NHG hits 40% of milestones in plan to return to compliance 

Patrick Franco, chief executive officer at NHG, said: “As an organisation undergoing a significant transformation, I am pleased with the progress we have made in the first half of the financial year.

“We have strengthened the fundamentals of the organisation, increased our investment in residents’ homes and improved the service we provide, while also maintaining a robust financial position.”

On the regulatory front, the percentage of buildings with both an in-date fire risk assessment and no overdue actions has increased to 90% in quarter two, up from 75.7% a year ago.

In preparation for Awaab’s Law, the landlord said it had “significantly reduced the number of homes affected by damp and mould from 2,635 cases to 1,952 and [currently has] no outstanding Category 1 cases”.

In addition, stock condition surveys have been completed on just over 77% of its homes in the last five years, and NHG described its building safety programme as “on track and within budget”.

Remediation work is expected to be complete on six blocks in the first half of the year, and has been started on a further two. Nine more blocks are due to be remediated in the remainder of the financial year.

As NHG works towards regulatory compliance, turnover was down 3.5% for the period to £350m. This was primarily driven by delays in development schemes.

NHG started 28 homes on site, and 525 homes were completed.

Pre-tax surplus was also down from £37.4m to £23.3m. Investment in NHG’s existing stock was down more than £100m, but still tops £1.08bn.

The London landlord told the stock market: “We maintained a disciplined approach to costs, despite seeing year-on-year increases resulting from inflationary rises, and are targeting further efficiencies in the year ahead.

“Our operating surplus is down year on year due to the timing of this trading update in relation to recognition of service charge income compared to last year.”

NHG more than doubled the homes it sold compared to last year with 89 home sold, which is in line with its new build shared ownership sales programme.

This is the latest update since September, where the landlord revealed a widening of its annual deficit to £130m after fire safety provisions and a revaluation of its build-to-rent assets took their toll.

Mr Franco added: “Looking ahead, we have clear plans in place to maximise operational efficiencies by focusing our activities on London, to continue deleveraging through strategic asset disposals and to improve the quality of our residents’ homes, powered by £800m investment over the next 10 years.

“We remain on track to deliver these plans, to deliver growth in 2025-26 and to further strengthen our financial resilience in the years ahead.”