the year ended 31 March 2025, the housing association’s turnover increased from £459.8m to £534.7m, with 85% generated by social housing lettings. Its operating surplus was also up, from £69.4m to £71.2m.
The 699 new home completions were an increase on the previous year’s 608, but well below the targeted 1,055.
Its 347 new housing starts were also below its target of 576.
“We completed fewer homes than originally targeted as contractor failure, planning delays and viability challenges on some sites has also led to some schemes progressing more slowly than anticipated,” it said.
Guinness had 3,024 homes on site at the end of the year.
“In common with others across the sector, a number of our contractors fell into administration during the year, causing delays and rising costs on some schemes, as well as in some cases impairments which are recognised in these financial statements,” it said.
Impairment charges resulted in a hit to surpluses. Guinness recorded a pre-tax deficit of £10.5m, a huge drop from surpluses of £68.2m the year prior - although 2024’s figure included the gain on the initial recognition of Shepherd’s Bush Housing Association’s merge into the group.
>> Read more: Shepherds Bush folded into Guinness as ‘full’ merger completes
Guinness said the £21.4m of impairment charges in this year’s accounts reflected “a combination of lower sales values and increasing construction costs, and delays to completion of schemes”..
Building safety costs and future obligations recognised in the income statement amounted to a further hit of £37.3m, while net financing charges increased from 65m to £81.8m.
It said that the deterioration in surplus and margin also reflected the early impact of the Shepherds Bush merger, with the then-subsidiary reporting a loss on social housing activities of £10m, primarily due to building safety work. Guinness said this had been anticipated on merger.
Guinness completed the transfer of engagements from Shepherds Bush Housing Association in March this year.
During the year Guinness invested £206.3m in maintaining and improving residents’ homes, an increase from £178.8m. It also invested £197m in new homes.
It said its investment in existing homes had resulted in its low EBITDA-MRI interest cover, which was nonetheless up on last year - from 27.5% to 31.3%.
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