Financial performance and statements

The Group generated a surplus for the year of £3.1m (2020: £1.5m) at an operating margin of 46% (2020: 37%).  The improvement in the surplus is due to rent inflation and lower maintenance costs, the latter being influenced by lockdown restrictions during the year. 

The lockdown restrictions also contributed to a slowing of the development programme and consequently a lower level of first tranche sales than anticipated.  Turnover from first tranche and open market property sales was £0.7m (2020: £3.3m) and generated a margin of 22% (2020: 15%).

The balance sheet includes a provision of £3.9m for a constructive obligation to undertake fire safety remedial works on a number of low-rise blocks of flats.  The properties are still in their latent defects period and Hastoe is in the process of seeking remedy from the contractors. The provision reflects the fact that Hastoe may need to incur a proportion of the costs.  The level of EBITDA MRI interest cover of 1.2 times has been suppressed by the £3.9m provision.  Excluding the impact of the provision for fire safety works, and associated impairment, the EBITDA MRI cover was 1.4 times for the year (2020: 1.3 times).

At the year end, the Group had committed debt funding of £268m.  Available liquid resources of £56m (cash holdings of £18m and undrawn loan facilities of £38m) are sufficient to meet the Group’s committed expenditure.  The Group’s drawn debt has limited refinancing risk with less than 15% of the Group’s debt maturing within the next ten years.  The undrawn loan facility of £38m is committed until 2025. At the year end, Hastoe Capital plc held £50m of retained bonds.

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