Chief executive report 2024

I’m very pleased to introduce Bromford’s 2024 annual report and accounts, and to report a strong set of results in what has been a challenging operating environment.

The past year has seen us navigate persistently high cost inflation, which has had a material impact on many of our customers and the cost of the service we provide, a government-imposed rent cap and an increasing legislative and regulatory environment. 

It is really pleasing to report an increase in customer advocacy from 83% to 91%, our highest level for five years. Running alongside this, the past year was the first one where we and our peers are reporting Tenant Satisfaction Measures (TSMs). Again and linked to our customer advocacy ratings, we are pleased to report overall tenant satisfaction at 85%.

We are very clear at Bromford that we exist for current, future and aspiring customers and related to this I am delighted to report another strong year for the delivery of much needed new affordable homes. In total we delivered 1,191 homes all of which are affordable and only marginally down on the 1,265 completed the previous year.

Over the past five years we have consistently delivered a high level of homes for social rent and have continued this again with 551 of the 1,191 being for social rent – the most affordable of homes for rent. The year saw us complete a further 332 homes for shared ownership and we finished the year with considerable demand which is reflected in our lowest number of homes available at year end in recent years.

During the year, we increased our investment in current homes by 14% to £64m and ended the year with 89% of our homes being at EPC rating C or above. In addition, we ramped up our regeneration activity completing 52 new homes on previously demolished sites and commenced decanting customers in a further 48 homes ahead of demolishing and rebuilding these homes. We believe we will need to ramp up this activity further as we seek to both decarbonise our homes and ensure that they are fit for purpose for the next 50 years. 

But we appreciate there is more to do. Disappointingly, we had 20 complaints upheld by the Housing Ombudsman, including five for severe maladministration, around the themes of delays to delivering repairs and complaint handling. We recognise the ongoing challenges, both at Bromford and across most of the housing sector and continue to make improvements through key learnings. 

Financially, I am pleased to report a strong set of results, particularly given the challenges over the year. Net Surplus excluding fair value adjustments increased from £64m to £67m, while operating margin and social operating margin remained strong at 30% (2023: 31%) and 34% (2023: 34%) respectively. Earnings before interest, tax, depreciation and amortisation (major repairs included) interest cover (EBITDA MRI interest cover) was again strong at 1.9x (2023: 1.9x).

Importantly for our future plans, we ended the year with continued strong levels of liquidity at £538m (2023: £455m) following the issuance of two private placements and reconstituting and increasing our Revolving Credit Facilities. We also continued to retain our G1/V1 regulatory status.

2023 to 2024 saw us complete our Bromford Strategy 2019 to 2023 and with it some important and material shifts as we progressed towards the completion of the build of our Microsoft Dynamics ERP platform. Having created the platform, we are now building on such with Microsoft and their AI capability. We believe that there is considerable benefit to be achieved in this.

The last year also saw us launch our new Bromford Strategy 2023 to 2027 which builds on the technological, operational and financial platforms we’ve built over the past few years. 

Our two key strategic shifts in the Bromford Strategy 2023 to 2027, sees us firstly, build on our neighbourhood coaching approach to one which is focussed on place and secondly, it will see us move more to scale in our new homes programme.

We believe that our neighbourhood coaching approach should be more dynamic and should work more in partnership with other organisations for the benefit of our customers. One such initiative is with the Church of England where we are not only helping to establish the Church of England Housing Association but more importantly we are increasingly working closely with colleagues in communities.

While many of our peers are reducing or withdrawing from building new homes, we have concluded that we can and should continue to not only build new homes and maximise the number of affordable homes, but work with partners to build or regenerate places - increasingly using our own construction company, which has continued to go from strength to strength over the past five years. 

Importantly having reviewed our performance and our new strategy, we have seen our dual credit ratings strengthen within the A2/A+ bandings, with stable outlook restored on both ratings and our S&P Global rating now standing up as A+ in its own right without any sovereign support. This provided confidence to our investors and other stakeholders.

I would like to finish by expressing my thanks to all colleagues at Bromford. We cannot deliver these results without a great team.

Robert Nettleton
Chief executive