Decision

Current regulatory judgement: Coastline Housing Limited (17 January 2024)

Updated 17 January 2024

Applies to England

RSH Narrative Regulatory Judgement

• Provider: Coastline Housing Limited
• Regulatory code: LH4165
• Publication date: 17 January 2024
• Governance grade: G1
• Viability grade: V2
• Reason for publication: Changed basis for viability grade
• Regulatory route: Stability Check

Regulatory judgement

This regulatory judgement confirms the regulator’s existing published assessment of Coastline Housing Limited’s governance and financial viability grades (G1/V2).

The regulator has assurance that Coastline Housing Limited (Coastline) continues to comply with the financial viability elements of the Governance and Financial Viability Standard and that its financial plans are consistent with, and support, its financial strategy. Coastline has an adequately funded business plan with sufficient security in place and is forecast to continue to meet its financial covenants.

Coastline has reduced its exposure to the risk of volatility in interest rates, however its capacity to manage its debt position remains dependent on generating revenue from sales. Coastline’s interest cover has also weakened as it continues to develop and invest in existing homes.

These factors, set in the context of economic pressures including inflation and interest rates, impact on Coastline’s capacity to respond to adverse events.

The regulator’s assessment of Coastline’s compliance with the governance elements of the Governance and Financial Viability Standard remains unchanged. On the basis of the Stability Check, the regulator has concluded that there is no evidence to indicate a change to Coastline’s current governance grading.

Other providers included in the judgement

None

About the provider

Origins

Coastline is a registered charity. It was incorporated in 1996 following a stock transfer from Kerrier District Council.

Registered Entities

Coastline Housing Limited is the only registered entity in the group.

Unregistered Entities

There are four unregistered entities in the group:

• Coastline Services Limited, a building maintenance and grounds contractor;

• Coastline Design and Build Limited is a design and build contractor;

• Coastline Homes Limited is a design, construction and sale of residential housing contractor; and

• Coastline Care Limited which remained dormant throughout 2022/23.

Geographic Spread and Scale

Coastline owns and manages around 5,300 homes in Cornwall.

Staffing and Turnover

The group employs 301 full-time equivalent staff. Group turnover for the year ended 31 March 2023 was £36.7m.

Development

Coastline plans to develop around 900 homes between 2024 and 2027, including homes for social and affordable rent and shared ownership.

About our judgements

Key to Grades

Governance:

	Compliant
G1	The provider meets our governance requirements.
G2	The provider meets our governance requirements but needs to improve some aspects of its governance arrangements to support continued compliance.

	Non-compliant
G3	The provider does not meet our governance requirements. There are issues of serious regulatory concern and in agreement with us the provider is working to improve its position.
G4	The provider does not meet our governance requirements. There are issues of serious regulatory concern, and the provider is subject to regulatory intervention or enforcement action.

Viability:

	Compliant
V1	The provider meets our viability requirements and has the financial capacity to deal with a wide range of adverse scenarios.
V2	The provider meets our viability requirements. It has the financial capacity to deal with a reasonable range of adverse scenarios but needs to manage material risks to ensure continued compliance.

	Non-compliant
V3	The provider does not meet our viability requirements. There are issues of serious regulatory concern and, in agreement with us, the provider is working to improve its position.
V4	The provider does not meet our viability requirements. There are issues of serious regulatory concern, and the provider is subject to regulatory intervention or enforcement action.

Note: The use of an asterisk (*) against a grade indicates that the assessment refers to a provider that is designated as being for-profit.

Definitions of Regulatory Routes

In Depth Assessment (IDA): An IDA is a bespoke assessment of a provider’s viability and governance, including its approach to value for money. It involves on-site work and considers in detail a provider’s ability to meet its financial obligations and the effectiveness of its governance structures and processes.

Stability Checks: Based primarily on information supplied through regulatory returns, a Stability Check is an annual review of a provider’s financial position and its latest business plan. The review is focused on determining if there is evidence to indicate a provider’s current judgements merit reconsideration.

Reactive Engagement: Reactive engagement is unplanned work which is triggered by new information or a developing situation which may have implications for a provider’s current regulatory judgement.

Stability Checks and Reactive Engagement: In some cases, we will publish narrative regulatory judgements which combine evidence gained from both Stability Checks and Reactive Engagement.

For further details about these processes, please see Regulating the Standards.