Merko Ehitus As · OMXTSE:MRK1T
Merko Ehitus As — Q2 2015 Earnings Presentation
18 slides from Merko Ehitus As's earnings presentation, August 2015
Slide 1: Merko Ehitus Group 6 months and Q2 2015 interim report
MERKO EHITUS GROUP 6 months and Q2 2015 interim report August 2015
Slide 2: Agenda
Agenda 1. Key highlights 2. Business review 3. Financial position 4. Market outlook 2 300 MW Estonia Power Plant of Eesti Energia
Slide 3: Merko group key highlights 6M 2015
Merko group key highlights 6M 2015 6M results in line with expectations and reflect the developments on the Baltic construction market started in 2014. Group profitability burdened by higher tax expense on dividends paid in Q2 and lower margin from some real estate development projects. Achiev
Slide 4: Merko group key financial highlights
Merko group key financial highlights 6M 6M Q2 Q2 EUR millions Variance Variance 2014 2015 2014 2015 2014 Revenue 116.2 113.7 +2.2% 70.6 64.8 -8.9% 252.3 Gross profit 8.9 10.1 -11.3% 5.4 6.1 -12.5% 24.7 Gross profit margin (%) 7.7 8.9 -13.2% 7.6 9.5 -19.6% 9.8 EBITDA 5.6 6.1 -9.3% 3.7 4.3 -13.6% 16.4
Slide 5: Revenues and gross profit 6M 2015
Revenues and gross profit 6M 2015 REVENUES Strong performance from real estate development (revenues up by 57.4% y-o-y), Latvian and Lithuanian construction service segment (up by 31.5%) . Revenues from our first electrical engineering project in Latvia. Decrease of Estonian construction servi
Slide 6: Revenues and gross profit Q2 2015
Revenues and gross profit Q2 2015 REVENUES Real estate development segment thriving as quarterly revenues are up by 107.0% y-o-y. Mainly related to sales of apartments in more exclusive developments. Latvian and Lithuanian construction service segment revenues increase (up by 24.0%) and Estonian
Slide 7: Real estate development - apartments
Real estate development - apartments Good reservation and conversion rate in the launched projects. Closely monitoring increased supply in Tallinn and Vilnius, to be prepared for longer sales periods. 57.4% increase of revenues compared to 6M 2014, however lower level of units (168 pcs compared to
Slide 8: Secured Order Book
Secured Order Book Secured order book 13.3% higher compared to same period last year at EUR 217.2m (30.06.2016: EUR 191.6m). Q2 2015 new contracts signed EUR 98.9m vs EUR 21.7m in Q2 2014. Major project for design and construction of shopping and entertainment centre T1 in Tallinn for EUR 70.0m
Slide 9: Financial position
Financial position Group’s liquidity position at a lower level, cash at EUR 24.4m (31.12.2014: EUR 51.6m) mainly due to investments in land, release of option and dividend payment in Q2 2015. The net debt amounted to EUR 10.7m and debt ratio at modest level of 15.6% (31.12.2014: EUR -13.9m and 1
Slide 10: Dividend and share capital reduction
Dividend and share capital reduction Dividend pay-out ratio according to long-term financial objectives: 50-70% of the annual profit. EUR 7.3 million dividends (EUR 0.41 per share) paid in Q2 2015. The registration of share capital reduction in the amount of EUR 4.1 million (EUR 0.23 per share
Slide 11: Stock Exchange overview
Stock Exchange overview Market Cap EUR 148.7m (30.06.2014: EUR 127.1m) +17.0% y-o-y No of % of total % of total Shareholders Variance shares 30.06.2015 31.03.2015 AS Riverito (management) 12 742 686 71,99% 71,99% - ING Luxembourg S.A. AIF Account 974 126 5,50% 5,50% - Firebird Republics Fund Ltd 395
Slide 12: Baltic construction market
Baltic construction market Source: local statistical services Source: local statistical services Marginal increase in construction prices, main impact due to labour force costs. No significant pressure on input prices expected as weak outlook for overall market growth during 2015. Confidence lev
Slide 13: Housing market in Baltics
Housing market in Baltics Source: Local statistical services Source: Eurostat Consumer confidence at a same level. Demand remains for good quality and optimal price level residential premises in all capital cities. Interest rates on mortgages remained on a low level, consumers accessing the fi
Slide 14: Outlook 2015-2016
Outlook 2015-2016 Orders not increasing and pricing competition tightening in Baltic construction market Focus for next year: private sector orders and apartment development + internal efficiency Private sector focus in general construction. Increased effort on design and built contracts with aim
Slide 15: Long term outlook
Long term outlook Long term outlook: the leading Baltic construction and development business Post 2015-2016 EU funds will support the increase in civil and public sector building orders. Strengthen our position as leading apartment developer in the Baltic. We develop modern and quality living e
Slide 16: Group in brief
Group in brief Estonian construction services Wide scope of (56% of revenue), Latvian and Share quoted on construction services: Lithuanian construction Nasdaq OMX services (26%), Real Estate • General construction Development (18%) Tallinn since 1997 • Engineering construction • Road construction •
Slide 17: Contacts
Contacts Andres Trink Signe Kukin Chief Executive Officer Chief Financial Officer E-mail: andres.trink@merko.ee E-mail: signe.kukin@merko.ee AS Merko Ehitus Delta Plaza, 7th floor Pärnu mnt. 141, 11314 Tallinn, Estonia Phone: +372 6501 250 group.merko.ee 17
Slide 18: Disclaimer
Disclaimer This presentation has been prepared by AS Merko Ehitus (the Company) solely for your use and benefit for information purposes only. By accessing, downloading, reading or otherwise making available to yourself any content of the presentation, in whole or in part, you hereby agree to be b