Quarterly Performance Update

Clarion Funding plc

29 January 2026

 

Clarion Funding plc

CLARION HOUSING GROUP Q3 2025/26 PERFORMANCE UPDATE

Clarion Housing Group's Quarterly Performance Update covering the period to 31 December 2025

Financial performance

Clarion delivered another strong financial performance in the quarter, reflecting the resilience of its core operations and enabling continued investment in homes, services and communities.

Our unaudited management accounts show that turnover at the period end was £781.2 million (2024/25: £807.2 million), with growth in rental and other income offset by lower development sales. The reduction in sales was driven by the challenging market conditions, alongside our decision to manage supply which has ensured stock levels remain broadly in line with previous years.

Operating surplus increased to £230.0 million (2024/25: £210.1 million) reflecting the additional rental income and a £21.4 million increase in disposal surplus, offset by lower development performance. The underlying development surplus, at £1.5 million, was £8.2 million lower than the previous year, due to both lower volumes and lower margins; £12.0 million of development related impairments have also been recognised in the year to date. This development performance reflects the wider challenges in the housing market. However, the underlying core business continues to perform strongly, with core operating surplus up £14.9 million on a like for like basis.

Net surplus before taxation and fair value adjustments rose to £119.6 million (2024/25: £102.2 million), reflective of the operating surplus increase.

Clarion continued to prioritise investment in both new and existing homes. £417.4 million was invested in new housing supply (2024/25: £349.3 million) and £101.3 million was invested in existing stock (2024/25: £69.7 million). The latter increase reflects earlier phasing along with continued progress on fire and building safety works, as well as energy efficiency and asset investment across the portfolio.  As a result of this investment, the value of housing fixed assets rose to £9.14 billion (2024/25: £8.84 billion).

Drawn debt stood at £4.74 billion (2024/25: £4.59 billion) as at 31 December 2025, with the increase supporting capital investment activity in line with our plan. Our liquidity position remains strong at £0.93 billion (2024/25: £1.26 billion) and the reduction is in part due to our decision to repay an expiring facility early. This level of liquidity provides significant flexibility for the timing of our next fundraising.

During the quarter Clarion's credit ratings were reaffirmed by our three ratings agencies. Moody's affirmed the Group at A3 (Stable), S&P at A- (Stable) and Fitch at A+ (Negative), with the agencies noting the progress in underlying financial performance demonstrated in the year.

Operational performance

Customer satisfaction remained strong in Q3. Overall satisfaction year-on-year rose to 85.4% (2024/25: 83.1%) and repairs satisfaction to 91.0% (2024/25: 89.6%), as we continued to focus on service delivery improvements. Rent arrears improved to 5.86% (2024/25: 6.61%), supported by ongoing engagement with residents and proactive income management. Since the start of the financial year, frontline teams have delivered close to 10,000 money guidance and financial inclusion interventions, helping residents to better manage household finances, sustain tenancies and access appropriate support.

The group has completed 1,000 new homes since the start of the year, with 780 (78%) being affordable tenures (2024/25: 1,246, 83%). Our pipeline now stands at 21,978 homes, up from 20,304 at the same point last year.

Outright market and shared ownership sales were lower at £66.9m (2024/25: £127.8m), which is partly reflective of the decisions noted above to manage supply. Sales margins improved from 0.9% to 2.3% during the quarter (2024/25: 7.6%) although this continues to be low as buyers remained cautious.

Clarion welcomed visits from the Secretary of State for Housing, Communities and Local Government, Steve Reed OBE MP, and the Minister of State for Housing, Matthew Pennycook MP, to Ebbsfleet where Clarion, alongside Ebbsfleet Development Corporation and Vistry, showcased progress on thousands of new homes in the Ashmere neighbourhood and wider Ebbsfleet Garden City.

Sustainability

Clarion continued to strengthen its climate resilience strategy during the quarter. In October, Clarion published its latest Making a Difference report, the Group's annual statement on ESG progress and social impact. Having now delivered a sector leading £1 billion in social value since our merger in 2016, the report highlights Clarion's continued focus on providing homes that are safe, affordable, and fit for the future.

As part of work building on the climate risk mapping completed in 2024, we carried out a series of stakeholder interviews - both internally and with residents - to identify tangible actions to mitigate and adapt to climate change. The work is focused on developing practical interventions across our existing homes, with an emphasis on managing risks associated with overheating and flooding.

Supporting our residents and communities

Clarion Futures continued to play a central role in helping residents to build better futures, delivering a range of support across employment, skills, enterprise and financial capability. In the nine months to December, 967 people were supported into work (2024/25: 1,144), 4,152 (2024/25: 4,083) residents accessed training or skills development, and 66 (2024/25: 47) individuals were helped to set up their own business, reflecting our ongoing commitment to unlocking opportunity and financial independence for residents. Over the same period, £612,641 in grant funding was awarded to community projects and initiatives, enabling further local impact.

In November, Clarion published its landmark Five New Giants of Opportunity report - a bold, forward-looking vision for the future of social housing. Launched at the Royal Institution with a keynote lecture by historian and broadcaster David Olusoga, the report draws inspiration from Beveridge's 1942 blueprint for the welfare state and identifies five modern-day "giants" of opportunity - connection, resilience, trust, health and sufficiency - that must be addressed to ensure residents and communities can thrive in the decades to come. It brings together insights from a multidisciplinary panel and calls on housing associations, government and civil society to work together to deliver a new social contract for housing rooted in wellbeing and long-term impact.

ENDS

For more information, please contact:

Andrew Hill, Director of Treasury and Corporate Finance, Clarion Housing Group - 0203 840 0164 / [e-mail] 

Olly Clitheroe, Communications Manager, Clarion Housing Group - 07858089815 / [e-mail] 

Disclaimer

The information contained herein (the "Trading Update") has been prepared by Clarion Housing Group Limited (the "Parent") and its subsidiaries (the "Group"), including Clarion Funding plc, Affinity Sutton Capital Markets plc, Circle Anglia Social Housing Plc and Circle Anglia Social Housing 2 Plc (the "Issuers") and is for information purposes only.

The Trading Update should not be construed as an offer or solicitation to buy or sell any securities issued by the Parent, the Issuers or any other member of the Group, or any interest in any such securities, and nothing herein should be construed as a recommendation or advice to invest in any such securities.

Statements in the Trading Update, including those regarding possible or assumed future or other performance of the Group as a whole or any member of it, industry growth or other trend projections may constitute forward-looking statements and as such involve risks and uncertainties that may cause actual results, performance or developments to differ materially from those expressed or implied by such forward-looking statements. Accordingly, no assurance is given that such forward-looking statements will prove to have been correct. They speak only as at the date of the Trading Update and neither the Parent nor any other member of the Group undertakes any obligation to update or revise any forward-looking statements, whether as a result of new information, future developments, occurrence of unanticipated events or otherwise.

None of the Parent, any member of the Group or anyone else is under any obligation to update or keep current the information contained in the Trading Update. The information in the Trading Update is subject to verification, does not purport to be comprehensive, is provided as at the date of the Trading Update and is subject to change without notice.

No reliance should be placed on the information or any projections, targets, estimates or forecasts and nothing in the Trading Update is or should be relied on as a promise or representation as to the future. No statement in the Trading Update is intended to be an estimate or forecast. No representation or warranty, express or implied, is given by or on behalf of the Parent, any other member of the Group or any of their respective directors, officers, employees, advisers, agents or any other persons as to the accuracy or validity of the information or opinions contained in the Trading Update (and whether any information has been omitted from the Trading Update). The Trading Update does not constitute legal, tax, accounting or investment advice.

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