Lovell has shown resilience against a softer housing market through its partnership housing model. Across the business, contracting activity was up by 43% and the rate of forward sold affordable homes rose by 44%, helping to support the UK’s acute need for high-quality affordable housing.
Growth and investment was also seen within Lovell Partnerships’ retrofit and refurbishment arm, with further expansion expected as the business works towards its sustainability aspiration.
While there was a slowdown in the sale of private homes on mixed-tenure sites, due to the cost-of-living crisis and rising mortgage rates, revenue across Lovell Partnerships is up by 20% in the year to £838m, with an operating profit of £30.5m along with a return on capital employed of 12%. The secured order book at the year-end was £2.034bn, representing a 3% improvement on last year’s position and a clear reflection of the successful strategic growth and partnership model. These results have bolstered the overall results of parent company, Morgan Sindall Group plc, whose full year results were published to the London Stock Exchange this morning.
The Group delivered a strong performance in 2023 against a difficult market backdrop. The results were another record for the Group and reflected the strength and breadth of the Group’s operations and the talent and commitment of its people.
Group revenue increased by 14% to over £4.1bn, while adjusted operating profit before tax was up 6% to £144.6m. The Group’s balance sheet remains strong with net cash of £461m, and its high-quality secured order book of £8.9bn, up 5% on the prior year leaves the Group well-positioned for the future and on track to deliver a result for 2024 in line with its current expectations.
Lovell Managing Director, Steve Coleby, said: “As a business, we are doubling down on our efforts to create homes with our partners that are accessible to all, and that shape vibrant communities across the UK.
“Our 2023 performance against challenging market headwinds, is testament to our partnership housing model, and the tenacity of our dedicated colleagues. As we move into 2024, we are committed to supporting our partners to create high quality homes in sustainable, inclusive communities.
“We continue to invest into the areas we work, not just with the homes and places we create, but also through our sustainability and social value initiatives too. This investment will help to build tomorrow’s homes, bring communities together and provide a platform for a more diverse and inclusive housing industry for the future.”
Lovell is working on a number of key projects across the UK, including:
South Wales and West – Lovell is delivering 400 homes in Wiltshire at Drummond Park. Located on the site of a former Defence Medical Equipment Depot, the scheme has provided ex-service personnel with the opportunity to join the construction team, not only gaining valuable experience, but also building homes for themselves.
Scotland – Lovell recently launched a brand-new development of 398 mixed-tenure homes, including two, three, four and five-bedroom villas and two-bedroom apartments on a development in South Queensferry, 10 miles north west of Edinburgh.
North East – The team in the North East began work on 124 homes in the mining town of Spennymoor, County Durham, which includes two, three and four-bedroom homes, with 100% of homes offered as affordable housing.
Eastern - Lovell is working on a number of key projects in the Eastern region, including the Cocoa Works in York, an ongoing £23 million contracting scheme of 103 homes for Clarion Housing. The aim is to deliver open market and affordable housing in the area, which will go a long way to aid the regeneration of Clifton.
East Midlands - Lovell is delivering a sustainable development on Beckhampton Road in Bestwood, Nottingham. Delivered through close partnership working with Nottingham City Council and designed to suit a range of housing needs, many families were able to move in just in time for the festive period.
East Anglia – Lovell is building 354 homes at Briarswood, Harleston, including 151 affordable homes, and has three show homes and two view homes opening there this spring. This work will see the team continue to develop sustainable and accessible housing across East Anglia to meet increasing demand.
Southern – Lovell Partnerships’ latest region opened its doors in 2023 and has just begun construction works on the first project of a multi-unit joint venture with West Sussex.
London – The London team signed a historic JV with Peabody to deliver the second phase of Peabody’s seven-phase regeneration masterplan for South Thamesmead. The 50:50 partnership will provide 329 mixed-tenure homes, with 42% ringfenced as affordable.
South West – In a joint venture with Abri, Lovell, is bringing forward Bincombe Park, Weymouth. A collection of 500, two, three and four-bedroom homes and bungalows, including affordable and open market homes.
Midlands - Lovell is working on a number of key projects in the West Midlands, including its Wild Walk project. Delivered in partnership with Telford and Wrekin Council, Nuplace and Wrekin Housing Group, this innovative development features a range of tenures to help address housing need in the local area.
North West – The North West team is coming to the conclusion of a 264-acre inner-city regeneration scheme in Miles Platting, East Manchester, which, once complete, will have delivered 1,000 new homes and 1,520 refurbished council properties, alongside new public spaces.
To view the Morgan Sindall Group plc full year results video, click here.
