48
Integrated Annual Report 2020-21
Financial review
It has been another year of change and turbulence across the Higher Education sector due to the impact of the COVID-19 pandemic on our students, staff, other stakeholders and the wider financial environment. However, due to actions taken in reaction to the COVID-19 pandemic and targeted investments made last year, we were able to deliver a strong surplus and EBITDA result and preserve healthy year end cash balances. We have confidence that our strategy, and implementation of robust cost-control measures, will protect Winchester’s financial position and enable delivery of the best possible experience for students under the current conditions. Our key financial sustainability measures, outlined in the table above, reflect a year-on-year improvement as we were able to draw upon out investments made in 2019/20. These investments included ‘Covid-secure’ campus measures and investments in technology to enable hybrid teaching. Strong student recruitment and savings resulting from a reduction in student and staff activity over almost an academic year of lockdown have significantly improved our financial outturn for 2020/21. Our £5.0m reported surplus for the year comes despite the ongoing challenges presented by the pandemic which included £1.7m of accommodation refunds resulting from the Government imposed restrictions on students returning to campus in January 2021. In addition, the Government and the University invested a total of £1.9m in student hardship and support, including financial support for IT poverty to our most vulnerable students and those adversely impacted by the pandemic.
Our cash flow also benefitted from this reduction in activity and, coupled with our careful cash management, has meant that Winchester’s cash in hand did not fall below our treasury management financial sustainability level of 10% of turnover (£8.4m), at any point during the year. Cash for the year showing a £6.0m improvement in our net cash inflow from operating activities and a cash and investments balance of £35.1m at 31 July 2021. However, we are still challenged by uncertainty that the pandemic has
caused and continue to regularly review and update our medium and long-term financial forecasts. However, our strong performance for 2020/21 exceeded budget expectations and provides a strong financial foothold from which to face another challenging year ahead. This Financial Review (pages 48 to 54) puts the year in perspective and outlines our financial environment, finance strategy, financial KPIs, financial performance and our future outlook.
KPI HIGHLIGHTS 2020/21
2019/20
Change
Surplus (£m)
5.0
1.5
3.5
EBITDA (£m)
16.3
10.3
6.0
Net cash inflow from operating activities (£m)
17.0
11.0
6.0
Staff cost % income
54%
57%
-3%
Net cash / (borrowing) (£m)
2.2
-10.8
13.0
