Berkeley Group Holdings Plc · LSE:BKG
Berkeley — The Berkeley Group Holdings — H1 2022 Earnings Presentation
32 slides from Berkeley's earnings presentation, Dec 8, 2021
Slide 1: Interim Results Presentation
THE BERKELEY GROUP HOLDINGS PLC Interim Results Presentation SIX MONTHS ENDED 31 OCTOBER 2021 8th DECEMBER 2021
Slide 2: Interim Results Presentation: Introduction
Interim Results Presentation For the Six Months Ended 31 October 2021 Rob Perrins Chief Executive INTRODUCTION INTRODUCTION 1 Strong results with sales at pre-pandemic levels in a complex and volatile operating environment Richard Stearn Chief Financial Officer 2 Land holdings provide excellent visi
Slide 3: Richard Stearn, Chief Financial Officer
Richard Stearn Chief Financial Officer Oval Village 2
Slide 4: Introduction
Finance Review Introduction 1. SUMMARY OF PERFORMANCE 6. ABRIDGED BALANCE SHEET 2. SUMMARY OF FINANCIAL POSITION 7. INVENTORIES 3. HOMES COMPLETED AND AVERAGE SELLING PRICE 8. CREDITORS 4. INCOME STATEMENT 9. FINANCING 5. ABRIDGED CASH FLOW 10. LAND HOLDINGS 3
Slide 5: Summary of Performance
Finance Review Summary of Performance PROFIT BEFORE TAX CHANGE / CHANGE % 31 October 2021 31 October 2020 +£59.9m £290.7m £230.8m (+26.0%) OPERATING MARGIN 31 October 2021 31 October 2020 EPS - BASIC CHANGE / CHANGE % 22.2% 25.4% 31 October 2021 31 October 2020 [22.8% FY21] +52.1p 201.7p 149.6p (+34
Slide 6: Summary of Financial Position – Balance Sheet
Finance Review Summary of Financial Position – Balance Sheet SHAREHOLDERS’ FUNDS CHANGE / CHANGE % 31 October 2021 30 April 2021 -£251.3m £2,924.1m £3,175.4m (-7.9%) NET ASSET VALUE PER SHARE CHANGE / CHANGE % 31 October 2021 30 April 2021 -1p CLOSING NET CASH CHANGE / CHANGE % 2,611p 2,612p (-0.0%)
Slide 7: Summary of Financial Position – Forward Sales and Land Holdings
Finance Review Summary of Financial Position – Forward Sales and Land Holdings FORWARD SALES CASH DUE ON FORWARD SALES CHANGE / CHANGE % 31 October 2021 30 April 2021 -£9.3m £1,702.9m £1,712.2m (-0.5%) LAND HOLDINGS PLOTS CHANGE / CHANGE % 31 October 2021 30 April 2021 +32 63,302 63,270 (+0.0%) GROS
Slide 8: Homes Completed and Average Selling Price (ASP) – Group
Finance Review Homes Completed and Average Selling Price (ASP) – Group Homes ASP H1 1,828 H1 £647k 2021/2022 H2 H2 FY FY H1 1,104 H1 £799k 2020/2021 H2 1,721 H2 £751k FY 2,825 FY £770k H1 1,389 H1 £644k 2019/2020 H2 1,334 H2 £711k FY 2,743 FY £677k H1 2,027 H1 £740k 2018/2019 H2 1,671 H2 £757k FY 3,
Slide 9: Homes Completed and ASP – Joint Ventures (St Edward & St William)
Finance Review Homes Completed and ASP – Joint Ventures (St Edward & St William) Homes ASP H1 395 H1 £558k 2021/2022 H2 H2 FY FY H1 145 H1 £782k 2020/2021 H2 284 H2 £628k FY 429 FY £680k St Edward & St William H1 212 H1 £805k 2019/2020 H2 223 H2 £645k FY 435 FY £723k H1 57 H1 £863k 2018/2019 H2 204
Slide 10: Income Statement
Finance Review Income Statement 31 OCTOBER 2021 31 OCTOBER 2020 CHANGE CHANGE SIX MONTHS ENDED £’m £’m £’m % Revenue 1,220.7 895.9 +324.8 +36.3% Gross profit 346.5 28.4% 289.2 32.3% +57.3 +19.8% Operating expenses (75.5) 6.2% (61.2) 6.8% -14.3 +23.4% Operating profit 271.0 22.2% 228.0 25.4% +43.0 +1
Slide 11: Abridged Cash Flow
Finance Review Abridged Cash Flow 31 OCTOBER 2021 31 OCTOBER 2020 SIX MONTHS ENDED £’m £’m Profit before tax 290.7 230.8 (Increase) / decrease in inventory (54.8) (329.4) (Decrease) / increase in customer deposits (13.1) 53.6 Other working capital movements 89.0 97.7 Net decrease / (increase) in wor
Slide 12: Abridged Balance Sheet
Finance Review Abridged Balance Sheet 31 OCTOBER 2021 CHANGE 30 APRIL 2021 AS AT £’m £’m £’m Non–current assets - Intangible assets 17.2 - 17.2 - Investment in joint ventures 333.1 +51.4 281.7 - Deferred tax assets 40.7 +0.6 40.1 - Right-of-use assets 2.8 -0.4 3.2 - Property, plant and equipment 42.
Slide 13: Inventories
Finance Review Inventories 31 OCTOBER 2021 CHANGE 30 APRIL 2021 AS AT £’m £’m £’m Land not under development 396.8 +65.4 331.4 Work-in-progress: Land cost 1,076.4 -58.3 1,134.7 Total land 1,473.2 +7.1 1,466.1 Work-in-progress: Build cost 2,080.6 -0.4 2,081.0 Completed units 156.2 +50.8 105.4 Total i
Slide 14: Creditors
Finance Review Creditors 31 OCTOBER 2021 CHANGE 30 APRIL 2021 AS AT £’m £’m £’m Trade creditors and accruals 875.8 +109.1 766.7 Provisions for liabilities 128.7 +0.6 128.1 Deposits and on account receipts 777.5 -13.1 790.6 Land creditors 367.5 -20.7 388.2 Lease liabilities 2.8 -0.4 3.2 Total liabili
Slide 15: Financing
Finance Review Financing Group St William £400m Green Bonds (2031) ▪ £400 million Green Bonds in issue ▪ £360 million RCF 2.50% coupon (until Aug 2031) ▪ Maturity March 2024 with an option to extend by a ▪ £750 million RCF (undrawn at 31 Oct 2021) further year Investment Grade ▪ Maturity November 20
Slide 16: Land Holdings
Finance Review Land Holdings AS AT 31 OCTOBER 2021 CHANGE 30 APRIL 2021 Owned 55,020 +2,940 52,080 Contract 8,282 -2,908 11,190 Plots 63,302 +32 63,270 Sales value £25.7bn +£0.2bn £25.5bn Average selling price (ASP)* £475k +£3k £472k Average plot cost £42k - £42k Land cost % 10.4% -0.1% 10.5% Gross
Slide 17: Rob Perrins, Chief Executive
Rob Perrins Chief Executive The Eight Gardens | Watford 16
Slide 18: Introduction
Strategic Review Introduction 1. BERKELEY’S UNIQUE LONG-TERM OPERATING MODEL 5. SITES – DELIVERY AND LAND STATUS 2. REGENERATION SITES IN THE LAND HOLDINGS 6. JOINT VENTURES 3. OUR VISION 2030: TRANSFORMING TOMORROW 7. CAPITAL ALLOCATION AND SURPLUS CAPITAL 4. OPERATING ENVIRONMENT 8. GUIDANCE 4a. S
Slide 19: Berkeley's Unique Long-term Operating Model
Strategic Review Berkeley’s Unique Long-term Operating Model Land-led, Value Added ▪ Acquire land selectively at the right time in the cycle, never compromising our disciplines ▪ Focus on transforming large-scale brownfield sites in deeply under- supplied London and South East markets ▪ Bespoke appr
Slide 20: Regeneration at Scale: Sites in the Land Holdings
Strategic Review Regeneration at Scale: Sites in the Land Holdings In production Future sites Berkeley is 1. 250 City Road, Islington 1. Aylesham Centre, Peckham* 2. Beaufort Park, Hendon 2. Borough Triangle delivering 3. Bermondsey Place, Southwark 3. Lombard Square, Plumstead 30 4. Camden Goods Ya
Slide 21: Our Vision 2030: Transforming Tomorrow
Strategic Review Our Vision 2030: Transforming Tomorrow Nature Recovery • 43 sites committed to net biodiversity gain • Creating around 500 acres of new or improved habitat Communities • Unique social value tool launched in the period • Quantifies and compares relative benefits of development featur
Slide 22: Operating Environment
Strategic Review Operating Environment Sales Performance Market ▪ Sales reservations slightly ahead of the two years ▪ London and South East are deeply under-supplied preceding the pandemic ▪ The 20% reduction in sales for 2020/21 financial year has markets: ➢ DLUHC new starts in London for the 12 m
Slide 23: Operating Environment (continued): Land Planning
Strategic Review Operating Environment (continued) Land Planning ▪ Two new developments added to the land holdings in ▪ One new major planning consent obtained in the period at London, covering 1,500 new homes. Includes: St William’s site in Leyton (570 homes) Berkeley has no significant ➢ Unconditi
Slide 24: Operating Environment (continued): Construction, Berkeley Modular
Strategic Review Operating Environment (continued) Construction Berkeley Modular ▪ Build cost rises of around 5% per annum, centred on materials ▪ Live production commenced (for Kidbrooke Village) ▪ Gradual easing of the supply issues for most materials with lead times stabilising ▪ Longer-term obje
Slide 25: Sites - Delivery and Land Status
Strategic Review Sites - Delivery and Land Status REGENERATION OTHER TOTAL LONDON AS AT 31 OCTOBER 2021 OUT OF LONDON SITES SITES SITES LAND HOLDINGS SITES Delivery of Developments: In construction 25 83% 39 61% 64 68% 31 67% 33 69% Not yet in construction – owned 4 13% 12 19% 16 17% 6 13% 10 21% No
Slide 26: Sites - London
Strategic Review Sites - London London In Production London Future Key 1. 250 City Road, Islington 1. Aylesham Centre, Peckham* In Production 2. 9 Millbank, Westminster 2. Bethnal Green Future 3. Battersea Reach 3. Borough Triangle 4. Beaufort Park, Hendon 4. Bow Common Regeneration site 5. Bermonds
Slide 27: Sites - outside of London
Strategic Review Sites - outside of London Out of London In Production Out of London Future Key 1. Abbey Barn Park, High Wycombe 1. Bath In Production 2. Ascot Gas Works 2. Bracknell Future 3. Bersted Park 3. Brighton Gas Works 4. Broadacres, Southwater 4. Effingham Regeneration site 5. Courtyard Ga
Slide 28: Joint Ventures: St Edward
Strategic Review Joint Ventures St Edward Hartland Village | Fleet Joint venture with Land holdings of Five sites in One site in M&G 5,030 homes production planning (with a resolution) 27
Slide 29: Joint Ventures: St William
Strategic Review Joint Ventures St William Kings Road Park | Fulham Joint venture with Land holdings of Sunninghill Bank facilities National Grid 12,814 homes moved into of £360 million production in the period 28
Slide 30: Capital Allocation and Surplus Capital
Strategic Review Capital Allocation and Surplus Capital Financial Strength & Visibility Capital Allocation and Surplus Capital ▪ Balance Sheet ▪ Berkeley has acquired or identified the land to meet its 2025 target of having £7.5 billion of future gross margin in land holdings Net Cash Net Assets ▪ C
Slide 31: Guidance
Strategic Review Guidance - Pre-tax earnings expectations for the current year ending 30 April 2022 raised by around 5% from previous guidance (£518 million) - For the following three financial years expect pre-tax earnings growth of 5% per annum Profit Guidance: - Berkeley therefore anticipates del
Slide 32: Questions
Interim Results Presentation for the six months ended 31 October 2021 Questions Rob Perrins Chief Executive Richard Stearn Chief Financial Officer Horlicks Quarter | Slough
The Berkeley Group Holdings — H1 2022 Earnings Presentation on 6ix