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Churchill Retirement

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BDC 319 : Aug 2024

Churchill Retirement

Churchill Retirement sales soar 75% and targets 1,000 homes p/a as consumer confidence returns

Revenues rose by 75% to £160m, as Churchill sold 413 retirement homes in the twelve months to 30 June 2021, 48% more than the same period last year. The Group swung strongly back into the green, with sector leading margins of 26.9% generating an operating profit £43.0 million (vs loss of £5.8m in 2020). A firm rebound in consumer confidence has helped to generate strong momentum in sales activity, with 7% of future sales already secured as at 30 June 2021. New growth plan launched today, with a target of achieving 1,000 retirement home sales in 2025 whilst maintaining market leading margins, creating more jobs across every part of the Group and achieving a countrywide presence Chairman, CEO and co-founder Spencer McCarthy, who is the son of the co-founder of McCarthy & Stone, has also hit out at obstacles holding the sector back including the broken planning system and reversal of the exemption of retirement housing from a future ban on ground rent Commenting on the results, Spencer McCarthy, Chairman and Chief Executive Officer of Churchill said: “I am very pleased to report a strong financial performance and a return to profitable growth after a year dominated by our response to Covid-19. Our priority throughout the pandemic has been ensuring the health and wellbeing of our apartment Owners, Colleagues and wider stakeholders and I would like to thank them all for their continued support. During the year we saw a rebound in consumer confidence, with the loneliness of lockdown causing many people to think hard about their living situation and consider the benefits of moving to a safer, lower maintenance home with more support and opportunities to socialise. This helped to generate strong momentum in sales activity, which has continued to build since the third lockdown lifted in March 2021. With a strong forward order position, an experienced team, and a clear focus and understanding of what our Customers need, this underpins our confidence looking ahead. As a result, we are today announcing a new growth plan, with a target of achieving 1,000 property sales in 2025 whilst maintaining market leading margins, creating more jobs across every part of the Group and achieving a countrywide presence. There are now more than 12 million over-65s in the UK and that figure is expected to rise by 41 per cent to nearly 18 million by 2024. However, there is a severe shortage of housing being built specifically for these growing numbers of retirees. To meet demand, we need 30,000 more retirement housing dwellings every year for the next 10 years. Our growth plan will not only help take Churchill to the next level, but further support the UK’s growing need for retirement housing. Nonetheless, we continue to face an uphill battle in several areas where reform is desperately needed help to unlock the UK’s housing supply. The planning system remains broken, with protracted Section 106 negotiations and long appeal delays, and the reversal of the exemption of retirement housing from a future ban on ground rent will impact the supply of good quality, affordable retirement housing. These obstacles continue to hold back development and make it more difficult to deliver the genuine mix of housing types our country needs.”

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