Group Financial Statements 2012 - Riverside

Group Chairman’s statement
These financial statements provide important
evidence about how Riverside is responding
and give an indication of how the Group is
likely to fare over the coming months and
years. I believe they demonstrate that, despite
all the challenges in our external environment,
Riverside continues to thrive.
Thank you for taking the time to read Riverside’s
financial statements for the year 2011/12. Whilst this
document primarily concerns itself with numbers, they
help tell an important story about the health and
resilience of Riverside as an organisation. Let me put
them in context.
It is now almost a cliché to state that we are living
through an era of profound change, rooted in a
succession of economic shocks and the way these
are playing out for governments, businesses and
households. Yet for once the hyperbole seems
appropriate, and it has become increasingly
difficult for even the experts to anticipate what is
coming next.
We cannot escape the fact that the UK’s economy
has shrunk at an alarming rate, and recovery is likely
to take far longer than anyone could reasonably have
predicted, with ongoing uncertainty fuelled by the crisis
in the Euro zone. The government’s response, founded
on a determination to reduce the national deficit at an
ambitious pace, means that public services have been
scaled back at an unprecedented rate, with arguably
the worst still to come. In the world of housing, subsidy
to develop new affordable homes has been reduced by
two thirds, at a time when the need to build more has
never been greater.
And for our customers, whilst most households have
faced a real reduction in incomes, at times like these
it is the poorest who bear the brunt, as they are
exposed to rising unemployment and stringent cuts
in welfare benefits.
These financial statements provide important
evidence about how Riverside is responding and give
an indication of how the Group is likely to fare over
the coming months and years. I believe they
demonstrate that, despite all the challenges in our
external environment, Riverside continues to thrive.
We are certainly not immune from wider economic
pressures, however as an independent social business
with an income stream underpinned by the inexorable
growth in demand for our housing products, and
a portfolio of assets worth £1.7bn, we are better
equipped than many others to face the future with
confidence, manage risk, and even see opportunity
where others see threat.
This year we have generated a bottom line surplus
of £22.1m, of which £11.6m was generated through
the fair value accounting for our new Scottish
subsidiary, Irvine Housing Association, on its joining
the Group. This represents a return of around 8% of
annual turnover.
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