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Clarion Funding plc (96XN)

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Friday 23 October, 2020

Clarion Funding plc

Quarterly performance update

RNS Number : 1126D
Clarion Funding plc
23 October 2020

Clarion Funding plc


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

Financial performance

The unaudited management accounts for the first half of financial year 2020/21 show an operating surplus of £139 million (2019: £138 million) demonstrating the Group continues to deliver a solid financial performance against the backdrop of the Covid-19 pandemic.

Total capital investment in new homes was £274 million (2019: £284 million) and in existing homes was £29 million (2019: £31 million).

Housing fixed assets stood at £7.52 billion, up from £7.44 billion as at 31 March 2020. Drawn debt as at 30 September 2020 was £4.16 billion, up from £4.04 billion as at 31 March 2020. Liquidity stood at £1.16 billion (31 March 2020: £0.90 billion) and committed and immediately available loan facilities were £5.19 billion (31 March 2020: £4.83 billion).

Operational performance

The Group is pleased to report that despite the challenging operating environment, its latest customer satisfaction score is above the 80% target at 83.3%. Having restored a near full repairs and maintenance service from the beginning of July, we have now returned to our standard repairs service, providing emergency repairs within 24 hours, and any other repairs on the next available appointment, with a target to complete the repair in 28 days. Customer satisfaction with repairs was last measured at 89.3%, above our 85% target.

Occupancy rates remain good at 98.2%, only marginally under our target of 98.3%, and arrears remains within our Covid-19 adjusted tolerance at 6%, reduced from the previous quarter when it stood at 6.1%. Our team of welfare benefits advisers has been providing guidance and advice on the support available to residents who are facing financial difficulties.

We have worked with our contractors to maintain high levels of delivery in the first half of the year with 860 new homes completed, compared to 691 homes for the same period last year. 91% of these completions have been affordable tenures. An expected decrease in starts has been seen compared to last year, at 813 (2019: 1,132) but still represents a strong performance given the pause in construction activity towards the end of March 2020. The Group's pipeline currently stands at around 18,000 homes.

Completion of outright sales and shared ownership have generated an income of £70 million in the year to date (2019: £43 million) with a margin of 9% (2019: 18%). As expected, the sales margin has improved since the last quarter (7.6%) but does continue to reflect forward funded marketing costs for future launches.

Land and development

During the quarter we agreed a number of significant deals and partnerships including the purchase of a major new residential site to the west of Leeds city centre where the ambition is to create a thriving community alongside retail units, space for creative industries and leisure facilities and to provide employment opportunities for local people. A strategic partnership with Hadley has also been announced which will see the delivery of mixed-use developments across London and in other major urban centres.

Supporting people during   Covid-19

We continue to make nearly 6,000 welfare calls each week to our older residents or those who are vulnerable and still want our assistance, to check they have the support they need. In addition, the Emergency Support Fund established by our charitable foundation, Clarion Futures, has awarded funding to 101 organisations and has helped over 4,000 households in the communities where we have a presence with emergency food.

Clarion Futures has continued to deliver its vital social investment programmes and has surpassed its targets across a range of measures since the start of April, supporting 978 people into work, securing training for 1,772 and helping 80 people to set up their own business. In addition, 9,603 money guidance and financial inclusion interventions have been made.

Alleviating homelessness

In July we announced a new three-year partnership with homelessness charity, St Mungo's. The partnership aims to not only raise funds for St Mungo's, but also leverage shared expertise and resources to tackle the causes of homelessness and support people in their recovery.

The partnership has been kick-started by a £20,000 corporate donation from Clarion to enable St Mungo's to purchase digital devices for service users, ensuring people can continue to access vital services and stay connected during the ongoing coronavirus outbreak.

ESG Report

In the coming weeks, Clarion will publish its first ESG Report which will bring together key metrics to aide investors' assessments and fulfil the requirements of our Sustainable Housing Finance Framework and the pan-European Certified Sustainable Housing Label, for which we are currently also undergoing an annual review for re-certification.

The new Sustainability Reporting Standard for Social Housing developed by a working group of housing associations and investors, and of which Clarion is a founding member, will be published in early November. Clarion's ESG report will cover the criteria prescribed by the Standard.



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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