L&G offsite factory accumulated huge losses since opening in 2016
22 May 2023L&G Modular Homes, the landmark off-site homes factory in Leeds which announced earlier this month that it was stopping production, has reported total combined losses after tax of around £140m since it was first incorporated in 2015.
The 550,000ft2 factory originally opened with a blaze of glory and was seen as a futuristic modular homes business and was a big user of cross-laminated timber (CLT) in many of its homes, though it was using an alternative system for apartment projects.
A recent L&G announcement said it was ceasing new modular production at the factory and assessing potential strategic options for the business. It blamed the factory’s high significant fixed cost base and the failure to achieve a sufficient pipeline of work for the decision.
Planning delays and the Covid pandemic had contributed to insufficient project orders.
In its most recently published full accounts, posted in September, 2022, the company described reaching a milestone in 2021, recognising revenue for the first time in terms of development sites in Kent, Yorkshire and West Sussex.
But it also experienced challenges in 2021, when prices of steel and timber jumped significantly.
The company recorded a loss after tax of £29m in 2021 and held net assets worth £40m.
During the financial year, the business received £34.8m from its parent company – Legal & General Homes Holdings – to allow it to execute its strategy. Its revenue was £12.1m
The operating loss was £35.7m, with a £7.8m income tax credit reducing the losses slightly.
Total liabilities listed were £75m and the total 399 annual staff costs were £19.4m.
Earlier losses after tax were as follows: £25m for 2020; £24m in 2019; £16.7m in 2018; £37.9m in 2017; and £7.4m in 2016. The combined annual losses after tax total to date of around £140m.
The business had been led by Rosie Toogood since 2017. Former Panaloc MD Eric Dean had led the business previously.
