Firm set to release loss-making numbers at end of next month
A deteriorating housing market and ballooning construction costs has seen troubled Inland Homes revise the amount of pre-tax loss it expects to post last year from £37m to more than £90m.
Earlier this month, the housebuilder and land trader was forced to announce that its new chief executive had quit after just 41 days in the role. Former Galliard Homes chief executive Don O’Sullivan had only been in post since 7 December,
Now in a trading update this morning, Inland said it expects to make a pre-tax loss of £91m when it publishes its results for the year to September 2022 at the end of next month. This is more than two times the £37m it said it would lose in a trading update at the beginning of last September.
It said constriction costs on five contracts being carried out by its partnership housing business had nearly doubled following a review – from £15.4m to £28.8m.
“Unforeseen costs, cost inflation and extended construction periods will continue to suppress margins in this division for the next two financial years, with provisions made for anticipated losses,” it added.
It said sales and margins had been hit at its housebuilding division with the number of completions in the year standing at 180, compared to 210 in 2021.
And it admitted that since its trading update last September “the UK economic outlook for the UK housebuilding industry has deteriorated”.
Inland said the problems meant it has begun offloading non-core parts of its business which included nearly 3,000 plots in the green belt. It said an unconditional sale of this portfolio had been inked for £9.5m giving the firm a profit of £3.5m.
The firm said it had hit its target of getting net debt below £100m by the end of September with the latest figure coming in at £86.8m from £118.1m last time. It added that it had not had to make a provision for cladding repairs.