TopHat posts further £19.4m loss

TopHat has reported a further £19.4m loss but insists it will make a profit within the next three years.

The Goldman Sachs-backed modular developer, in its results for the year to 31 October 2021, nearly doubled its turnover from £6.3m to £12.3m but still made a substantial loss. The £19.4m loss follows a £21.3m loss for the previous year.

The business, which was founded in 2016, however believes the opening of a second factory will help it into the black within three years. It plans to open Europe’s largest 3D modular homes facility in Corby, Northamptonshire next year.

Jordan Rosenhaus, director at TopHat, said the firm “is a young ambitious company that is still in its growth phase” and has attracted £130m of funds from investors including majority shareholder Goldman Sachs.

Rosenhaus said: “The group is not yet profitable or cash generative, due to this investment in future growth and innovation. The delivery of the second factory, in particular, will enable TopHat to deliver strong profitability and cashflow within the next three years.”

The developer, which has been backed by £130m of investment, currently operates from a 125,000 sq ft factory near Derby which can produce 800 homes year.

Modular developers typically take several years to post a profit due to the high levels of upfront capital needed for research and development. Another modular builder, Ilke Homes, reported a £41.2m loss for the year to March earlier this year.