Nexity Sa · EURONEXT:NXI
Nexity Sa — H1 2005 Earnings Presentation
54 slides from Nexity Sa's earnings presentation, Sep 30, 2005
Slide 1: H1 2005 Results
H1 2005 Results September 30, 2005
Slide 2: Summary
Summary 1. H1 2005 highlights 2. H1 2005 financial results using IFRS 3. Commercial activity by division 4. Outlook 2
Slide 3: H1 2005 highlights
H1 2005 highlights
Slide 4: Leadership confirmed in H1 2005
Leadership confirmed in H1 2005 A 7.1% market share in residential real estate in H1 2005 Portfolio of around 1 million m² commercial real estate under development 2.4 million m² of offices and 17,500 housing units under management in the Services Division Breakdown of H1 2005 revenues - IFRS
Slide 5: H1 2005 highlights
H1 2005 highlights Revenues up by 13.3% on a comparable basis (+19.1% in total revenues) Accelerated growth in operating margin* to 13.8% (+2.4 pts) Net profit of €54m excl. Eurobarajas (+52%), and of €74m incl. Eurobarajas (+109%) Sustained commercial activity in all businesses A 31% incr
Slide 6: Increase in free-float
Increase in free-float Exit of private equity shareholders in April 2005 29,858,998 total shares in circulation Market capitalization of over €1 billion Management & employees 18% Caisse des Dépôts 10% 72% Free-float et Consignations 6
Slide 7: Share price performance since January 1, 2005
Share price performance since January 1, 2005 Performance relative to SBF120 of 15% +34% €35.50 Base 100 at January 3, 2005 130 110 Source: Euronext €26.45 SBF120 90 Jan-05 Feb-05 Mar-05 Apr-05 May-05 Jun-05 Jul-05 Aug-05 Sep-05 SBF SBF120 120(Base (Base100 100auat3 Jan. Janv.3,2005) 2005) Nexity Ne
Slide 8: H1 2005 financial results - IFRS
H1 2005 financial results - IFRS
Slide 9: IFRS transition timetable
IFRS transition timetable Directly under IFRS Comparative IFRS First Consolidated Reporting Period Financial Statements First interim financial Last French GAAP consolidated statements prepared financial statements (99-02) directly under IFRS H1 First-time adoption of IFRS Q1 Revenues 9M and subsequ
Slide 10: Positive impact of the transition to IFRS
Positive impact of the transition to IFRS Increase in operating margin of about 1 point No capitalisation of interest on project–related debt Correlative decrease in financial profit Increase in net profit Cancellation of goodwill amortization (+€15m/yr) – impairment test Share-based payment: €2
Slide 11: Limited effect of transition to IFRS in 2004
Limited effect of transition to IFRS in 2004 2004 2004 IFRS/99-02 Profit & loss (€m) 99-02 IFRS Revenues 1,361* 1,362* +0% Operating profit 158 154 (2%) Operating margin excl. Eurobarajas 11.6% 11.8% +20bp Net profit Group share 74 81 +8% Backlog at 31 December (€m) 1,753 1,839 +5% Balance sheet at
Slide 12: Growth in revenues
Growth in revenues H1 2005 revenues in €m - IFRS 756 635 710(1) 750 32 627(1) +13%11 126 ** 600 31 97 * +18% +18% 450 300 598 507 150 0 *incl. €27m for Eurobarajas **incl. €46m for Eurobarajas (1) Based on a comparable basis, H1 2004 H1 2005 including Saggel & Parcoval and excluding Eurobarajas Resi
Slide 13: Accelerated increase in operating margin in H1 2005
Accelerated increase in operating margin in H1 2005 Operating margin in % - IFRS Operating profit in €m - IFRS 15.3% 12.6% Residential 129 12.3% 98 5 +42% +42% 5 40 69 9 2 4 1 13.8% Group 11.8% 92 92 11.4% Exc. Eurobarajas 62 -8 -8 Excl. Eurobajaras Excl. Incl. Eurobarajas Incl. Eurobarajas Eurobara
Slide 14: Strong increase in net profit
Strong increase in net profit €m IFRS H1 2004 H1 2005 Revenues 635 756 +19% Operating profit(1) 69 129 +87% Operating margin 10.9% 17.0% excl. Eurobarajas 11.4% 13.8% +2.4bp Net financial expenses (9) (6) - Corporate taxes (21) (43) - Net profit 39 80 - Minority interests (4) (6) - Net profit Group
Slide 15: Increase of WCR from a low point at end 2004
Increase of WCR from a low point at end 2004 Working Capital Requirement in €m - IFRS 279 179 28%* of sales 97 13%* 13%* of sales of sales 2003 2004 H1 2005 * % of residential real estate revenues ** real estate portfolio, Villes & Projets and corporate tax Residential Commercial Services Others** r
Slide 16: Cash mainly used to reimburse debt
Cash mainly used to reimburse debt H1 2005 H1 2005 In €m restated* Cash flow after interest and taxes +80 +80 Changes in WCR excluding taxes** -59 -23 Changes in taxes WCR and others -20 +6 Free cash flow 1 63 Net cash from real estate portfolio +15 and other investment activities Dividends payment
Slide 17: Gearing maintained at low level
Gearing maintained at low level 2004 H1 05 2004 H1 05 ASSETS (€m) LIABILITIES (€m) Goodwill 274 274 Shareholders’ equity 280 326 Other assets 92 77 Minority interests 14 13 Total non current Assets 366 351 Total Equity 294 339 WCR 97 179 Provisions 62 60 Net debt 107 131 TOTAL ASSETS 463 530 TOTAL L
Slide 18: Residential Real Estate
Residential Real Estate
Slide 19: Nexity-TNS Sofres poll
Nexity-TNS Sofres poll Importance of housing in 2007 elections 29% Housing is not a priority for the French Government 57% Policies adopted by the French Government are inefficient 81% It is difficult to find a home 87% 0% 20% 40% 60% 80% 100% In the run-up to the 2007 elections, housing and urban
Slide 20: Demand in France remains strong in H1 2005
Demand in France remains strong in H12005 Reservations, commercial offer and price of new housing units Price of new apartments +11% yoy Number of reservations +6% yoy Commercial offer 4.3 months 2 700 110 000 2 500 EUR per m² 90 000 2 300 Number of units 2 100 70 000 1 900 50 000 1 700 30 000 1 500
Slide 21: Continued growth in commercial activity
Continued growth in commercial activity New homes reserved (units) Plots reserved (units) 4,399 4,057 +8% 1,107 1,082 56% +2% 61% 83% 80% 44% 39% 20% 17% H1 2004 H1 2005 H1 2004 H1 2005 Paris region Regions Residential Real Estate 21
Slide 22: Growth in activity driven by volume and prices
Growth in activity driven by volume and prices Volume in number of units reserved Avg price per product* (in thousand €) +7% 0 5,506 5,139 +8% 0 198.5 183.3 4,057 4,399 74 76 1,082 1,107 H1 2004 H1 2005 H1 2004 H1 2005 * excluding new homes sold to institutional investors New Homes Plots of land Res
Slide 23: A well-diversified customer base for new homes
A well-diversified customer base for new homes Average customer profile H1 2005 Breakdown of customer base 4,399 4,057 +8% +8% o/w first-time 960 1,025 buyers Age 43 years +7% +7% 4% 7% Annual profit €62,350 Average area 64 m² (-3%) 45% 42% Average budget €198,530 (+8%) Average price/m² €3,085 (+11%
Slide 24: Examples of residential programs commercialised in H1 2005
Examples of residential programs commercialised in H1 2005 Cannes (Côte d'Azur - 06) - "Royal Palm" George V Start of commercialisation: Nov. 2004 Total number of lots: 148 Number of lots reserved: 107 o/w 93 over 12 mths 53% of clients are from north of Europe Price / m²: €7,000 Lyon (69) - "Berthe
Slide 25: Offers designed for first-time buyers
Offers designed for first-time buyers Saint Ouen (Paris region, 93) "Camille Claudel" - Nexity-Féréal Start of commercialisation: April 2005 Total number of lots: 66 Number of lots reserved: 66 Price / m²: €3,060 Puteaux (Paris region, 92) Le clos de l’arche – Nexity-Seeri Start of commercialisation
Slide 26: Leadership in France with a 7.1% market share for new homes
Leadership in France with a 7.1% market share for new homes French market in H1 2005(1) Nexity market shares H1 2005 (In number of reservations) Paris region 12,306 (+6%) 15.1% West 10,763 (+11%) 7.1% 4.9% North East 7,854 (+29%) South West 11,379 (+5%) 3.0% 5.1% South East 19,537 (-2%) Rhône Alpes
Slide 27: Commercial offer at June 30, 2005
Commercial offer at June 30, 2005 Plots of land Regions New Homes Paris region 8,003 8,003 202 1,831 202 66 64% 69% 6,172 136 31% 36% Nber of programs Nber of units Nber of programs Nber of units At June 30, 2005 At June 30, 2005 Residential Real Estate 27
Slide 28: Commercial Real Estate
Commercial Real Estate
Slide 29: Continued renewal of order book
Continued renewal of order book Commercial activity in H1 2005 Warehouses, distribution centers High rise New and retail In square meters buildings buildings facilities Total Deliveries - 88,715 26,090 114,805 New orders - 16,690 63,124 79,814 Start of construction 69,013 53,695 51,915 174,623 Comme
Slide 30: Deliveries in H1 2005
Deliveries in H1 2005 "Eurocrystal" Saint-Ouen (93) Offices: 22,000 m² (MOD) Nexity-Entreprises Eurobarajas - Las Mercedes - Madrid Offices: 80,000 m² Nexity-Spain Commercial Real Estate 30
Slide 31: New orders in H1 2005
New orders in H1 2005 Olympe "Stade de France" – St Denis (93) Offices: 16,700 m² Nexity-Entreprises L'Îsle d'Abeau – Lyon (69) Logistics park: 25,000 m² Nexity-Geprim Commercial Real Estate 31
Slide 32: Main on-going commercial operations
Main on-going commercial operations* Office buildings (m²) Warehouses (m²) Total: 180,500 m² Total: 158,000 m² 10 programs 5 programs 25,800 27,300 119,000 34,200 68,200 66,000 Total of 338,500 m² and 15 programs * Based on programs > 5,000 m² Paris region Regions International Commercial Real Estat
Slide 33: Nexity International: a targeted presence in Europe
Nexity International: a targeted presence in Europe Nexity Portugal – Nexity Belgium - Brussels Lisbon Offices, hotels Offices & retail Residential under study facilities under study Nexity Italy - Milan A first project Nexity España - Madrid Biandrate Logistics park: 64,000 m² Offices & retail faci
Slide 34: Services
nexity UNE VILLE D’AVANCE Services
Slide 35: An emerging position in real estate services
An emerging position in real estate services Current portfolio Residential real estate management • 17,500 units for institutional and private investors Commercial real estate management • 2.4 million sq. m managed for institutional investors (AXA, MAAF) and private groups (SITQ, Morgan Stanley,MA
Slide 36: Villes & Projets
"Villes & Projets"
Slide 37: Villes & Projets: a unique position for the long-term
“Villes & Projets” : a unique position for the long-term St-Ouen: 300,000* m² Ermont Eaubonne: 80,000* m² Pré St-Gervais: 17,000* m² * approx. Gennevilliers: 200,000* m² Boulogne: 170,000* m² Versailles: 53,000* m² "Villes et Projets" 37
Slide 38: The Villes & Projets portfolio
The ‘‘Villes & Projets’’ portfolio Other Commercia- Residential Commercial commercial Total m² Status lisation* Renault 140,000 30,000 170,000 Definitive local In 2006 Boulogne** zoning plan (PLU) Cœur de Seine 50,000 100,000 150,000 Building permit In 2005 Gennevilliers to 75,000 to 125,000 to 200,
Slide 39: Outlook
mest UNE VILLE D’A Outlook
Slide 40: Reinforced visibility
Reinforced visibility Backlog(1) en €m - IFRS Months of activity(2) 14.2 mths (3) 16.5 mths in residential division 15.4 mths (3) 18.0 mths 2,035 +31% 340 1,558 0 Commercial 248 +18% +18% Residential 1,695 1,310 June 30, 2004 June 30, 2005 (1) Backlog (M€ excl. VAT) = reservations not yet included i
Slide 41: Significant land reserves at June 30, 2005
Significant land reserves(2) at June 30, 2005 Business potential in number of units Number of years of activity(1) 2.8 years 2.8 years 26,686 28,508 +7% 0 Plots of land 10,046 9,556 New Homes 18,462 17,130 June 30, 2004 June 30, 2005 (1) Based on reservations over last 12 months (2) Excl. land under
Slide 42: Financial guidance
Financial guidance Revenue growth (excl. acquisitions & Eurobarajas) 2005: above 10% 2006: above 15% Medium term: 7-10% p.a. on average Overall operating margin (excl. Eurobarajas) 2005 & 2006: above 13% 10-11% over the longer term (normalized margins) Gearing 2005 & 2006: under 50% (excl. acq
Slide 43: Extensive real estate expertise to map the city of tomorrow
Extensive real estate expertise to map THE CITY OF TOMORROW 43
Slide 44: Appendices
mest UNE VILLE D’A Appendices
Slide 45: A global offer under a unique brand name
A global offer under a unique brand name Residential Commercial Services Appendices 45
Slide 46: Densification of territorial coverage
Densification of territorial coverage Coverage of France at June 30, 2005 Lille Rouen Metz Amiens Present in 41 towns Strasbourg via 58 offices Dinan Caen 5 Brest Paris region Nancy Chartres Rennes Mulhouse Orléans Nantes Lorient Tours 21 new towns Dijon since 2000 Poitiers Lyon Annecy Clermont Vale
Slide 47: Efficient risk management
Efficient risk management Local responsibilities Central responsibilities Operating subsidiaries Centralized risk Land development management: Sharing of Engagement Project definition, expertise Committee based on local specificities Reporting Marketing Management and production and allo
Slide 48: A seasoned management team
A seasoned management team The Executive Committee 9 Significant experience Alain Dinin 9 A strong financial culture rooted in our history Hervé Denize Guy de Boisgrollier Martine Carette Laurent Diot Emmanuel Deloge Anne Lalou Jean-Paul Maquignon Jean-Pierre Mingeonnet Jean-Luc Poidevin Catherine S
Slide 49: Favourable demographic factors
Favourable demographic factors Increasing number of High birth rate Longer life expectancy single-parent households Life expectancy at birth Average number of Birth rate (per 1,000) (years) individuals per household 12.6 12.8 77.7 79.4 10.4 10.4 2.57 2.41 2.27 1995 2002 1994 2003(e) 1990 1999 2010(e
Slide 50: A strategy in line with French migration trends
A strategy in line with French migration trends Net migrations from 1999 to 2004* Strong migration to South-West regions of France in the last 5 years. 107 110 70 62 62 54 49 47 33 28 30 25 23 22 -10 -3 -10 -11 -20 -21 -28 -31 -50 -35 -47 -57 -68 -90 Franche-Comté Haute Normandie Nord-Pas-de-Calai
Slide 51: Recurring tax incentives for private investors
Recurring tax incentives for private investors Breakdown of reservations by type of customer 100% 41% 45% 45% 51% 47% 48% 48% 51% 63% 59% 68% 50% 59% 55% 55% 49% 53% 52% 52% 49% 37% 41% 32% 0% 1996 1997 1998 1999 2000 2001 2002 2003 2004 H1 10YR 2005 avg Private investors Owners Perissol Act 01/1996
Slide 52: Paris region remains one of the most attractive real estate investment opportunities in Europe
Paris region remains one of the most attractive real estate investment opportunities in Europe Office vacancy in Europe (end H1 2005) London West End Paris Ile de France Milan Madrid London City Frankfurt Am sterdam 5% 7% 9% 11% 13% 15% Source: CBRE Bourdais Appendices 52
Slide 53: Paris region remains one of the most attractive real estate investment opportunities in Europe
Paris region remains one of the most attractive real estate investment opportunities in Europe Office take-up in Paris Region 100% 90% 2,05 80% 70% 1,55 60% 50% 1,05 40% 30% 0,55 20% 10% 0,05 0% 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005E* FY take-up in million m² H1 take-up in million m² % o
Slide 54: Combining different time scales
Combining different time scales Business Short term Services Fast growing market Medium term Residential and Commercial Real Estate Good visibility Long term Long-term growth Urban regeneration (Villes & Projets) potential Time Appendices 54