Metropolitan Funding PLC Trading Statement - Q3 ended 31 December 2016 (5479X)

TIDM38EO

RNS Number : 5479X

Metropolitan Funding PLC

22 February 2017

Metropolitan Funding PLC

Metropolitan Housing Trust (MHT) trading update for the nine months ended 31 December 2016

MHT, one of the UK's leading providers of affordable housing and care and support services, announces a trading update for the end of Q3 for the financial year 2016/17.

Highlights

   --    419 new homes completed and on track to complete more than 800 new homes in the full year 
   --    Operating surplus up by more than 10% from last year 
   --    Underlying operating margin maintained at 38% 
   --    More than GBP430m of available liquidity

Brian Johnson, Chief Executive of Metropolitan, commented:

"Our financial performance remains strong with the organisation consistently hitting its targets. We are on track to deliver more than 800 new homes in the full year and to realise our ambition of delivering at a rate of 1,000 a year going forward. We are confident in the outlook for the remainder of 2016/17 and, with more than GBP430m of available liquidity, we remain well placed to deliver on our growth strategy."

Results overview

Turnover from Housing (including supported housing) is flat year-on-year with overall operating margins remaining close to 40%. Income from first tranche sales and outright sales are in line with budget and our units continue to sell at or above our anticipated prices. Operating surplus is up by more than 10% from last year, with operating costs (excluding exceptional pension costs in 15/16) below expectations. The organisation remains focused on cost efficiency and value for money to maintain margin. Operating cashflow remains strong, with more than GBP143m invested in new development projects YTD and an expected GBP57m projected in the final quarter, along with scheduled MHT YTD debt repayments of GBP46m. Underlying net interest costs (excluding mark to market movements in derivatives) are consistent with last year, following the bond issue in September 2015, and should be on budget based on the expected levels of capital expenditure.

The organisation completed 186 homes in Q3 (YTD total 419) and remains on track to deliver more than 800 new homes in FY17, up more than 120% on last year.

Outlook

Despite the market uncertainties triggered by the Brexit vote, core markets continue to perform well and the full year forecast is in line with management's expectations. Liquidity remains strong.

The Board expects to announce full unaudited results for the year ended 31 March 2017 in May 2017.

Homes and Communities Agency (HCA)

On 22 February 2017 the HCA published its revised strapline for Metropolitan Housing Trust and upgraded the organisation to V1/G1 for financial viability and governance

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/593179/Metropolitan_Housing_Trust_Limited_RJ_Feb_2017.pdf

(see https://www.gov.uk/government/publications/regulatory-judgements-and-regulatory-notices for background information). This revised strapline is a result of the In-Depth Assessment of Metropolitan in September 2016.

Brian Johnson, Chief Executive of Metropolitan, commented:

"We welcome the HCA's judgement which means that Metropolitan now has the top 'V1' rating for financial viability in addition to the top 'G1' rating for governance. This is a fantastic achievement and testament to the hard work put in over the last four years to make Metropolitan the financially strong and high-performing organisation that it is today."

Clapham Park Homes Ltd

The Board are pleased to announce the successful Transfer of Engagements of Clapham Park Homes Ltd into Metropolitan Housing Trust Limited on January 26 2017.

Changes to the Metropolitan Executive Team

The following changes have been made to the Executive Team:

Richard Vining - Resigned as Executive Director of Development

Linda Robinson - Appointed Interim Executive Director of Development

Daniel Jones - Appointed Executive Director of Insight and Innovation

Enquiries

Please contact Donald McKenzie, Head of Corporate Finance, on 0203-535-4434 or at donald.mckenzie@metropolitan.org.uk

This information for investors is also available on our website:

https://www.metropolitan.org.uk/about-us/investing-in-metropolitan/

Notes

   --      Operating margin is operating surplus/turnover

Disclaimer

The information in this preliminary results announcement has been prepared by the Metropolitan Housing Trust group and is for information purposes only.

The results announcement should not be construed as an offer or solicitation to buy or sell any securities issued by the Parent, the Issuer or any other member of the Group, or any interest in any such securities, and nothing herein should be construed as a recommendation or advice to invest in any such securities.

This unaudited preliminary announcement contains certain 'forward-looking' statements reflecting, among other things, our current views on markets, activities and prospects. Actual and audited outcomes may differ materially. Such statements are a correct reflection of our views only on the publication date and no representation or warranty is given in relation to them, including as to their completeness or accuracy or the basis on which they were prepared. Financial results quoted are unaudited. We do not undertake to update or revise such public statements as our expectations change in response to events.

This information is provided by RNS

The company news service from the London Stock Exchange

END

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