07th Jan 2019

Fifth year of strong, rising profits at Strategic Team Group

Mixed-tenure housing specialist Strategic Team Group has bucked the trend in the construction sector reporting a rise in profits for the fifth consecutive year.

Mixed-tenure housing specialist Strategic Team Group has bucked the trend in the construction sector reporting a rise in profits for the fifth consecutive year.

Business highlights for the year 2017/18:

  • For the year ending 30 September 2018, STG delivered £2m EBITDA representing a 3.0% return on sales of £63m.
  • 78% of revenue has been achieved on the back of negotiated deals and land-led developments rather than open tenders.
  • Cash at bank of more than £2.5m as a result of strong operating cashflows.
  • An end of year order book standing at £87m with over 90% of 2018/19 turnover already secured and a pipeline of land and plots at its highest ever level.
  • Average development size growth of 33%.
  • Delivery of the company’s first open market sales site in Greater Manchester.
  • Completing the 1,000th home through the company’s Land Inclusive Development model.
  • Winning three contracts via Homes England’s DPP3 framework worth in excess of £15m.
  • Due to commence the Group’s first modular offsite construction project.

Andrew Watson, Managing Director commented, “These strong results are testament to the strategy we embarked upon five years ago. Our business is built on the solid foundations of strong customer relationships and deep market knowledge.

“We have built more than 400 homes this year and will build in excess of 500 in 2018/19 which includes our first land-led site opportunity for an institutional PRS developer, securing a place on their construction framework.

“Our continuing focus on quality of earnings, growing orderbook, pipeline of new mixed-tenure sites, and our ever-watchful eye on risk mitigation and management has provided our fifth year of strong rising profits and cashflows.

“In the current uncertain economic and political climate, all indicators suggest that investment in affordable housing, the shortage of supply, the need to unlock land, and a skills base shortage all point favourably to the dynamic yet flexible strategy STG has adopted to deliver and expand its current housing output.

“We continue to build quality cost effective homes and communities in the North of England, where people are proud to live, and call “home” and the Board looks forward to another year of successes.”