Mid-Year Update Report
On the back of a successful year to 31 October 2019 Keepmoat Homes made a strong start to the current financial year. Post-election market sentiment and robust demand were reflected in strong sales with the business trading in line with our expectations for the period to March, before the emergence of the COVID-19 pandemic.
As a responsible builder, Keepmoat Homes prioritised the safety of its people, its customers and the general public and took the decision to temporarily cease operations. Our development activity ceased from the start of April in a safe and secure way. Surplus PPE was donated to NHS Trusts and NHS Charities to support medical staff and key workers who were experiencing shortages at that time.
During the shutdown period, the business supported customers who had been ready to complete just as lockdown restrictions came into force, to ensure that they were able to move safely into their new homes.
Throughout the national lockdown interest and demand for new homes remained strong, with sales teams working remotely and many customers choosing to reserve their new homes online. As lockdown restrictions began to be eased in May, the business was able to implement its phased reopening programme and construction activity has now restarted on almost all of our developments. Our sales offices have also re-opened and we have created a bespoke online appointment booking system to allow customers to visit our sales centres and showhomes across the UK safely, in line with Government and Public Health guidelines. As lockdown restrictions have eased, trading has been encouraging, with strong customer demand.
The business has maintained close contact with its supply chain partners throughout to ensure we are able to restart sites as safely and efficiently as possible and has continued to pay all suppliers, subcontractors and service providers on normal terms. We also made use of the Coronavirus Job Retention Scheme, when our teams were placed on furlough, enabling us to protect the jobs of our c.1,100 employees and ensure the business was in a strong position to restart as soon as it was safe to do so. Throughout this period all employees including those on furlough were paid 100% of their salary. In addition, our Executive Board, the wider Leadership team and Regional Directors across the business took a voluntary 20% salary reduction for the period that sites were closed to support the business.
The Group has successfully extended its credit facilities by £27.5 million and its shareholders have invested in additional equity in the business. Whilst the prospects for the wider economy and its impact upon the new homes market remains uncertain, this additional funding provides greater flexibility as we return to a more normal way of working. Keepmoat Homes is operationally and financially well positioned due to its resilient Partnership business model, with a greater proportion of affordable homes delivered in partnership with RPs and to first time buyers across the UK.