RNS Number : 4044L
Inland Homes PLC
30 April 2020


30 April 2020

Inland Homes plc


Trading Update


Inland Homes ("Inland Homes" "the Group" or "the Company"), a leading brownfield developer, housebuilder and partnership housing company with a focus on the south and south east of England, today provides a further trading update  on the evolving COVID-19 pandemic and the further actions taken by the Company in response to this unparalleled event. The Company's interim results for the 6 months ended 31 March 2020 are expected to be released towards the end of June 2020.  


As referred to previously, the Covid-19 pandemic has impacted the Group's interim results, with five significant transactions, three of which were to major listed housebuilders, being aborted in March 2020.  The total sales value of these transactions was £46.2m. Had these transactions completed as expected, the Company would have achieved the significant reduction of debt planned by management for the first 6 months of the year.


Trading update and financial guidance


The Group achieved legal completions of 136 homes (including joint ventures) during the six months to 31 March 2020 at an average selling price of £284,000.  The average sales rate was 0.71 unit per active outlet during this period. Although all our sales centres have now been shut, we are continuing with our sales and marketing activity remotely.


At 31 March 2020 the Group had forward sales of £30.0m including the sale of a hotel in Bournemouth to Aviva for £13.3m as well as a Partnership Housing order book of £72.7m.


There is little evidence that the UK's national quoted house builders are in the market to purchase land at the present time, however we continue to receive approaches from smaller and medium sized housebuilders for the purchase of sites with planning consent.  We are also being approached by housing associations and build to rent funds for bulk purchases of apartments under construction. Solicitors have been instructed on the forward sale of 113 apartments for a gross value of £22.5m.


We have four Partnership Housing sites under construction for Registered Providers and work is progressing albeit with reduced manpower, which currently generate approximately £6.0m of cashflow per month.


Our land bank now stands at a record 9,143 plots of which 2,881 have planning consent.  Our growing strategic land portfolio where most of the plots are controlled by discount to market value options has increased and now comprises 3,658 plots.  We continue to achieve a good success rate in getting sites allocated for development in local plans.


At 31 March 2020, the Group had cash balances of £17.8m and as a result of the abortive land disposals our net debt was £150.3m.  We had undrawn facilities of £7.4m within our facilities as well as an accordion facility of £20.0m with HSBC.  Discussions are ongoing in relation to renewing the revolving credit facility of £17.2m secured on a portfolio of sites with professional valuations of £26.5m, expiring on 22 August 2020, and the lender has indicated that investors in the facility are positive about renewing. In addition, Inland has a land facility of £4.0m expiring on 12 August 2020 where the lender has agreed in principle that they will extend the facility for a further six months.  The Group expects to repay this facility before its expiry from the sale of the related plot of land.


In line with the Group's commitment to health and safety, Inland's priority continues to be the health and safety of all our employees, sub-contractors and customers.  Three of our sites have been closed and work is continuing at seven sites where processes in line with Public Health England guidance on social distancing can be achieved and where early cash generation may be achieved. In addition, the business has carried out a range of additional measures, including protocols over hygiene, social distancing, travel and self-isolation  and our health and safety personnel continue to monitor the position.


As reported on 30 March 2020 the Board acted quickly in response to the COVID-19 pandemic taking a number of immediate measures to reduce the Group's cost base and to conserve cash. These measures include:


•     The Executive Directors and the Operational Board taking a voluntary salary cut of 50% per annum for the foreseeable future. In addition, the Executive Directors have deferred taking their annual bonus for the 15 month period ended 30 September 2019;

•     The Non-Executive directors have taken a temporary voluntary reduction in their fees of 25% per annum;

•     All staff working remotely earning more than £40,000 per annum have taken a voluntary salary reduction ranging from 9% to 40% per annum;

•     Over 70 members of staff have been furloughed under the Coronavirus Job Retention Scheme;

•     Temporary closure of some sites;

•     Discretionary overhead expenditure reduced to minimum levels;

•     No capital expenditure unless absolutely necessary; and

•     Cancelling the second interim dividend of 2.25p per share which was due to be paid on 12 June 2020, providing a cash saving of £4.6million.


The impact and extent of COVID-19 is clearly uncertain at this stage as are its ramifications on our financial results for the year ending 30 September 2020.  We are assuming that all planned sales of our homes are delayed by at least two months and that the majority of our land sales will be delayed by between two and six months. This includes the major land sales that were expected to be achieved for the half year ended 31 March 2020.  These delays will result in revenues, gross and operating profit in the period being impacted significantly. The Partnership Housing revenues are expected to continue in line with our expectations as work on these sites are continuing at present.




Stephen Wicks, Group Chief Executive, commented:


"The Group has taken a number of measures in these unprecedented times to conserve cash and protect the underlying value of the Group's assets."


"I should like to take this opportunity to thank all our members of staff in working with us to manage the business through these difficult times."   








Inland Homes plc:

Tel: 44 (0) 1494 762450

Stephen Wicks, Chief Executive

Nishith Malde, Finance Director

Gary Skinner, Managing Director

Panmure Gordon (UK) Limited

Tel: 44 (0) 20 7886 2500

Dominic Morley

Erik Anderson

Instinctif Partners

Tel: 44 (0) 20 7 457 2020

Mark Garraway

James Gray


This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation EU 596/2014.


Notes to Editors:

Incorporated in the UK in 2005, Inland Homes plc is an AIM listed specialist housebuilder and brownfield developer, dedicated to achieving excellence in sustainability and design.


Inland Homes acquires brownfield land in the South and South-East of England principally for residentially led development schemes. The business then enhances the land value by obtaining planning permission, before building open market and affordable homes or selling surplus consented land to other developers to generate cash.


The Company is committed to extensive public and community consultation in order to ensure that, where possible, local community needs and objectives are met.


Inland's aim is to create sustainable communities and homes which set a benchmark for all future developments in the South and South East of England. The Company is always looking for brownfield sites without planning permission for future development.


For further information, please visit the Inland Homes website at www.inlandhomes.co.uk.

Hugg Homes - www.hugghomes.co.uk

Rosewood Housing - www.rosewoodhousing.co.uk


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