Sales margin falls from 8.2% to 5.4% due to “market conditions”
Clarion has increased its development by 30% in the first half of the financial year.
The 125,000-home association, in an unaudited trading update, said it has built 792 homes in the year to date, up from 606 the previous year.
The figure means Clarion had built 43% of its homes towards its 2024/25 target of 1,828 at the half-way stage.
It said: “The future pipeline stands at some 20,532 homes, which we will deliver at a pace which enables us to maintain a strong and resilient financial profile.”
Clarion increased its turnover for the half year by 11.5% from £541.8m to £485.8m, while its pre-tax surplus doubled from £30.4m to £65.1m. The group’s surplus was driven by higher rental income, and increased surplus on disposals in addition to a £2.2m increase in investment property valuations.
The group’s investment in existing homes fell from £66.1m to £41.1m, however it said this was due to timing differences in the phasing of work and it expects increased spend in the second half of the year. It spent £204m on new homes in the six months, down from £233.8m last year which Clarion said is due to some later starts on site.
>>See also: Exclusive: Clarion announces ‘ambitious’ restructure to improve housing management
Clarion generated £88.1m in income from outright market and shared ownership sales, which was up on the £67.2m figure for last year. However, its sales margin fell from 8.2% to 5.4%
It said: “Market conditions and supply chain costs have continued to have an impact on the sales margin although more recently, development costs have begun to stabilise.”
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