H+h International A/s · OMXCOP:HH
H+h International A/s — Investor Presentation (December 2020)
38 slides from H+h International A/s's investor presentation, Dec 10, 2020
Slide 1: H+H UK Limited
H+H UK Limited 10th December 2020
Slide 2: Agenda
Agenda • History of UK Housing Market • Current Situation • Market Fundamentals • Trends in the Market • Challenges and Opportunities • How do the Government achieve their 300k homes per annum target?
Slide 3: History of UK Housing Market
History of UK Housing Market
Slide 4: History of UK Housing Market
History of UK Housing Market Current completions are still at intergenerationally low levels, leaving scope for future growth in the housebuilding market. Housing completions – mid-case scenario Housing completions k, GB k, GB Historic Period of growth/stability Historic Period of decline ~40% drop
Slide 5: Current Situation
Current Situation
Slide 6: Net additions to Housing Stock
Net additions to Housing Stock Net housing supply in 2019/20 at highest level for more than 30 years • The Ministry of Housing, Communities and Local Government has today published annual housing supply statistics showing that net housing supply in England reached 243,770 in 2019/20. • The figures c
Slide 7: Private House Building Output
Private House Building Output
Slide 8: Housing Market Activity
Housing Market Activity Sales market activity in context 150% — Inventory 100% New inventory flow — Sales agreed (SSTC) 50% Annual % change 0% -50% -100% -150% Feb19 May 19 Aug 19 Nov 19 Feb20 May20 #£Aug20 Nov 20 Source: Zoopla Research 7-day rolling, yoy change, ex new homes and overseas .. tH
Slide 9: Housing Market Activity
Housing Market Activity New Instructions Strong & Sustained Demand ili 2020 Daily 2019 (Week Avg) == 2020 (Week Avg) 2019 —2020 :
Slide 10: Housing Market Activity
Housing Market Activity Sales Pipeline No. properties Record pipeline still growing by the day Buyer Registrations — October 2020 vs 2019 First-time buyers Scotland / North * 18% Deadline looming for new Midlands A 26% sales to be agreed Pressure in the system, delays with Searches Conveyancing Lend
Slide 11: Chancellor’s summer statement
Chancellor’s summer statement Job Retention Kick Start Stamp Duty Help to Buy VAT Bonus Scheme • Threshold • No changes • £1,000 • Payments • Cut from 20% raised from announced payment for for new to 5% for £125,000 to furloughed employees hospitality £500,000 employees aged 18-24, sector from until
Slide 12: Help to Buy
Help to Buy The future of Help to Buy 1 In its current form the scheme ends in April 2021 2 A “new” scheme will operate for 2 years until March 2023 3 which will only be available to first time buyers 4 ….and subject to regional value caps Help to Buy 1 Help to Buy 2 2013 - 2021 April 2021 – March 2
Slide 13: UK Aircrete Market
UK Aircrete Market Aircrete Market Share 2020 • Market Size 2,000,000m3 H+H Forterra Tarmac Xella (imports) Other External Floors Walls Internal Foundations Walls
Slide 14: Market Fundamentals
Market Fundamentals
Slide 15: Market Fundamentals
Market Fundamentals Housebuilding market volumes are driven by various supply, demand and funding factors, which may be affected by relevant sub drivers. Driver Total population (inc. migration) Consumer confidence Demand for housing Housing transactions Housing deficit Land (availability & permissi
Slide 16: Market Fundamentals: Economic benefits of housing market activity
Market Fundamentals Economic benefits of housing market activity The important contribution that the housing market makes to the UK economy is widely acknowledged, yet assigning a value to that contribution is complex. There is no single source of data providing comprehensive information about the t
Slide 17: Trends in the Market
Trends in the Market Challenges and Opportunities
Slide 18: Trends in the Market: Challenges and Opportunities
Trends in the Market g Challenges and Opportunities • The impact of COVID-19 • Government support • Help to Buy • Stamp Duty • Planning Reform • Future Homes Standard • Modern Methods of Construction • Brexit • H+H Strategic opportunities
Slide 19: Trends in the Market: Challenges and Opportunities
Trends in the Market g Challenges and Opportunities • The impact of COVID-19 • Government support • Help to Buy • Stamp Duty • Planning Reform • Future Homes Standard • Modern Methods of Construction • Brexit • H+H Strategic opportunities
Slide 20: The impact of COVID-19
The impact of COVID-19 How have buyers’ preferences changed? Net balance of opinion on commitment to ry move in the next year 32% 0 0 56% 62% 7 more inclined to work from said the amount of garden or home more regularly in the outside space had become future (49% in April) more important 9% 0 > (i)
Slide 21: The impact of COVID-19
The impact of COVID-19 Houses sell faster than flats as priorities change Zoopla 60 m2019 m2020 50 as 48 is 41 42 41 ‘4 36 36 32 31 32 30 2% °4 29 Y > & a 20 10 1 bed 2 bed 3 bed 2 bed 3 bed 4 bed 5 bed flat flat flat house house —_ house house Time to sell for homes sold since 13/5/20 Source: Zoopl
Slide 22: Covid-19 Continues to influence the mix of Houses vs Flats
Covid-19 Continues to influence the mix of Houses vs Flats
Slide 23: Coronavirus: Rural markets boom as Brits flock to countryside
Coronavirus: Rural markets boom as Brits flock to countryside • Rural markets are booming as COVID-19 drives UK homebuyers to the countryside, with many happy to pay premium prices. • Rural locations have hit a new level of popularity among home buyers, according to Zoopla. • The rural district of R
Slide 24: The impact of COVID-19
The impact of COVID-19 • Increase in home improvement sector (RMI) • Garage conversions +31% • Loft conversions +19% • Detached home offices +16% • Home extension +12% • Basement conversion +9% (Sept 20 vs Sept 19) • Increase in enquiries for Garden rooms
Slide 25: Trends in the Market: Challenges and Opportunities
Trends in the Market g Challenges and Opportunities • The impact of COVID-19 • Government support • Help to Buy • Stamp Duty • Planning Reform • Future Homes Standard • Modern Methods of Construction • Brexit • H+H Strategic opportunities
Slide 26: Chancellor’s summer statement
Chancellor’s summer statement Job Retention Kick Start Stamp Duty Help to Buy VAT Bonus Scheme • Threshold • No changes • £1,000 • Payments • Cut from 20% raised from announced payment for for new to 5% for £125,000 to furloughed employees hospitality £500,000 employees aged 18-24, sector from until
Slide 27: Help to Buy
Help to Buy The future of Help to Buy 1 In its current form the scheme ends in April 2021 2 A “new” scheme will operate for 2 years until March 2023 3 which will only be available to first time buyers 4 ….and subject to regional value caps Help to Buy 1 Help to Buy 2 2013 - 2021 April 2021 – March 2
Slide 28: Future Homes Standard
Future Homes Standard • As part of the journey to 2050 Government is committed to introducing the Future Homes Standard by 2025. (This target will require the UK to bring all greenhouse gas emissions to net zero by 2050) • It is expected that an average home built to this standard will have 75-80% l
Slide 29: Changes to Part L anticipated in 2021
Changes to Part L anticipated in 2021 Making a significant interim step towards the Future Homes Standard through: • Uplifting the minimum standard of whole building energy performance • Improving the minimum insulation standards • Future-proofing new dwellings to be ready for low carbon heating sys
Slide 30: Trends in the Market: Challenges and Opportunities
Trends in the Market g Challenges and Opportunities • The impact of COVID-19 • Government support • Help to Buy • Stamp Duty • Planning Reform • Future Homes Standard • Modern Methods of Construction • Brexit • H+H Strategic opportunities
Slide 31: Modern Methods of Construction (MMC)
Modern Methods of Construction (MMC) • 7 Categories within the definition of the MMC • H+H have 2 systems approved • Large format block (Elements) • Thin joint Site Based MMC- includes H+H thin joint aircrete masonry and Elements
Slide 32: Trends in the Market: Challenges and Opportunities
Trends in the Market g Challenges and Opportunities • The impact of COVID-19 • Government support • Help to Buy • Stamp Duty • Planning Reform • Future Homes Standard • Modern Methods of Construction • Brexit • H+H Strategic opportunities
Slide 33: Brexit
Brexit • Deal or No Deal • Impact on Consumer Confidence • H+H Impact • 95% of our raw materials are UK sourced • Aluminium and Packaging • Holding 6 months stock across UK sites • Packaging can be sourced in UK if needed • Customer (Housebuilder) impact • Increase of 1½% in material costs • Sanitar
Slide 34: Trends in the Market: Challenges and Opportunities
Trends in the Market g Challenges and Opportunities • The impact of COVID-19 • Government support • Help to Buy • Stamp Duty • Planning Reform • Future Homes Standard • Modern Methods of Construction • Brexit • H+H Strategic opportunities
Slide 35: H+H Strategic opportunities
H+H Strategic opportunities • Refresh H+H Sales and Marketing approach
Slide 36: H+H Strategic opportunities: H+H UK
H+H Strategic opportunities H+H UK • Aggregate supply • PFA and Sand • Capacity expansion • 4 from 3 • Continuous improvement (CI) • Environmental / Sustainability
Slide 37: How do the Government achieve their 300k homes per annum target?
How do the Government achieve their 300k homes per annum target?
Slide 38: How do the Government achieve their 300k homes per annum target?
How do the Government achieve their 300k homes per annum target? • Planning in place to allow for 300k new homes • Increase land available with planning permission • System to deliver 300k • LA plans in place robust enough to deliver 300k • Stand ‘delivery test’ • Broader number of sites to allow bo
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