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Moat sees surplus more than halve after sharp drop in staircasing
Kent-based landlord Moat has reported a 54% drop in annual surplus after a sharp fall in staircasing on shared ownership homes and higher interest costs.
The 23,000-home group recorded a post-tax surplus of £20.9m in the year to the end of March 2024, compared to £45.9m the year before.
The landlord, which currently has an interim chief executive, reported that surplus on staircasing and loan redemptions slid by 48% to £8.3m. This was blamed on “higher mortgage costs”.
In the year, 103 staircasings were completed, involving a shared owner buying a larger share of their home. This compared to 200 staircasings the year before, Moat revealed in its annual report.
Other landlords have suffered from a slowdown in staircasing amid the tough economic environment, including large East of England provider BPHA.
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Moat also revealed that 39 equity loan holders repaid their loans, against 76 in the previous 12 months.
However the group’s income from shared ownership first tranche sales held up better, slipping to £15.1m compared to £17.3m in the 2022-23 financial year.
Turnover from open market sales fell to £2m, down from £18m the previous year, as all completed homes of this tenure were sold, the landlord said. No market sales are planned until 2026, the group said.
Moat also reported that its interest and finance costs from bank loans, overdrafts and “other loans” rose to £29.3m, against £24.9m the previous year.
Operating costs jumped by around a quarter to £102.7m.
Like many of its peers, Moat reported a rise in spending on existing homes amid the heightened focus on housing conditions and net zero efforts.
The landlord spent £51m on its current stock, up from £31m the previous year.
Income from social housing lettings rose to £134.4m, but the group’s surplus from social housing lettings fell to £37m, compared to £42m the previous period.
Moat – which operates homes across Kent, Sussex, Essex and London – said this was “largely due to higher spending on repairs driven by increased volume and costs, as well as investment in skills and capacity”.
On completions, the landlord handed over 354 homes, which was 23% less than in 2022-23. However in the current year, Moat said it was “on target” to complete 505 homes.
Of the 354 total last year, 239 were rented tenures and the rest shared ownership.
Overall turnover fell by 3% to £154.4m.
Writing in the group’s annual report, Steve White, chair of Moat, branded it a “fast-paced and demanding year for us all”.
He added: “We continue to experience high inflation, higher interest costs and increasing demand for repairs and welfare support.”
Looking ahead, he said the group awaited “long-term housing commitments and policies” from the new government.
Steve Nunn is currently holding the reins at Moat as acting chief executive following the sudden exit of Mary Gibbons in February.
Gavin Cansfield, current chief executive of Settle, is due to take the top job at Moat after being appointed in June.
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