KPIs
How we performed
New housing revenue (£m)
-31%
Definition
Revenue generated from the legal completion of new homes to our private customers and housing association partners.
Why we measure it
Strength of housing revenue is an important measure of the success of our strategy. Our range of house types and emphasis on quality homes at a range of price points puts us in a strong position in our markets.
Forward sales at 31 December (£m)
+2%
Definition
Anticipated revenue for future home sales to private customers and contracts with housing associations that have yet to legally complete.
Why we measure it
Forward sales give us an indication of the level of demand we have for homes going into future periods. This allows us to ensure we are controlling work in progress to meet demand and maintain strong financial discipline.
Underlying new housing operating margin (%)*
-13.2ppts
Definition
Based on operating profit before legacy buildings provision and goodwill impairment (underlying operating profit) and new housing revenue.
Why we measure it
We have a strong track record of delivering industry-leading returns and we monitor our performance to ensure continued discipline in our approach.
Underlying profit before tax (£m)**
-64%
Definition
Stated before legacy buildings provision and goodwill impairment.
Why we measure it
Our disciplined land replacement processes, cost management and efficiency programmes aim to generate superior returns which provide a platform for further investment in the Group’s resources to support our future growth.
Free cash generation (£m)***
-£546m
Definition
Net cash flow before financing activities.
Why we measure it
We use this to measure balance sheet strength and liquidity. Ensuring we have an appropriate capital structure to support the business through the cycle is key to our success.
Net cash (£m)
-£442m
Definition
Cash and cash equivalents, bank overdrafts and interest-bearing borrowings.
Why we measure it
Ensuring we have an appropriate capital structure to support the business through the cycle is key to our success.
Return on average capital employed (%)****
-19.9ppts
Definition
12-month rolling average calculated on underlying operating profit and total capital employed. Capital employed being the Group’s net assets less cash and cash equivalents plus land creditors.
Why we measure it
Our focus on return on average capital employed allows us to measure the efficiency of our use of capital. We will continue our disciplined approach to working capital management to meet market demand.
Net assets per share (pence)
-1%
Definition
Calculated as the total value of the Group’s assets minus total liabilities divided by the number of shares in issue.
Why we measure it
Net asset value per share movement is an indicator of the value that we are delivering for our shareholders. We have a good track record of delivering strong returns for our shareholders through the cycle.
Notes
* Based on new housing revenue (2023: £2,537.6m, 2022: £3,696.4m) and underlying operating profit (2023: £354.5m, 2022: £1,006.4m) (stated before legacy buildings provision (2023: nil, 2022: £275.0m) and goodwill impairment (2023: £7.6m, 2022: £6.6m)).
** Stated before legacy buildings provision (2023: £nil, 2022: £275.0m) and goodwill impairment (2023: £7.6m, 2022: £6.6m). Profit before tax after legacy buildings provision and goodwill impairment is £351.8m (2022: £730.7m).
*** Free cash generation is defined as net cash flow before financing activities and before £nil of employers’ National Insurance contribution payments in respect of share-based payments (2022: £nil, 2021: £nil, 2020: £0.7m, 2019: £13.9m).
**** 12-month rolling average calculated on underlying operating profit and total capital employed (including land creditors). Underlying operating profit is stated before legacy buildings provision (2023: £nil, 2022: £275.0m) and goodwill impairment (2023: £7.6m, 2022: £6.6m).