Housing association says surplus nearly halved to less than £100m in latest set of accounts

Clarion’s surplus fell by nearly half last year as the firm counted the cost of contractor failures and a crippling cyber attack which hit it for £17m.

The 135,000-home housing association, in its financial statement for the year to 31 March, said its surplus fell 48% to below £100m.

One-off items included the cost of dealing with firms going under including offsite contractor Mid Group’s failure last summer, which led to work on a 17-storey tower block for Clarion in Bristol being stopped.


A cyber attack last year cost Clarion £17m, the firm said in its latest accounts

And Manchester contractor Beaumont Morgan which was building a 271-home block for the association in Salford also went into administration last year.

The group said last summer’s cyber attack cost it £5m to deal with initially and a further £12m in bad debt provisions as it impacted Clarion’s ability to collect rent.

Clarion reported an overall surplus of £96.8m, down from the £185.8m reported the previous year, with the number also hit by £45m of breakage costs related to refinancing.

It said that its annual turnover during the period dropped 5% as its development sales revenue plummeted with income falling to £1.01bn from £1.06bn last time.

Group sales income fell from £307m to £220m, with open market sales income falling from £157m to £99m and shared ownership income dropping from £150m to £121m. The fall was partially offset by a £28m increase in revenue from social housing lettings.

Clarion said the reduction in sales turnover reflected lower completions as it “took a more cautious approach to development in the current climate”. It completed 2,032 homes in the year, 11% fewer than the previous year’s total of 2,276.

The firm has quietly scaled back its long-term development ambitions after saying in its 2018/19 financial statements that it wanted to build 5,000 homes a year.

A year later this had dropped to 4,000 and in its most recent accounts, for 2021-22, the aim had changed again, with Clarion pledging to “consistently build 3,200 homes a year”.