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Clarion Funding plc (96XN)

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Tuesday 28 July, 2020

Clarion Funding plc

Quarterly performance update

RNS Number : 3686U
Clarion Funding plc
28 July 2020

Clarion Funding plc


Clarion Housing Group's quarterly performance update covering the period to 30 June 2020 .

Financial performance

The unaudited management accounts for the first quarter of financial year 2020/21 show an operating surplus of £72 million (2019: £73 million). This is a resilient performance in the context of the significant disruption caused by Covid-19.

Total capital investment in new homes during the first quarter was £98 million (2019: £126 million) and in existing homes was £5 million (2019: £12 million) - both have been impacted by work that was put on hold due to Covid-19 but are now expected to pick up as restrictions ease.

Housing fixed assets stood at £7.45 billion, up from £7.44 billion as at 31 March 2020. Drawn debt as at 31 March 2020 was £4.09 billion, up from £4.04 billion as at 31 March 2020. Liquidity stood at £1.13 billion (31 March 2020: £0.90 billion) and committed and immediately available loan facilities were £5.12 billion (31 March 2020: £4.83 billion).

Operational performance

From the beginning of July a near full repairs and maintenance service has been restored, moving from emergency and urgent only repairs. Occupancy rates have remained good at 98.1% (target 98%) despite the lockdown restrictions, with housing teams continuing to make home visits in a safe way and introducing alternative processes to be able to undertake many tasks remotely. Working closely with key partners, Clarion rehoused 230 homeless households during the period. Due to the exceptional circumstances of lockdown, customer satisfaction surveys were paused temporarily and a score is not available at this time.

Arrears stood at 6.1%, up from 5.2% at year end. An increase was expected as a result of employment and income changes faced by residents associated with the Covid-19 crisis and the related restrictions. The Group continues to monitor the situation closely and provide support for residents, signposting them to the financial support available and offering guidance on how to manage payments.

Construction was paused at the start of the lockdown however gradually development activity has resumed in line with guidance. Sales offices and construction sites were reopened in early June. Since 1 April 2020, 265 new homes have been completed, of which 95% were for affordable tenures, and 40 new homes have started, 100% of which are for affordable tenures. The Group's development pipeline remains at circa 17,000 new homes.

Completions of outright sales and shared ownership have been able to resume during the quarter and have generated an income of £30 million (2019: £23 million) with a margin of 7.6% (2019: 18.2%). The sales performance reflects annual growth in programme size compared to last year and a number of sales carried over from the previous quarter. The lower margin at this point in the year reflects forward funded marketing costs for future launches and the margin is expected to increase as the year progresses. The easing of lockdown restrictions has brought a degree of pent up demand and improved market sentiment, boosted by the stamp duty holiday, and sales enquiries have reverted to pre-lockdown levels.


The Group is pleased with the strong response to the consultation on standardising ESG reporting in the sector. Ten themes and 45 criteria were proposed as part of a draft white paper developed by a working group of housing associations (including Clarion), investors, service providers and organisations concerned with growing the impact investment marketplace. The deadline for submissions (submit here ) is 31st July 2020.


When the Covid-19 outbreak struck towards the end of March 2020, we acted quickly to provide support to residents and longstanding partners in our communities affected by the pandemic. Through our Emergency Support Fund we have issued more than 90 grants totalling more than £113,000 to organisations across the country, including food banks, community groups and local charities.

In addition, 117,000 calls have been made to vulnerable residents and near full service has resumed across the business, following government guidance closely with the safety and wellbeing of staff and residents remaining of paramount importance.

The Group continues to be prepared for a range of downside scenarios and remains well-placed to manage this unprecedented event.




For more information, please contact:

Gareth Francis, director of treasury and corporate finance, Clarion Housing Group - 0778 7555655 /  [email protected]

Lucy Pond, communications manager, Clarion Housing Group - 0771 8269023 /  [email protected]




The information contained herein (the "Trading Update") has been prepared by Clarion Housing Group Limited (the "Parent") and its subsidiaries (the "Group"), including 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 a pro t 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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