Liverpool-based landlord increases operating margin after sale of loss-making care business Baycroft
Riverside has moved back into surplus and improved its operating margin.
The 69,000-home association reported a surplus of £10.1m for the year to 31 March, up from a restated deficit figure of £15.2m the previous year. The group has previously cited challenges relating to its merger with One Housing, cladding remediation and the need to exit loss-making activities such as the Baycroft care business among the reasons for deficits in the two previous years.
The latest accounts show the group’s operating surplus, which excludes one-off costs, has jumped 56% from £69m to £108m. Its turnover rose 6% from £648m to £686m, boosted by an extra £33m in income from social housing lettings.
The group increased its overall operating margin from 8.6% to 12.2% year-on-year, exceeding its target of 12%. The increase was driven primarily by a £22m increase in surplus from social housing lettings, along with the sale of its loss-making care business Baycroft.
Riverside completed 980 homes in the year, which brings it back to the roughly 1,000 homes a year rate it was achieving before last year’s figure of 1,479, which chief executive Paul Dolan has previously told Housing Today was an “outlier.”
Writing in the report, Dolan said one of Riverside’s biggest achievements has been the” near completion” of the group’s integration with 17,000-home One Housing Group, which has given the landlord a bigger presence in London.
He said: “When we began this process three years ago, we said we would be stronger together, and we’re now starting to see the longer-term benefits. As a result of the merger, we’ve started to see improvements in our financial position, customer engagement, and real momentum in our cladding remediation programme, which remains on track for completion by 2028.”
The group’s previous years figures for surplus were restated in the accounts due to a change in the level of recoverable service charges costs.
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