Osborne transformation into a zero-carbon focussed business marks a return to profit
Osborne is pleased to have formally submitted financial accounts for the year ending September 2021, showing a profitable position at £0.7m. With an end of year net cash of £21.5m, this significant improvement means that it can move forward with confidence.
Osborne has completely re-positioned itself to take advantage of the zero-carbon agenda, by levering its extensive in-house offsite manufacturing experience and maximising its low carbon design expertise. The Osborne group of businesses are now all aligned to a common purpose and collaborating to create low carbon solutions with offsite products that are designed to support their customers in achieving their sustainability commitments.
The strategy of the Osborne 2016 Group Business Plan also set out to grow and prepare their Infrastructure Business for sale. The progression of this strategy has been extremely successful with the sale completed in September 2021, allowing the Group to concentrate on its remaining businesses with greater clarity of purpose and competitive advantage. The timing of the Infrastructure sale served to assist in offsetting the losses from a small number of construction projects in London, which have now completed. The sale also enabled the business to invest in its future and in creating more of its own developments and has seen the Group start to secure some excellent long-term opportunities. Operating business such as Innovaré (Offsite) and Property Services (Retrofit) are uniquely positioned in their respective rapidly growing markets, the future for Osborne is very exciting.
Offsite business Innovaré has invested in new plant and equipment and has broadened its factory-built product offering. As a panel member in LHC’s NH2 Framework for the offsite construction of new homes, and also being partner to a main contractor panel member for the Department for Education (DfE) MMC1 Framework for schools, Innovaré can see a strong pipeline of opportunity. Innovaré has grown its partnerships with main contractors and is increasing the scope of work undertaken within the factory to include cladding and windows. This increased scope is removing programme and safety risks typical of traditional on-site activities.
It is anticipated that the Osborne Property Services business will grow to become one of the largest businesses in the Group. Property Services has already been appointed to the GLA Retrofit Innovation Partnership and programmes are already in progress for two London boroughs. The Innovation Partnership is anticipated to be worth £4 billion with Osborne currently one of four supplier partners. Winchester City Council has awarded Osborne Property Services a five-year housing maintenance contract extension for responsive repairs and void management. The contract also makes further provision to include carbon zero housing retrofit schemes.
The Osborne Developments business has entered into a £250 million investment joint venture with PGIM to deliver and operate new Build to Rent homes, homes that are being self-built by Osborne.
The Construction business is still in the process of rebuilding but is making good progress having won places on several public sector frameworks. These include the DfE Construction Framework, secured using the Osborne “InForm” offsite school build solution, and the Sustainable Housing Development Framework. The latter adopts the “Flexihomes” low carbon offsite housing solution, manufactured in Innovaré’s factory in Coventry. Construction have also secured places on the London Construction Framework, City of London Framework and London Borough of Islington Framework and continue to enjoy regular repeat business from its existing public sector education and residential customer relationships.
Group Chief Executive Dave Smith commented;
“I am delighted with the progress being made in transforming the Osborne business and I am confident that we will continue to increase our profitability through the application of our in-house expertise in low carbon design, offsite manufacturing and delivery, along with increasing volumes of self-build development opportunities.
As we embark on this next phase of our business plan to 2025/26 I also recognise that the industry faces the significant external challenges of escalating inflation, economic and political uncertainty. My priorities, above all else will be the safety and wellbeing of people working on and impacted by our projects, delivering the promises we make to our customers and investors and carefully managing risks that balance business resilience with the speed of growth.
I anticipate that with our unique positioning and offerings in our key markets we will see revenues return to, and exceed, the levels achieved prior to the sale of Infrastructure. I am really excited by the huge opportunity in front of us as we continue our journey to providing a zero-carbon future for our customers.”