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L&Q鈥檚 investment in new housing has fallen 43% year-on-year, as it sought to conserve cash during the pandemic.

The housing association giant said in a statement to the stock market, published yesterday alongside its 2020/21 accounts, that it spent 拢584m on new housing in 2020/21, down from 拢1.02bn the previous year.

Spending on new social housing fell 41% to 拢523m, investment in new private housing dropped 56.6% to 拢38m, while partnerships housing spending fell 58% to 拢23m. 

The group also revealed that it completed 2,699 homes in 2020/21, nearly two-thirds of the 4,209-home target it set itself for the year pre-pandemic.

A spokesperson said: 鈥淎t the onset of the pandemic, we took decisive action to conserve cash flows by reducing our capital and operational spend, while ensuring we met our commitments to our residents and customers.

鈥漈hese short term, prudent measures resulted in a reduction in investment in new homes, but placed us in a strong position to manage the risks associated with an uncertain year.鈥�

Despite the missed target for completions, the 2,699 figure is still 11% higher than the previous year. Starts fell only slightly year-on-year from 3,945 to 3,818.

鈥淥ur delivery of new homes is behind target for the year primarily due to delays caused by the coronavrius pandemic lockdown, when our construction sites were closed for most of the first quarter of the year and have had to adapt capacity to enable them to operate safely within government requirements,鈥� L&Q鈥檚 financial statements said.

L&Q has also previously revised down its longer-term development plans in the face of increased costs of maintaining properties, including fire safety costs. New chief executive Fiona Fletcher-Smith said in March that the group is now targeting 3,000 homes a year over the next five years. Pre-pandemic it had been planning 100,000 homes over 10 years.

鈥淕rowth will not be at the expense of investing in our existing homes and services鈥�, it said in the accounts published today.

The group is investing 拢1.9bn in improving existing homes over seven years, including 拢339m for fire safety work.

L&Q鈥檚 turnover increased 14.9% to 拢1.05bn, while its operating surplus increased from 拢279m to 拢307m. Its total surplus fell from 拢414m to 拢208m but this was due to a 拢235m gift relating to the acquisition of housing association Trafford Housing Trust. Without this, surplus would鈥檝e increased 拢29m.

The group鈥檚 earnings before interest, tax, depreciation and amortisation (EBITDA) increased 23% year-on-year to 拢374m, while its net debt fell by 拢44m to 拢5.3bn

L&Q sold 1,681 homes, up from 1,463 last year, although sales profit fell from 拢39m to 拢36m.

The financial statements were published hours after L&Q announced to enable it to more easily deliver its 32,000-home pipeline.