The housing association’s pre-tax profit falls 14% due to a combination of an increase in costs caused by inflation and an ‘all-time high’ investment in its homes
Aster Group reported a ‘strong year’ achieving a turnover of £314m, up from £301m in the previous year, however, its pre-tax and operating surplus both dropped.
The 37,000-home housing association, in its financial statements for the year to 31 March, said its pre-tax surplus dropped by more than 25%, from £55.3m in 2022/23, to £41.1m at 31 March 2024.
The pre-tax surplus in the previous year was inflated by a one-off £12.8m gain following the group’s acquisition of disability charity Enham Trust.
The figure was also hit however by an increase in interest costs of almost £6m, £1.1m in joint venture losses and £3.1m in impairment costs for homes under construction.
Aster’s operating surplus , which excludes one-off interest costs, also fell, from £81m to £73m and was “slightly behind budget”.
The Hampshire-based housing association also invested £106.2m in repairs and maintenance during the year. This expenditure covered planned works, bringing vacant properties up to standard, and maintaining estates.
>> See also: Aster misses development target as capacity ‘plateaus’
>> See also: Aster appoints first ever ‘transformation director’ as it seeks to modernise services
In the financial statement, Aster group’s chair, Stephen Trusler, said that spending on maintenance and repairs increased during the winter, as the board “made the conscious decision to increase investment in our stock in the second half of the year because it was the right thing to do.”
Aster’s social housing lettings income increased from £226m to £253m, this was partially offset by a fall in shared ownership first tranche income from £60m to £48m.
As previously announced, Aster missed its development target by 16%, delivering 997 new homes in 2023/24.
In November, Aster said it was on track to hit its target of 1,160 completions in the year.
Aster said it has secured a mixture of both land and developer-led opportunities, adding to its contracted pipeline of 3,174 homes.
By the end of 2026, Aster says it will be in a position to invest close to £600m in new homes.
Bjorn Howard, chief executive at Aster Group, said: “It’s been an incredibly challenging year for the social housing sector. Despite a real-term decrease in rental income due to inflation, a robust balance sheet has meant that this year we spent a record amount on our repairs and maintenance.”
Howard added that Aster has also made a “significant investment” in its customer services modernisation programme, which shapes how it delivers the best possible homes, services and experiences for customers.
He continued: “The need for new affordable homes is only going to increase, with the cost-of-living still high and a new government that has put housebuilding at the forefront of its strategy for economic growth. A strong balance sheet means we are well-placed to deliver the affordable homes needed across our regions.”
“We’ve set out an ambitious programme centred around our commitment to invest in our customers’ homes and our service offer and achieving record numbers of homes. The scale of the challenge for the housing sector ahead is significant but we look forward to rising to it.”
Housing association financial statements 2023/24
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