Key Performance Indicators
Definition and performance
Definition
This represents revenue which is predominantly generated through the sale of both private and affordable new homes; and to a lesser extent from the sale of land, where it is capital efficient to sell a portion of larger sites; and revenue from external sales generated by Walker Timber.
Performance
Revenue increased by 12% in 2022 due mainly to a 4% increase in both core completions in ASP and to a lesser extent an increase in land sale revenues and the first full year of trading from Walker Timber.
Definition and performance
Definition
This represents revenue from new home sales divided by the total number of core completions. In line with standard accounting practice, this excludes revenue from homes sold through joint ventures, the profit on which is shown within “share of result in joint ventures”. It measures movements in revenue per unit caused by house price inflation, location or mix changes.
Performance
ASP increased by 5% to £275,000 (2020: £261,000). This reflected a 6% increase in the private ASP to £320,000 (2020: £303,000) and a 15% increase in the ASP of affordable homes to £139,000 (2020: £121,000). The improvement in ASP more than offset the impact of an increase in the proportion of affordable homes which rose to 25% (2020: 23%) of core completions
Definition and performance
Definition
This represents gross profit excluding exceptional items divided by revenue. It measures the Group’s underlying profitability before administrative expenses.
Performance
The reduction in 2022 was mainly driven by the impact of HPI/CPI, which, whilst margin dilutive, ultimately resulted in a higher gross profit per plot of £72,000 (2021: £69,300).
Definition and performance
Definition
This represents operating profit excluding exceptional items divided by revenue. It measures the Group’s underlying profitability after administrative expenses.
Performance
The reduction in 2022 principally reflects lower gross margins.
Definition and performance
Definition
This represents operating profit excluding exceptional items expressed as a percentage of average capital employed, which is the average of the opening and closing balances of capital employed for each financial year.
Performance
The increase in the year reflects a 6% increase in operating profit pre exceptional items, offset by an increase in average capital employed, which in turn is largely due to a higher net inventory.
Definition and performance
Definition
This represents cash generated in the year excluding cashflows from financing activities, investing activities (other than movement in loans to joint ventures), corporation tax paid, interest paid and transaction costs.
Performance
Free cash generation of £152m was down on the prior year figure of £175m. However, free cash generated in the year equated to an EBITDA conversion ratio of 76%, which is higher then the Group's target of 50%. This was due to reduced land spend in the second half of the year.
Definition and performance
Definition
This represents the number of reservations (net of cancellations) for private homes (including those sold via joint ventures) divided by the average number of sales outlets and further divided by the number of weeks in each financial year.
Performance
The private sales rate was down significantly in 2022 due primarily to market conditions in the second half of the year which led to a sales rate of 0.40 over this period. The full year sales rate of 0.62 is broadly in line with our experience in the pre-pandemic years.
Definition and performance
Definition
This represents land from the Group’s owned and controlled landbanks. All land in the consented landbank benefits from at least an outline planning consent, or a resolution to grant planning consent.
Performance
The owned landbank fell by 11% to 10,724 plots (2021: 12,057 plots) following the curtailment of land purchases in the second half of the year in response to a more negative trading outlook. The controlled landbank increased slightly to 3,190 plots (2021:3,112), resulting in an overall consented landbank of 13,914 plots (2021: 15,169 plots), 8% down on last year.
Definition and performance
Definition
This represents land which the Group has secured via an option to purchase at a future date on receipt of an implementable planning consent. The land currently does not benefit from a planning consent although it may have been allocated for residential development in the relevant local plan.
Performance
The strategic landbank was broadly unchanged at 39,203 plots (2021: 39,222 plots). The Group continued to invest in new opportunities, with 7 new options (1,164 plots) being added to the landbank during the year, which was partially offset by 840 plots being transferred to the consented landbank with the residual difference due to re-plans.
Definition and performance
Definition
This represents the value of new home reservations and contracts exchanged at each financial year end which are anticipated to result in core and joint venture completions in the following 12 month period.
Performance
Forward sales decreased by 28% to £481m (2021: £665m). The reduction in the year reflects a combination of an abnormally high opening position and a weakening sales market in the second half of the year. The 2022 year-end balance of £481m is still significantly ahead of the last pre-pandemic year in 2019 of £328m.
Definition and performance
Definition
This represents an external assessment, performed by the National House Building Council (NHBC) on behalf of the Home Builders Federation (HBF), and measures overall satisfaction of our customers in respect of both the quality of their new home and the service provided.
Performance
The Group continued to operate with high levels of customer satisfaction and in March 2023 was awarded the HBF 5 star rating customer satisfaction for the eleventh time in the last 12 years.
Definition and performance
Definition
This represents the total number of accidents reportable under RIDDOR as expressed by 100,000 employees and subcontractors.
Performance
This was a 6% improvement in the AIR score in the year with a strategy set for 2023 which is designed to drive further improvement.
Financial Group Summary
|
2022 £m |
2021 £m |
2020 £m |
2019 £m |
2018 £m |
|
|---|---|---|---|---|---|
| Group revenue | 1,169.0 | 1,045.8 | 664.8 | 841.4 | 747.0 |
| Gross profit* | 282.5 | 261.6 | 156.7 | 210.7 | 192.0 |
| Operating profit before financing costs* | 217.3 | 203.6 | 114.8 | 167.9 | 151.1 |
| Operating margin* | 18.6% | 19.5% | 17.3% | 20.0% | 20.2% |
| Profit before tax* | 180.3 | 156.1 | 64.4 | 122.1 | 102.1 |
| Net assets | 607.2 | 496.1 | 378.6 | 332.1 | 239.6 |
| Net external debt | (157.7) | (241.4) | (200.9) | (251.5) | (299.9) |
| Capital employed (excluding intangible assets) | 631.2 | 595.5 | 588.1 | 578.0 | 521.9 |
| Return on capital employed* | 35.4% | 34.4% | 19.7% | 30.5% | 30.4% |
| Unit sales | |||||
| Core completions | 3,921 | 3,775 | 2,544 | 3,328 | 2,954 |
| Total (including joint ventures) | 3,970 | 3,849 | 2,620 | 3,498 | 3,170 |
| Average selling price (£'000) | 286 | 275 | 261 | 249 | 249 |
The figures above represent the results of Miller Homes Group Holdings plc. 2017 figures represent full year pro forma figures. * Pre-exceptional items