- Pre-tax profit rises 29% to £44m (2016: £34m), revenues increase to record £191m
- Over 800 homes delivered in 2016/17 and plans to build more than 1,000 in 2017/18
- Will continue to leverage £1.4bn asset base and A+ credit rating to deliver £1.5bn development programme over the next seven years
Housebuilder and landlord Aster Group has announced record profits in its last financial year as it delivers on plans to build thousands of new homes across the south of England.
Pre-tax profit increased by 29% to £44m in the year to the end of March 2017 on revenues up 7% to a record £191m. The group continues to focus on operating effectively to grow profits so it can deliver more and different types of housing. As a not-for-dividend business, Aster uses its profits to maximise the delivery of new homes for the benefit of society.
Aster has boosted its development rate by 15% this year, delivering 829 homes for affordable rent, shared ownership and open market sale. This is over 100 more homes than the business built during 2016 (724 homes).
As part of its plan to invest £1.5bn in its development programme between now and 2024, Aster is increasingly focusing on land-led schemes, alongside homes delivered with other housebuilders. The group completed 83 homes on land-led schemes in 2016/17, including developments in Weymouth, Southampton and Landrake, Cornwall.
Some properties are built as part of its joint venture with FTSE 250 developer Galliford Try and the group is continuing to invest in shared ownership, with 312 homes delivered last year.
Recently, Aster has expanded into Oxfordshire and has plans to develop in other areas close to London. It expects to complete over 1,000 homes during the current financial year, including schemes in Plymouth, Devizes and Walton in Somerset.
Bjorn Howard, group CEO of Aster, said: “We remain focused on operating effectively so we can continue to grow our profit pool. This allows us to build more homes and underpins our ambitious £1.5bn development plan over the next seven years.
“We also look for alternative ways to tackle the housing crisis, like our shared ownership development programme. We believe this product has a key role to play in helping hundreds of thousands of people currently trapped in ‘generation rent’.”
Aster said it would continue to raise finance when needed by leveraging its fixed assets of £1.4bn (2016: £1.3bn) and A+ credit rating, which was affirmed by Standard & Poor’s last December. It also maintained G1 and V1 ratings - the highest available – in February 2017 from the Homes and Communities Agency.
Earlier this year, the group strengthened its delivery capabilities by appointing Galliford Try Partnerships and E G Carter & Co Ltd to a new partnering arrangement worth £150m. It also boosted its development team with a raft of appointments, including the recruitment of development and sales director Jane Gallifent from Clarion Housing Group.
During the year, Aster generated operational savings of £4.3m, including over £432,000 saved by re-procuring services, and reduced mileage claims by 57% with investment in new tech and flexible working.
Bjorn Howard added: “The past few years have been difficult for the sector, but the challenge the government has set the housing associations is clear – run your business responsibly and effectively, and leverage your assets to help tackle the housing crisis. This continues to guide our strategy and our vision of a home for everyone.”
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Notes to editors
Aster Group is working towards its vision of ensuring everyone has a home. Its purpose is to be an ethical housing developer and landlord to benefit society. The not-for-dividend business was established in 1990 and has over £1.4billion worth of assets. Aster plans to develop more than 11,000 homes over the next seven years for open market sale and shared ownership, reinvesting the profits to develop homes for affordable rent. The Group owns and maintains over 29,000 homes and provides services to 75,000 customers. Its corporate social responsibility commitments set out the additional work the business chooses to do. For more information, visit www.aster.co.uk.