Legal & General (L&G) suffered a loss of more than £20m in its modular home building division last year.
The latest accounts for L&G Homes Modular show the business reported an operating loss of £20.6m last year. However, the loss was less than the £46.15m reported in 2017.
Parent company L&G invested £23.2m into the Legal & General Modular Homes venture during the year. L&G has injected more than £90m in to the business since it was established in 2015.
The company aims to build 3000 homes a year using construction methods used in manufacturing industries such as aerospace and automotive.
Homes will be built off-site at L&G’s factory in Sherburn in Elmet, near Leeds before they are transported and reconstructed on-site.
The firm delivered its first set ofmodular homes to housing association Silva Homes in December last year. It constructed eight new homes at a development in Berkshire.
The venture said it plans to expand its pipeline this year.
“The business has started to develop a portfolio of commercially-viable new products which are targeted across different sectors,” L&G Homes Modular said in its annual results statement.
“The company has worked with key stakeholders and partners on the new product development programme which will continue at pace during 2019.
“The company will expand its sales pipeline and order book in 2019, whilst starting to deliver modular homes in increasing volumes to its customers.”
L&G told The Sunday Times: “In common with many other engineering product-based businesses, our business plans [foresaw] a number of years of upfront investment would be required to develop the products and processes required to enable to business to deliver profitably at scale.”
Main image credit: L&G