Kaufman & Broad Sa · EURONEXT:KOF
Kaufman & Broad Sa — H1 2024 Earnings Presentation
41 slides from Kaufman & Broad Sa's earnings presentation, Jul 12, 2024
Slide 1: 1st Half-year results and outlook 2024
2024 1st Half-year results and outlook 2024, July 12th
Slide 2: Solid development momentum in the medium term
SOLID DEVELOPMENT MOMENTUM IN THE MEDIUM TERM > Land portfolio Logement > Accommodation (Number of lots) (Number) (€ m value including tax) 34,864 3,635 34,694 872.0 33,003 2,238 2,400 561.2 503.2 End End End End End H1 H1 H1 H1 H1 H1 H1 H1 H1 H1 May May May May May 2020 2021 2021 2023 2024 2020 202
Slide 3: The housing market
The housing market A KAUFMAN = BROAD
Slide 4: Contraction between higher residential property prices and higher interest rates
CONTRACTION BETWEEN HIGHER RESIDENTIAL PROPERTY PRICES AND HIGHER INTEREST RATES (DATA ON 26 COUNTRIES) ▪ Residential property prices vs. long term interest rates Long term Price interest rate index * * * - 175 5% 4% - 150 3% - 2% 125 1% 100 0% -75 2000 2005 2010 2015 2020 2024 * Source: OECD, Euro
Slide 5: Residential housing market: a key need
▪ RESIDENTIAL HOUSING MARKET: A KEY NEED * ▪ The almost 4 point increase in interest rates since 2021 should have led to a decline in nominal prices of 30 to 50% ▪ On the contrary, they limited their decline before resuming their progression ▪ Several reasons for this: ▪ Protective reference for lon
Slide 6: Reasonable rates that are not a brake on home ownership
REASONABLE RATES THAT ARE NOT A BRAKE ON HOME OWNERSHIP Housing mortgage rates (rn%) - All markets Number of bank loans granted (Crédit Logement) Base 100 in 2020, year on year levels % Number of loans 5 - 125 150 4 - 125 3.92% 3.73% 3 100 2 50.4 -75 1 50 Q1 Q3 Q3 Q3 May 2012 2015 2018 2021 2024 * S
Slide 7: Changes in construction authorisations and reservations
CHANGES IN CONSTRUCTION AUTHORISATIONS AND RESERVATIONS LOGEMENTS Source: Sdes, Sit @ del2, In raw data - excluding pure individual data (Dido) 2024 (*): 12 months at end May 24 Presentation of results for the first 1half of 2024 7
Slide 8: Demand for new housing driven by single person households
DEMAND FOR NEW HOUSING DRIVEN BY THE INCREASE IN THE NUMBER OF SINGLE PERSON HOUSEHOLDS BY 2030 AND 2050 ▪ Breakdown of households by size In (Metropolitan France) ▪ Increase of 3.6 million households between millions 2020 and 2050, driven by the increase of 14. single person households (+3.4 millio
Slide 9: Parallel drop in prices and transactions in the old increases pressure on new homes
THE PARALLEL DROP IN PRICES AND TRANSACTIONS IN THE OLD ONE INCREASES PRESSURE ON NEW HOMES ▪ Older house prices ▪ Number of existing house transactions (quarterly% change, Q/Q-1, SA) (thousands of housing units cumulated over one year) Source: Noters - Insee, index of existing house prices Source:
Slide 10: Housing Activity
Housing Activity A KAUFMAN = BROAD
Slide 11: Reservations: market vs. Kaufman & Broad 2020-2024
RESERVATIONS: MARKET VS. KAUFMAN & BROAD 2020 - 2024 ▪ Change in net orders over 12 months (in number) 10,0% 4,9% -5,5% -15,3% -16,5% -17,5% -25,9% -31,7% -32,8% -36,8% -38,5% -39,6% Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024 vs. Q1 vs. Q2 vs. Q3 vs. Q4 vs. Q1 vs. Q2 2022 2022 2022 2022 2023 20
Slide 12: Change in construction authorisations
CHANGE IN CONSTRUCTION AUTHORISATIONS ▪ Total number of w/o pur individual single homes Building permits obtained Market vs Kaufman & Broad 120 Half-year - (Basis 100 2022) 100 80 60 40 20 0 S1 2020 S1 2021 S1 2022 S1 2023 S1 2024 Market Kaufman & Broad Presentation of results for the first 1half of
Slide 13: Change in construction authorisations
CHANGE IN CONSTRUCTION AUTHORISATIONS ▪ Change in the number w/o pur individual single homes Vs building permits obtained compared with the semester of the previous year (Base 100 2022) 30% 27% 27% 25% 20% 10% 0% S1 2022 H1 2022 H1S1 2023 H1S1 2024 -10% -12% -20% -21% -24% -30% K&B Marché Market Kau
Slide 14: Orders and commercial offer: market vs. Kaufman & Broad
ORDERS AND COMMERCIAL OFFER: MARKET VS. KAUFMAN & BROAD ▪ Market ▪ Kaufman & Broad +19% -14% 120,000 2,780 116,000 114,000 2,525 2,618 110,000 104,000 2,400 96,000 2,265 -2,238 -55% 1,876 -13% 62,000 54,300 1,626 H1 2021 H1 2021 H1 2023 H1 2024 (*) H1 2021 H1 2021 H1 2023 H1 2024 Orders in volume Or
Slide 15: Sustained rate of sales
SUSTAINED RATE OF SALES ▪ Take-up rate * - months Market average (Source ECLN) Kaufman & Broad 26.0 (1) 19.2 12.2 10.0 9.0 7.0 5.4 4.1 4.0 3.1 H1 2020 H1 2021 H1 2022 H1 2023 H1 2024 * For 6 months, commercial offer end of period/Average reservations of the period (1) Kaufman & Broad estimated data
Slide 16: Housing orders: trend for customer breakdown
HOUSING ORDERS: TREND FOR CUSTOMER BREAKDOWN > H1 2023 > H1 2024 By volume 5% 5% 6% 18% 9% < 10% 2,238 2,400 lots lots 76% 71% In Value 5% 5% 7% 6% 23% 18% €503.2M €561.2M 70% 66% Investors Pinel scheme First and second Blocks Excluding the Pinel scheme time buyers Presentation of results for the fi
Slide 17: Development of the housing land portfolio
DEVELOPMENT OF THE HOUSING LAND PORTFOLIO > Housing land portfolio - Number of lots 34,864 35,001 35,037 34,694 32,109 33,003 28,035 End May End May End May End May End May End May End May 2018 2019 2020 2021 * 2022 2023 2024 ▪ Land reserve at the end of May 2024: ▪ > 6 years of activity ▪ 89 % (in
Slide 18: Housing backlog of almost 30 months' activity
HOUSING BACKLOG OF ALMOST 30 MONTHS' ACTIVITY > Backlog Housing, € m excl. VAT (Number of months of activity) 2,464 2,026 2,290 2,326 1,785 2,149 2,090 (27.1) (28.3) (24.3) (26.1) (22.8) (18.8) (16.7) End May End May End May End May End May End May End May 2018 2019 2020 2021 * 2022 2023 2024 Presen
Slide 19: Long-term housing backlog dynamics
LONG-TERM HOUSING BACKLOG DYNAMICS > Sequential quarterly change in Housing Backlog +3.4% +2.4% -0.5% -2.6% -3.4% -4.4% -14.8% (Q4 2022) Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Vs Vs Vs Vs Vs Vs Vs Q3 2022 (Q4 2022) Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Presentation of results for the firs
Slide 20: Development of a portfolio of managed residences
Development of a portfolio of managed residences as an developer-investor- operator
Slide 21: The relevance of our model demonstrated by the results
THE RELEVANCE OF OUR MODEL DEMONSTRATED BY THE RESULTS ▪ Investments compatible with balance sheet resources Business model overview ▪ Compliance with our profitability, cash generation and distribution policy ▪ Sale/rotation of residences as of the 5th year Results after 2.5 years of Amiens ▪ Inves
Slide 22: Partnership with Banque des Territoires
PARTNERSHIP WITH BANQUE DES TERRITOIRES : SENIOR RESIDENCES IN 2021, STUDENT RESIDENCES IN 2024 Operation 51% 49% Operation October 2021 May 2024 2 Senior residents to date: 3 Student residences to date: Besançon and Franconville Gagny, Amiens, Reims en VEFA ▪ Priority Objective: Cities where the su
Slide 23: Timing of commissioning of managed residences
TIMING OF ACTUAL OR PLANNED COMMISSIONING OF MANAGED RESIDENCES ACQUIRED AND OPERATED Volumes by number of beds Students Senior Franconville 100 Amiens 143 Besançon -125 Reims Gagny 310 159 2021 2022 2023 2024 2025 2026 2027 Presentation of results for the first 1half of 2024 23
Slide 24: Investment cadencement
INVESTMENT CADENCEMENT > Net investments in equity (Kaufman & Broad share) €27.3M €15.5M €27.2M €14.1M €17.4M €11.7M €3.3M €1.4M €9.8M €8.4M Total investments * at Achieved at Outstanding Investments 2023 November 30 end May Total 2024 Senior residences Student residences * Including Bank of Territo
Slide 25: Urban planning and renewal policy
Urban planning and renewal policy
Slide 26: Development projects under construction of industrial and commercial wastelands
DEVELOPMENT PROJECTS UNDER CONSTRUCTION OF INDUSTRIAL AND COMMERCIAL WASTELANDS Over 310,000 Sq.m of industrial and commercial wastelands representing over 3,000 housing Localisation Typology ▪ Reims ▪ O/w Education: o Néoma BS: 35,000 Sq.m Mixed: Region ▪ 680 lots o Esad: 10,000 Sq.m Tertiary and ▪
Slide 27: Business Property
Business Property A KAUFMAN = BROAD
Slide 28: Tertiary activity in the first six months
TERTIARY ACTIVITY IN THE FIRST SIX MONTHS OF THE EXERCISE €54.5M excl. VAT 21, €7M incl. VAT 583.4 M € excl. Revenue Orders VAT Backlog Vs EUR 381.0 m (excl. Vs EUR 24.5 m incl. Vs €665.1M excl. VAT) in H1 2023 VAT VAT at end May In H1 2023 2023 69,900 Sq.m 229,300 Sq.m 119,500 Sq.m In progress Curr
Slide 29: Austerlitz - a major construction site
AUSTERLITZ - A MAJOR CONSTRUCTION SITE FORECAST REVENUE RECOGNIZED USING THE PERCENTAGE-OF-COMPLETION METHOD 2023 2024 2025 2026 2027 Signature agreements Deliveries VEFA/CPI Actual cumulated Projected recognition of Revenues for: At 30/11/2023: Date 40% 11% 17% 19% 13% Cumul. 40% 51% 68% 87% 100 %
Slide 30: Financial performance
Financial performance A KAUFMAN = BROAD
Slide 31: Revenue
Revenue: €848.8M Housing (Apartment, homes, Housing Q3 managed residences) 54% €283.5M €452.5M €389.6M vs. €461.0M Housing 86% Commercial property Commercial (Offices, retail and logistics) property H1 45% €605.8M €54.4M vs. €381.0M Commercial property 1% * 12% 2% * Others (Showroom, Service residen
Slide 32: From revenue to operating profit
FROM REVENUE TO OPERATING PROFIT In thousands of euros 452.5 (355.0) 97.5 21.6% of (63.0) 34.5 sales 7.6% of sales Revenue Cost of Gross Current Income sales margin operating Current expenses income Presentation of results for the first 1half of 2024 32
Slide 33: Operating margin
OPERATING MARGIN > Current Operating Margin (In% of revenues) 8.0% 7.5% 7.6% 2022 2023 2024 Presentation of results for the first 1half of 2024 33
Slide 34: From operating profit to net profit
FROM OPERATING PROFIT TO NET PROFIT In thousands of euros 3.4 (6.6) 34.5 (5.8) 2.4 27.9 (6.8) 21.1 7.6% of sales 4.7% of sales Income Other non Net Cost of Income Share of profit Income Non-controlling Attributable current Financial Debt Taxes from equity Consolidated interests Current net income in
Slide 35: Change in working capital
CHANGE IN WORKING CAPITAL In thousands of euros (As% of revenues) 245.4 190.0 21.3% 177.0 150.1 122.1 116.9 113.7 14.2% 14.5% 10.2% 10.5% 8.4% 8.9% 24.7 1.6% -5.7% -80.8 -13.7% 138.9 Nov. 19 May 20 Nov.20 May 21 Nov 21 May 22 Nov 22 May 23 Nov 23 May 24 * Restatement taking into account the change i
Slide 36: Consolidated balance sheet at 31 May 2024
CONSOLIDATED BALANCE SHEET AT 31 MAY 2024 In thousands of euros Assets Liabilities 212.9 Shareholders' equity Non-current assets 273.6 146.5 Non-current liability Net cash (Excluding IFRS 16 and Put 224.9 Néorésid lease debt) Working Capital 138.9 Requirement 498.5 498.5 99.9 Presentation of results
Slide 37: Financial structure
FINANCIAL STRUCTURE In thousands of euros 31 May 2024 30 30 Nov 2023 Nov 2022 Shareholders' equity 212.9 234.5 257.8 Borrowings * 157.2 212.4 214.3 O/w financial debt < 1 year (excluding IFRS 16) 103.2 56.5 5.9 O/w financial debt > 1 year (excluding IFRS 16) - 1.0 113.2 166.6 O/w IFRS 16 and Put Néo
Slide 38: Maturity of gross financial debt
MATURITY OF GROSS FINANCIAL DEBT Due May €150.0M 2024 €50M Due May 2025 €100M Euro PP gross financial debt At 31 May 2024 (Excluding IFRS 16 and Put Neoresid) ▪ The maturity of the May 2024 bond issue was repaid in use of the company's cash ▪ Kaufman & Broad is rated ‘BBB-’ - Investment grade ▪ And
Slide 39: Outlook
Outlook A KAUFMAN = BROAD
Slide 40: Outlook
Outlook ▪ For the full year 2024: ▪ Group' revenue are expected to be around 1.1 billion euros, with the deviation from 2023 explained by the strong base effect from the Austerlitz deal, ▪ Underlying operating profit is expected to be between 7% and 7.5% ▪ The group should remain in a positive net c
Slide 41: Warning
WARNING Certain information contained in this document does not constitute historical data, but is forward looking. These forward looking statements are based on estimates, forecasts and assumptions in this included, in particular, assumptions regarding the present and future strategy of Kaufman & B