Mears sees profit jump and expects strong result in 2024

Pre-tax profit was up by a third last year, the housing services company said.

Mears Group’s shares rose on Thursday morning (Adam Davy/PA) (PA Archive)

Housing services company Mears Group reported a jump in profit and revenue in 2023 and said that it expects another “strong” result this year too.

The business said that it had made a profit of £46.9 million before tax, up 34% from the £34.9 million that it made in 2022.

Meanwhile, revenue rose 14% to £1.1 billion during the year, Mears said.

The business manages and maintains 450,000 homes in the UK, largely working with both central and local government. It employs more than 5,000 people across the country.

This is further evidence of central government increasingly looking to Mears to provide specialist housing support

Mears

The business said that it is “well placed” in a new contract it hopes to win with North Lanarkshire Council, on the outskirts of Glasgow.

The contract is set to start in July, run for up to 12 years, at £125 million a year. That would mean £1.5 billion over the course of the full contract.

Mears said that it had started new work under a Ministry of Defence contract, which provides housing and support for Afghans who were relocated to the UK after helping the British forces in Afghanistan.

“This is further evidence of central government increasingly looking to Mears to provide specialist housing support,” the business said.

The news comes a few months after Mears said that it expected to do significantly better than market expectations this year. That announcement sent shares up by around a 10th.

We are delighted to have delivered strong growth in revenues, profits and cash generation in 2023

Chief executive Lucas Critchley

On Thursday morning, as markets opened, they rose another 1.8%.

Chief executive Lucas Critchley said: “We are delighted to have delivered strong growth in revenues, profits and cash generation in 2023.

“The group is recognised as a leading housing specialist, and we continually look to evolve our capabilities to further strengthen our market position.

“The board believes that the group is well-positioned for the future and is pleased that the strong trading momentum built in 2023 has continued into 2024.”

Mears said that it had successfully submitted grant applications for around £40 million for its clients under the Social Housing and Decarbonisation Fund. This will contribute to works worth £120 million this year and next.