Trading update for six months to 30 September 2026

Paragon Treasury PLC

26 October 2026

 

Paragon Treasury Plc

Paragon Asra Housing Limited ('PA') trading update and unaudited financial results for the period ended 30 September 2026

PA, the parent company of Paragon Treasury Plc and a Registered Provider owning and managing 25,000 homes in the East Midlands, London and Surrey, announces its trading highlights and unaudited summary financial results for the first half of the 2026/27 financial year.

Results for the year to date are in line with approved budget in most areas. Planned maintenance investment into our homes has largely kept pace with the budget put in place at the start of the year. Sales performance has remained strong and profits generated are in line with budget at the halfway point. Salary and overhead costs are below budget.

There have been some adverse movements against budget in certain areas:

Rent and service charge income is behind budget, due to a combination of new development handover delays and longer than target average letting times.

There has been modest upward pressure on decant costs, with year to date volumes higher than assumed in the budget.

Service costs are above budget, primarily due to increased third party managing agent fees and continued higher activity on estates bulk rubbish management.

Interest costs are above budget, reflecting the higher interest rate environment compared to assumptions made when the budget was set. The drawn debt position is below budget.

Financial and operational highlights

·    The year to date operating margin from social housing lettings is 23% including fire safety remediation project expenditure, 24% excluding.

·    27 new build shared ownership homes have been sold, generating proceeds of £6.5m and surplus of £2.0m at a margin of 30%.

·    £16.0m has been invested into our capital maintenance programmes in the first six months of the year, and a further £9.3m of capital expenditure has been incurred against our fire safety remediation projects.

·    Rent collection has remained solid, with gross rent arrears standing at 3.3% at the end of the period.

·    Salary and overhead costs are underspent by £3.3m in the year to date.

Areas of focus

·    As noted above, we are working to improve turnaround times for vacant homes so as to reduce void loss.

·    We continue to progress our fire safety remediation projects and are in the process of securing further cost recoveries from contractors. We have also achieved £6.9m of grant income against this workstream in the year to date.

·    We are forecasting a modest drop off in new property sales activity in the remainder of the year, compared to budget. This is only expected to have a marginal impact on outturn results.

·    The cyclical maintenance programme is behind budget for the year to date and we are working to accelerate spend in the second half of the year.

·    Our energy contracts have recently been reprocured, at less favourable rates due to the more volatile market conditions. This will feed through into our service charge calculations.

Outlook

The UK economy remains sensitive to government policy developments and broader geopolitical uncertainty. Future events could cause shocks to the core forecast, noting in particular risks relating to potential severe winter weather conditions and government warnings on possible disruption to key infrastructure.

Against this backdrop, we continue to maintain a cautious financial planning posture which retains appropriate capacity and resilience while working to maximise our investment in homes and services. Our ongoing work to continue driving up service standards and improve the quality of our homes and estates is having a positive impact on resident satisfaction levels, as measured through our Tenant Satisfaction Measures survey results.

Statement of Comprehensive Income to 30 September 2026

	Actual £m	Budget £m	Variance £m
Rent and service charges income	103.3	106.6	(3.3)
Shared ownership first tranche sales	6.5	6.5	-
Other income	2.1	1.9	0.2
Amortisation of SHG and Goodwill	3.3	3.3	-
Turnover	115.2	118.3	(3.1)
Core operating costs	(69.2)	(75.7)	6.5
Depreciation	(13.4)	(14.8)	1.4
Cost of first tranche sales	(4.5)	(4.4)	(0.1)
Surplus on fixed asset disposals	5.3	5.5	(0.2)
Operating surplus	33.4	28.9	4.5
Net interest	(26.4)	(25.7)	(0.7)
Total comprehensive income before tax, fair value adjustments	7.0	3.2	3.8

Statement of Financial Position as at 30 September 2026

	30 Sep 26 £m	31 Mar 26 £m
Negative goodwill	(3)	(4)
Tangible fixed assets and investments	2,443	2,419
Current assets	78	96
Current liabilities	(94)	(109)
Total assets less current liabilities	2,424	2,402
Creditors due after more than one year	(1,785)	(1,767)
Pension liabilities and other provisions	(8)	(11)
Total net assets	631	624
Reserves	631	624

Enquiries

All enquiries in relation to this trading update should be directed to:

Simon Hatchman, Executive Director - Resources

Tel: [phone]

email: [e-mail]

Disclaimer

The information in this preliminary announcement of interim results has been prepared by Paragon Asra Housing Limited and is for information purposes only. The announcement should not be construed as an offer or solicitation to buy or sell any securities issued by Paragon Treasury Plc or any other member of the Group, or any interest in such securities, and nothing herein should be construed as a recommendation or advice to invest in any such securities.

This unaudited announcement contains certain forward looking statements reflecting, among other things, our current views on markets, activities and prospects. By their nature, forward looking statements involve a number of risks, uncertainties or assumptions that could cause actual results to differ materially from those expressed or implied by those statements. Actual and audited outcomes may differ materially. Such statements are a correct reflection of our views only on the publication date and no representation or warranty is given in relation to them, including as to their completeness or accuracy or the basis on which they were prepared. Financial results quoted are unaudited. We do not undertake to update or revise such public statements as our expectations change in response to events. Accordingly, undue reliance should not be placed on forward looking statements.

 

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