Impairment costs see Hyde’s surplus fall by 78% as starts plummet

The landlord also saw a reduction in development and joint venture surplus, with outright and first tranche sales dropping year on year, falling 41.7% to £42.4m.

Joint venture income more than halved, falling to £22.3m, which led to a decrease in the share of surplus from this part of the business dropping by £3.9m to £1.2m.

Housing property sales rose, however, resulting in a surplus of £46m, versus £38.9m the previous year.

Starts were down by three-fifths year on year in 2023-24 at 823, compared to 2,105 in the previous year.

Although Hyde completed 630 homes in 2023-24, a slight uptick on last year’s total of 625, this was far below its target of 1,105 homes.

“This is lower than target, as we proactively managed our development pipeline to reduce our exposure to build and sales risk,” Hyde said.

In 2022-23, Hyde also missed its delivery target of 814 homes, but by a smaller margin of 189.

The housing association has a goal of completing 4,760 homes between 2024 and 2028, around three-quarters of which will be affordable.

Hyde recently announced that it was looking to renew its main contractor framework as it aims to build about 1,500 homes a year over the next five years.

Before operating cost adjustments, Hyde also noted an adjusted operating surplus of £117m, down from £119.7m in 2022-23 due to one-off transactions and fair value adjustments, and a margin of 33.4%, which represented a slight improvement year on year.

It said this “was enabled by firm cost control measures and enhanced by surpluses from property sales”.

Its core operating margin increased to 21.1% from 20.2%, while its core operating surplus rose 12.5% to £64.6m.

Hyde spent £109.2m on repairs and maintenance in 2023-24, up nearly £15m on 2022-23.

Andy Hulme, chief executive of Hyde, said: “Customers are now at the heart of a coherent and consistent service. As well as continuing to invest in their homes, we’ve grown our customer-facing teams, reconnected with communities and expanded digital platforms to make it easier for customers to get in touch, and to make it easier for us to resolve their queries faster.”

Rod Holdsworth, chief financial and resources officer at Hyde, said: “Our financial discipline and efficiency programme have enabled us to increase investment, despite the financial challenges impacting the whole sector.”

Earlier this month, the G15 landlord kicked off talks to take on Tower Hamlets Community Housing, which is currently non-compliant with the regulator’s standards.