Contents 02 Highlights 2015 03 From our Chief Executive 04 About us 05 Our Southern focus 06 Helping to shape the future of housebuilding 08 Creating great places 12 Building skills 13 Working with the supply chain 14 Environmental responsibility HIGHLIGHTS 2015 DELIVERED ANOTHER RECORD YEAR OF RESULTS £804.8m sales revenue ≥26% INCREASING DELIVERY OF QUALITY NEW HOMES 2,725 new homes delivered ≥8% IMPROVING LOCAL INFRASTRUCTURE £164.4m combined contributions, Section 106 and Community Infrastructure Investment Levy LEADING IN SUSTAINABILITY 1st place in the NextGeneration benchmark of top 25 housebuilders, with a top score of 83% This report is a summary of the Group’s strategy and performance for the financial year to 31 st October 2015. For further details see our full integrated report on www.crestnicholson.com/investor-relations.
Crest Nicholson 03 FROM OUR CHIEF EXECUTIVE BALANCED COMMUNITIES Stephen Stone Chief Executive We are conscious that both purchasers and policymakers wish to see the supply of new homes increase. With this in mind we are working to ensure that Crest Nicholson’s contribution is a strong one, and we have continued to increase our delivery of new homes, collaborating with local councils, government and project partners to drive volume in regions where demand continues to outstrip supply. During the year we progressed our Private Rented Sector (PRS) offering, which saw us enter into a contract with M&G Real Estate to deliver private rental units at Kilnwood Vale in West Sussex – our first purpose-designed suburban PRS model. We have also progressed other partnerships, which include our regeneration development in Southampton – Centenary Quay – with the Homes and Communities Agency (HCA) and two significant Garden Village projects with the Defence Infrastructure Organisation (DIO). Sustainable value creation We work hard to ensure our activities and developments make a positive contribution in our communities. For Crest Nicholson, sustainability is about balancing and supporting socio-economic and environmental considerations in what we build and how we build it. This includes fostering long-lasting communities, providing sustainable transport links, building high quality homes, responsibly sourcing materials, improving energy efficiency and supporting local economies through inward investment and job creation. New homes delivered in 2015 2,725 total new homes As part of our commitment to supporting the future of the housebuilding sector, we have pledged to hire and support 200 apprentices by 2020, developed our graduate programme and launched our first Site Management Academy to provide a future talent pipeline in the business. Our approach has been proven by achieving first place in the NextGeneration sustainability benchmark of the top 25 housebuilders. In the year we also maintained our position in the FTSE4Good Index and significantly improved our score in the Carbon Disclosure Project. Customer service Our commitment to quality has not translated into the highest possible customer satisfaction levels this year. As a company traditionally rated 5-star in the Home Builders Federation (HBF) survey, we were extremely disappointed with 4 stars in 2015 – a result that was influenced by delays and quality challenges on some projects, often linked to supply chain issues as the sector seeks to grow in response to rising demand for new homes. 574 affordable homes (21%) ≥8% increase compared to 2014. > Targeting 4,000 homes by 2019. We are determined to regain our 5-star status and have implemented a range of measures to support this. The five-year outlook in the sector remains strong.” Outlook The five-year outlook in the sector remains strong. A supportive government policy framework will continue to be important to delivering increased housing volume. Despite ongoing constraints in the planning system and supply chain production capacity, I am confident that our business strategy and the Group’s core strengths provide a strong platform for successfully meeting our growth targets. Stephen Stone Chief Executive 402 rented (70%) 172 shared ownership (30%)