LOVELL REPORTS 53% RISE IN REVENUE IN HALF YEAR RESULTS

Partnership housing specialist Lovell has made an important contribution to results for the half year, released today by parent company Morgan Sindall Group plc, the construction and regeneration group.

CGI of Royal Victoria Court, Newport

Morgan Sindall Group has delivered a record set of results for the first half of 2021, with trading substantially ahead of ‘pre-pandemic’ 2019 levels. Compared to 2019, revenue was up 10% to £1,559m (HY 2019: £1,421m) with adjusted operating profit of £54.8m (HY 2019: £37.5m), up 46%. The Group’s balance sheet has also further strengthened, with net cash of £337m and average daily net cash for the half of £294m. With three profit upgrades in the first half of the year and a high quality order book with a secured workload of £8.3bn, level with year-end, the Group is well-positioned for continued future growth.

Lovell has seen high levels of market demand across the first half, with revenue up 53% to £270m (HY 2020: £176m).  Revenue was 14% higher than in the comparative period in 2019 (HY 2019: £238m). Operating profit of £12.1m was up 476% on the prior year (HY 2020: £2.1m) and up 89% on the comparative period in 2019 (HY 2019: £6.4m), driven by the higher mixed-tenure revenue and operational improvements.  The operating margin increased to 4.5% (HY 2020: 1.2%).

Lovell regional managing director, James Duffett: “Our half year results reflect the continued hard work and commitment of the entire Lovell team in the delivery of partnership homes.  With the addition of several more strategic partnerships we have increased our orderbook and created a great platform for further growth.

“That’s not to say there aren’t challenges in the market right now. It’s widely publicised that the impact of material shortages is ongoing and in response we are working proactively with our supply chain to forward plan.  Our number one priority remains, to support our partners in the delivery of much needed, high quality, affordable homes.

“As we look to the future, we continue to make good progress in reducing our carbon footprint.  By working collaboratively with our colleagues in the Group, our valued partners and suppliers, we can make change happen – achieving net zero carbon will only happen if we work as one.”

Foxglove Meadows, Weston-super-Mare

Lovell is currently working on a number of key projects including:

1.            The Mill, Cardiff – open market sales have now completed at Wales’ largest regeneration project – a year ahead of programme. The third phase of the affordable homes programme is well underway, which will see the next 105 affordable homes delivered for rent through Tirion Homes and Cadwyn. The project will continue through to summer 2024 when the final affordable homes will be completed.

2.            Ymyl Yr Afon, in Merthyr Vale – works are nearing completion on this £25m mixed tenure development consisting of 153 homes. The development, which includes a mix of 110 open market homes and 43 affordable homes, is being delivered in partnership with Merthyr Tydfil Housing Association. This development has seen strong sales success and the final affordable homes are set to be handed over this month (August 2021).

3.            Golwg Y Bryn, Ebbw Vale  – This £16.8m mixed tenure development is delivering 70 open market homes and 30 affordable homes for rent and shared ownership in partnership with Melin Homes. The final open market sales will complete, and affordable homes be handed over in September 2021.

4.            Keepers Gate, Weston-super-Mare – works are close to completion on a development delivering 50 new homes. The £15m development includes a mix of 35 open market homes and 15 affordable homes in partnership with LiveWest, with the final affordable homes handed over in June 2021 and the final open market sales due to complete this month (August 2021).

5.            Foxglove Meadows, Weston-super-Mare – work is well underway on a £32m development adjacent to Woodside Avenue, which will deliver 81 open market homes and 49 affordable homes for rent and shared ownership in partnership with Abri. The development has seen a successful start following a sales launch earlier this year, and all the two and three-bedroom open market homes for 2021 have already sold.

6.            Royal Victoria Court, Newport – works have commenced on another of Wales’ largest regeneration schemes – a £85m development to construct 528 new homes. The mixed tenure development is in partnership with Tirion Homes and Welsh Government, bringing a mix of open market homes and affordable homes for rent and shared ownership. Work commenced in May 2021 and completion of the development is expected in March 2025.

7.            Drummond Park, Wiltshire – work on a £110m Former Defence Medical Equipment Depot (DMED) site is expected to commence early autumn 2021. The development will deliver 412 homes, including 309 for open market sale and 103 affordable homes.

8.            Chartist Garden Village, Pontllanfraith – a pre-construction contract has been awarded for design and build project for Pobl, which will deliver 123 homes with work expected to commence in autumn 2021.