You are viewing 1 of your 1 free articles
Goldman Sachs-funded modular housing start-up reports £26m losses across business
TopHat, the modular housing firm underpinned by £75m of funding from US investment banking giant Goldman Sachs, has reported heavy losses across its business in annual accounts filings.
Manufacturing operation TopHat Industries recorded a £21.3m net loss for the year ending 31 October 2020, off a £6.3m turnover. Its operating loss was £17.4m for the period.
Meanwhile TopHat Communities, which handles onsite real estate responsibilities, filed accounts showing a £4.9m loss against a £10.2m turnover, with an operating loss of £3.8m.
The companies had not previously filed annual accounts, but have recorded losses in the past.
Both firms are subsidiaries of parent company TopHat Enterprises, which is run out of Jersey.
Their accounting documents confirmed that TopHat Enterprises would continue to fund its subdivisions for at least a further 12 months.
TopHat Industries is pressing ahead with plans for a second factory amid its pipeline “building strongly”.
READ MORE
TopHat is supplying modular homes to several sites in England, some of which will be managed by social landlords.
In 2019, 55,000-home Home Group acquired 49 such properties at the 302-home Kitchener Barracks site in Chatham, Kent, which TopHat Industries’ accounts reported had been completed on time and to budget.
TopHat is also manufacturing homes for BoKlok, the offsite homes developer part-owned by Swedish furniture giant Ikea, which has struck deals with a number of local authorities.
One such scheme in Bristol has seen one-third of BoKlok homes sold back to the council to add to its own stock.
A strategic report in TopHat Industries’ accounts filing said the company has continued “to invest ahead of revenue, both in growing its capacity and developing its product offering”.
The report, written by chief executive Jordan Rosenhaus, said this involved developing a range of house and flat types – some of which have been used at the Kitchener Barracks scheme – which will “will open a significant new revenue stream” by enabling TopHat to undercut traditional builders.
It added that the firm had also sunk money into research and development around materials and prototyping, as well as its software platform.
“The pipeline is building strongly, giving the board confidence to progress planning for a second factory which will have a capacity of over 3,000 homes,” the document said.
Mr Rosenhaus’ statement acknowledged the impact of Brexit and the coronavirus pandemic on TopHat’s finances, noting that it had accessed several injections of capital from shareholders as well as a loan from Homes England.
But it said the firm’s UK-only focus had mitigated post-Brexit disruption and that difficulties ordering materials had been “managed through forward ordering sufficient stocks and working closely with the supply chain”.
TopHat was founded in 2016 and began production at its Derbyshire plant in 2018, receiving backing from Goldman Sachs the following year.
Sign up for our development and finance newsletter
Already have an account? Click here to manage your newsletters
