Business has now racked up 拢174m of losses since inception
The modular housebuilding arm of insurance giant L&G has stayed in the red for the sixth consecutive year with a 拢37m pre-tax loss 鈥� despite finally reporting sales revenue for the first time.
According to accounts filed at Companies House, L&G Modular recorded a pre-tax loss of 拢36.8m for the 2021 calendar year, an increase on the , on turnover of 拢12.2m 鈥� its first recorded revenue.
After accounting for an income tax credit of 拢7.9m, the company, which was set up in 2016 to build hi-tech modular homes from a 550,000 sq ft factory outside Leeds, reported a final loss for the year of 拢29m.
The figures mean the firm has now racked up 拢174m of pre-tax losses since being created with an aim to disrupt the UK housebuilding industry by building 3,500 homes a year using modern methods of construction.
Despite the losses, the accounts show the firm improved its balance sheet in the year, growing its net assets from 拢35.1m to 拢40.9m, after parent company L&G injected 拢34.8m into the business in return for three new shares in the company.
The accounts statements said the accounts were prepared on a going concern basis after receiving confirmation of further ongoing support from L&G for at least the next 12 months.
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The figures come days after the firm revealed it had been for the 400-home redevelopment of a canalside brownfield site on the edge of the city-centre, taking the firm鈥檚 pipeline to more the 1,000 homes.
The statement accompanying the accounts show the firm approved a five year plan and detailed budget in the financial year, and noted the 鈥渟ignificant milestone鈥� of reporting its first ever revenue from its developments in Broadstairs, Kent; Selby, North Yorkshire; and North Horsham, West Sussex. It said it had made 鈥渟trong progress鈥� by adding further projects to its sales pipeline and developing partnerships with suppliers.
But it said that prices of timber and steel 鈥渏umped significantly鈥� during the year in the of the Covid crisis 鈥減utting significant pressure on the cost of producing homes鈥�.
The statement said cost reduction initiatives had helped reduce the impact of this but did not put numbers on the effects. The firm said it signed contracts with housing associations to build 180 homes in the years and that 鈥渋nterest from existing and potential customers remains strong鈥�.
Asked to explain the loss and say when the business would be profit-making, Rosie Toogood, chief executive of L&G Modular (pictured, left), said the firm 鈥渃ontinues to make significant progress with projects and partners, delivering much needed affordable, energy efficient homes at the time of an acute energy crisis鈥�.
She said the firm was on course to build 450 homes in 2022 and had already this year exceeded the revenue generated in 2021 鈥渉ighlighting the progress of the business鈥�. The firm鈥檚 first net zero carbon homes will go on sale at our site in Bristol next month, she added.
鈥淲e have been busy delivering homes on three major sites and are progressing planning applications on more as we grow our pipeline. We are already delivering some of the most energy efficient homes in the country. Our pipeline continues to grow following our selection as development partner for the regeneration of the Canalside South by the City of Wolverhampton Council where we will deliver 400 new homes.鈥�
Toogood has previously said that L&G Modular is aiming to build 3,000 homes a year by 2024.
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