The financial state of the sector FY17/18 is presented by Vantage and the Performance Improvement Club for the second year running. The report was produced in response to a demand for a more timely and insightful analysis of the sectors financial performance and of the Global Accounts data. Since introducing our online financial comparison tool, Global Accounts Plus in 2015, it has become the essential online tool for progressive housing providers. Building on last year’s report, the data and narrative allows executive teams to analyse many financial metrics, including the new RSH metrics, in a meaningful way. Find out more about the Performance Improvement Club and Global Account Plus here.
Access the definitive financial results for the social housing sector FY17/18. Read the full report here
Vantage Chief Executive, Tony Bryan, explained that “We believe this report to be ground-breaking: interrogating the figures sooner, helping our clients to understand their relative performance, plan ahead and use the 2017/18 data to inform their planning for the second part of the current financial year.”
Headline takeaways from the report include:
- Increasing margins: in the second of a four-year rent reduction, the sector has largely maintained last year’s improved financial position. Total turnover has increased by just over £1bn, operating margins dropped by 1% and the total operating margin increased by 2.3%.
- Increased employment costs: the year saw a sharp rise in staff costs, up by 11.6% and less significant rise in the total number of staff, up by 4.2%. The number of additional employees does not correlate to the total salary increase, possibly indicating that the increase is because of restructuring costs.
- Room for improvement: overall spend on repairs and maintenance has increased by 5.7%. Notwithstanding the costs of restructuring, there is little sign of economies being achieved in any of the major cost areas; if repairs demand was managed more effectively this could yield multi-million-pound savings per annum.
Vantage have collated the consolidated group financial statements of 125 largest Registered Housing Providers (RPs) for the year ended 31st March 2018. This represents 85% of the total turnover of the sector from the RSH Global Accounts data.
The 125-sample size represents just over £17 billion total turnover across the sector and covers a range of key areas including turnover, void losses, operating margins, lettings, operating costs and a new section on RSH metrics as yet unseen. Headline numbers from the report show:
- £17.06 billion total turnover
- Employment Costs rose to £3.59 billion, up 11.6% on last year,
- Number of Staff members rose by 4.2% to 98,885
- Average debt throughout the period was £63.5 billion, up 11.5% on 2016/17
- Headline Social Housing Cost per Unit for 2016/17 was £3,674
Tony Bryan continued: “financial viability remains strong in the sector. However, I am certain there are still further significant efficiencies to be achieved, especially in development, R&M and across all operating costs.”
Download the full report here.
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