LiveWest Treasury PLC 6 Month Trading Update and Sustainability Report (2327S)

TIDM76FQ

RNS Number : 2327S

LiveWest Treasury PLC

09 November 2023

LiveWest Trading Update for the 6 months ended 30 September 2023

LiveWest issues its unaudited group trading update for the 6 months ended 30 September 2023, with comparatives to the unaudited position for the 6 months ended 30 September 2022 and audited position for the 12 months ended 31 March 2023.

Sustainability Reporting Standard

We are pleased to announce the publication of our Sustainability Report for 2022/23 . The report can be obtained by clicking the link or accessing our sustainability page at https://www.livewest.co.uk/about-us/sustainability.

Financial and Operating Performance

Turnover for the period of GBP150m is comparable to 2022 (GBP151m) with higher rental and social income of GBP12m being offset by lower current asset sales receipts of GBP13m . While we are experiencing a more challenging sales market , we remain confident that we will meet our profit targets.

Operating costs are GBP3m lower in the period. We have incurred slightly higher maintenance costs of GBP2m which offsets lower cost of sales for shared ownership and open market home sales. Overall, the impact on the operating margin has been a small increase to 25%.

Surplus for the period is GBP24m (2022: GBP25m). The reduction is primarily due to a lower surplus on disposal of housing fixed assets and increased interest costs.

 
 Statement of Comprehensive Income 
                                            6 Months   6 Months   12 Months 
                                              Sep-23     Sep-22      Mar-23 
                                                GBPm       GBPm        GBPm 
 Turnover                                        150        151         300 
 Operating Costs                               (116)      (119)       (240) 
 Surplus on Disposal of Properties                 5          7          16 
 Operating Surplus                                39         39          76 
                                           ---------  --------- 
 Net Interest Payable                           (15)       (14)        (28) 
 Movement in Fair Value of Financial 
  Instruments                                      -          -           6 
                                                                 ---------- 
 Surplus for the period                           24         25          54 
                                           ---------  ---------  ---------- 
 
 Financial Indicators 
                                            6 Months   6 Months   12 Months 
                                              Sep-23     Sep-22      Mar-23 
 Operating Margin on Social Housing 
  Lettings                                       25%        23%         27% 
 Profit Margin on Shared Ownership Sales         16%        15%         16% 
 Profit Margin on Open Market Sales              19%        19%         19% 
 Sales as Percentage of Turnover                 22%        30%         29% 
-----------------------------------------  ---------  ---------  ---------- 
 

Sales of open market (our share only, if part of a joint venture) and shared ownership homes totalled 182 units for the period (2022: 213).

Sales and margins on housing sales continue to perform well despite the challenging market. We are monitoring the impact of increased mortgage rates. As at 30 September 2023, we had 96 shared ownership stock units of which 24 were unreserved (September 2022: 59 stock units,7 unreserved) and 15 open market stock units (our share only, if part of a joint venture) and 7 were unreserved (September 2022: 9 stock units, 4 unreserved).

Housing Properties (net of depreciation) have increased to GBP2,376m from GBP2,318m at March 2023. Net Debt has increased to GBP995m (March 2023: GBP963m).

Customer satisfaction is 85% (September 2022: 85%). Void losses for our general needs stock were 0.73% (September 2022: 0.69%), which remains top quartile performance in the sector compared to HouseMark. Rent arrears were 2.40% (September 2022: 2.28%). The average days to re-let our general needs stock is 42.6 (September 2022: 31.5 days), up slightly from 39 in March 2023. We are taking the opportunity to carry out planned maintenance and energy efficiency works on our homes as they become void.

Liquidity

At 30 September 2023 LiveWest had liquidity of GBP358m, consisting of available undrawn facilities of GBP340m, and available cash of GBP18m.

Development

295 affordable units were handed over in the period (2022: 398). We have a contracted pipeline of 2,294 affordable homes (March 2023: 2,006).

Building Safety

At 30 September 2023 99.82% of homes had an up to date Fire Risk Assessment (March 2023: 100%). 100% of homes had a valid Gas Safety Certificate (March 2023 100%) and 100% of rented homes met the Decent Homes Standard (March 2023: 100%).

Board and Executive Team Changes - 6 months to September 2023

On 1 July 2023, Andrew Sloman became the Executive Director of Finance of the LiveWest Homes group. Mr Sloman has been with LiveWest for 17 years, most recently as Director of Financial Services.

The appointment is part of the transition to the planned retirement in March 2025 of Melvyn Garrett, the former Executive Director of Finance and Deputy Chief Executive. Until that date Mr Garrett will remain as Deputy Chief Executive, with responsibility for People and Communications. He will also retain his seat on the Board of LiveWest Homes Limited and its subsidiary companies.

On the 31 July 2023 Jenefer Greenwood retired from the Board. Following this Christopher Balch (previously an independent advisor) was appointed as Board member on 1 August 2023.

The Group Chair, Linda Nash retired on 10 September 2023 having served her maximum term. She has been replaced as Group Chair by Board member Jaqueline Starr.

There were no changes to the Board of LiveWest Treasury plc.

LiveWest Rating

On 20 October 2023 Moody's changed the rating outlook for the UK from negative to stable. On 25 October 2023 LiveWest, along with 32 other HAs had its rating outlook changed from negative to stable by Moody's. LiveWest Homes Ltd is now rated A2 (stable) by Moody's, and G1/V1 by the Regulator of Social Housing (Dec 2022).

END

For more information, please contact:

   Andrew Hart, Director of Corporate Finance                        01392 814444 

https://www.livewest.co.uk/about-us/for-investors

Disclaimer

The information contained herein (the "Trading Update") has been prepared by LiveWest Homes Limited (the "Parent") and its subsidiaries (the "Group"), including LiveWest Treasury plc (the "Issuer") and is for information purposes only.

The Trading Update should not be construed as an offer or solicitation to buy or sell any securities issued by the Parent, the Issuer or any other member of the Group, or any interest in any such securities, and nothing herein should be construed as a recommendation or advice to invest in any such securities.

Statements in the Trading Update, including those regarding possible or assumed future or other performance of the Group as a whole or any member of it, industry growth or other trend projections may constitute forward-looking statements and as such involve risks and uncertainties that may cause actual results, performance or developments to differ materially from those expressed or implied by such forward-looking statements. Accordingly, no assurance is given that such forward-looking statements will prove to have been correct. They speak only as at the date of the Trading Update and neither the Parent nor any other member of the Group undertakes any obligation to update or revise any forward-looking statements, whether as a result of new information, future developments, occurrence of unanticipated events or otherwise. The information contained in the Trading Update is unaudited.

None of the Parent, any member of the Group or anyone else is under any obligation to update or keep current the information contained in the Trading Update. The information in the Trading Update is subject to verification, does not purport to be comprehensive, is provided as at the date of the Trading Update and is subject to change without notice.

No reliance should be placed on the information or any projections, targets, estimates or forecasts and nothing in the Trading Update is or should be relied on as a promise or representation as to the future. No statement in the Trading Update is intended to be a profit estimate or forecast. No representation or warranty, express or implied, is given by or on behalf of the Parent, any other member of the Group or any of their respective directors, officers, employees, advisers, agents or any other persons as to the accuracy or validity of the information or opinions contained in the Trading Update (and whether any information has been omitted from the Trading Update). The Trading Update does not constitute legal, tax, accounting or investment advice.

Figures quoted in the update are based on unaudited management accounts which are subject to review and further adjustments, for example in the areas of pensions, investment property valuation and taxation.

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November 09, 2023 12:06 ET (17:06 GMT)