Press release
Paris, September 29, 2017
Results for the first nine months
(9m 2017, compared with 9m 2016)
Value: €1,166.7 million(+15.0%) including
VAT
Volume: 5,879 housing units (+12.5%)
6.1 months compared with 7.2 months
(on a12-month rolling basis)
(9m 2017 vs 9m 2016)
With Housing Units: €820.8 million (+18.5%)
Gross margin:
€181.8 million compared with €158.3 million over 9 months in
2016
Adjusted EBIT:
€80.6 million compared with €70.9 million over 9 months in
2016
Attributable net
income:
€33.2 million compared with €27.8 million over 9 months in
2016
Net financial
debt:
€35.0 million compared with €85.1 million at the end of
2016
Of which Housing Units:
€1,529.9 million (+19.3% vs. 9 months 2016)
|
Kaufman & Broad SA today announced its results for the first
nine months of the 2017 financial year (fromDecember 1, 2016 to
August 31, 2017).
Nordine Hachemi, Chairman and Chief Executive Officer of Kaufman
& Broad, said:
"The results for the first nine months of 2017
confirm the strong momentum shown in the past four
years.
The value of housing unit orders grew by 15.0% and
volumes by 12.5%. This increase was mainly driven by first-time
buyers (+16.0% by volume). The increases in the land reserve and in
the backlog confirm our strong long-term growth
capacity.
Lastly, Kaufman & Broad has, with SERENIS, a
company specialized in senior managed accomadations and health
infrasructures, created a joint venture to develop residences for
seniors. This initiative reaffirms the Group's commitment to the
booming managed accommodation segment.
During the third quarter, Kaufman & Broad
registered for € 110M in orders in the Commercial Property
Segment.
Our capacity to maintain a significantly smaller
marketing period compared to the market allows us to manage our
working capital requirements and our margins. It results into a
reduction of the net financial debt and a strengthening of
shareholder's equity.
Those different indicators show our capacity to
deliver high quality goods with relevant pricing considering our
customers bargaining power.
As expected, french government have recently
announced the upkeep of current arrangements for purchasing and
rental proprety investment in areas with housing shortage. This
leads us to confirm our perspectives for the year in a stable
market.
Thus, we confirming a growth around 10% for 2017
revenues. Gross margin and adjusted EBIT should remain around 19%
and 8.5% respectively. Net financial debt will continue to decline
relative to 2016 to around €50 million." |
Sales activities
In the first nine months of 2017,
orders for housing amounted to €1,166.7 million (including VAT) in
value terms, up 15.0% on the same period in 2016.
In volume terms, orders for
housing totaled 5,879 units, up 12.5% on the same period in
2016.
The marketing period for projects
was 6.1 months on a rolling 12-month basis, a decrease of 1.1
months compared with the same period in 2016 (7.2 months).
The commercial offer, at 92.2% in
housing shortage areas, amounted to 4,487 units at the end of
August 2017, up 5.3% on the end of 2016.
Breakdown of the customer base
In the first nine months of the
year, orders from first-time buyers accounted for 16% of sales by
volume, and those from second-time buyers 6%. Orders by investors
accounted for 48% of sales (Pinel arrangements alone 35%) and block
sales 29%.
In the first nine months of 2017,
the Commercial Property segment recorded €108.6 million (including
VAT) in orders.
During the summer, Kaufman &
Broad (through its specialist subsidiary Concerto) signed an
off-plan sale (VEFA) and a promissory off-plan sale for two
logistics platforms totaling more than 100,000 sq.m, representing
some €110 million excluding VAT of orders, in line with the €150 to
€200 million target announced last July.
At the end of August 2017, the
Commercial Property backlog totaled €194.7 million (excluding
VAT).
At August 31, 2017, the Housing
backlog amounted to €1,529.9 million (excluding VAT), i.e. 15.4
months of business. Kaufman and Broad had 238 housing programs on
the market at the same date, which represent 4,487 housing units,
compared with 208 programs representing 4,739 housing units at the
end of August 2016.
The Housing property portfolio,
98% of which is in housing shortage areas, amounted to 28,167
units, and was up 17.0% compared with the portfolio at the end of
August 2016. This corresponds to potential revenue of close to 4
years of business, stable relative to November 30, 2016 (4.1 years)
and to August 31, 2016 (4 years).
In the 4th quarter of
2017, the Group is planning to launch 50 new programs, including 15
in the Ile-de-France Region, representing 1,466 units; 34 programs
in the French Regions, representing 2,907 units, and 1 Commercial
Property program.
Total revenues amounted to €947.9
million (excluding VAT), up 13.5% compared with the same period in
2016.
Housing revenues amounted to
€820.8 million (excluding VAT), compared with €692.5 million
(excluding VAT) in 2016. They accounted for 86.6% of the group's
revenues.
Revenues from the Apartments
business were up 20% compared with the first nine months of 2016,
and amounted to €792.6 million (excluding VAT).
Revenues from the Commercial
property segment totaled €122.9 million (excluding VAT), compared
with €137.8 million (excluding VAT) over the same period in
2016.
The other businesses generated
revenues of €4.3 million (excluding VAT).
The gross margin for the first
nine months of 2017 totaled €181.8 million compared with €158.3
million in 2016. The gross margin ratio was 19.2%, or slightly
higher than in the same period of 2016 (19.0%).
Current operating expenses for the
first nine months amounted to €106.4 million (11.2% of revenues),
versus €92.5 million for the same period in 2016 (11.1% of
revenues).
Current operating profit totaled
€75.4 million, compared with €65.8 million in the first nine months
of 2016. The current operating margin was 8.0%, compared with 7.9%
in the first nine months of 2016.
The Group's adjusted EBIT amounted
to €80.6 million in the first nine months of 2017 (versus €70.9
million in the same period 2016). The adjusted EBIT was 8.5%
(stable relative to the same period in 2016).
Attributable net income amounted
to €33.2 million, compared with €27.8 million for the first nine
months of 2016.
Net financial debt amounted to
€35.0 million at August 31, 2017. Cash assets (available cash and
investment securities) amounted to €214.7 million, compared with
€118.1 million at November 30, 2016. Financing capacity totaled
€314.7 million (€218.1 million at November 30, 2016).
Working capital requirement
amounted to €118.9 million (8.8% of revenues on a 12-month rolling
basis), compared with €129.2 million at November 30, 2016 (10.4% of
revenues). The tight control on working capital primarily relies on
the very short marketing period for the Group's programs.
Pursuant to a decision by its
Board of Directors on July 10, Kaufman & Broad launched a
subscription offer for new shares reserved for group employees,
from September 21 to October 1 inclusive, representing a maximum
total of 1.7% of the share capital at August 31, 2017. Subscribed
through the corporate mutual fund (FCPE "KB Actions 2017"), the
shares will be unavailable until July 1, 2022 unless released early
where permitted by applicable regulations.
The main objective is to link
employees more closely to the future of the business by allowing
them to subscribe to shares on preferential terms. Currently
holding close to 12.4% of their company's capital, employees are
now the largest shareholder in Kaufman & Broad. A policy of
strong employee shareholding is a guarantee of independence and
stability for the company, as well as an opportunity for every
employees to benefit from its growth.
The group believes that the
increase in its revenues over the 2017 fiscal year should be in the
order of 10%, despite the wait-and-see attitudes to government land
tax announcements. The gross margin and adjusted EBIT ratios should
remain around 19% and 8.5% respectively. Net financial debt will
continue to decline relative to 2016 to around €50 million.
This release is available on the
www.kaufmanbroad.fr website
Contacts
Chief
Financial Officer
Bruno Coche
+33 (0)1 41 43 44 73
Infos-invest@ketb.com |
Press Relations
Marianne Cruciani
|
Corporate Communication Emmeline Cacitti |
Burson-Marsteller
+33 (0)1 56 03 12 80
contact.presse@ketb.com |
(+33) 1 41 43 44 17
ECACITTI@ketb.com
|
About Kaufman
& Broad - Kaufman & Broad has been designing,
building and selling single-family homes in communities,
apartments, and offices on behalf of third parties for almost 50
years. Kaufman & Broad is one of the leading French
Property Development & Construction companies due to the
combination of its size and profitability, and the strength of its
brand.
The Kaufman &
Broad Registration Document was filed with the French Financial
Markets Authority ("AMF") under No. D.17.0286 on March 31, 2017. It
is available on the AMF (www.amf-france.org)
and Kaufman & Broad (www.kaufmanbroad.fr)
websites. It contains a detailed description of Kaufman &
Broad's business activities, results, and prospects, as well as of
the related risk factors. Kaufman & Broad specifically draws
attention to the risk factors set out in Chapter 1.2 of the
Registration Document. The materialization of one or several of
these risks may have a material adverse impact on the Kaufman &
Broad Group's business activities, net assets, financial position,
results, and outlook, as well as on the price of Kaufman &
Broad's shares.
This press
release does not amount to, and cannot be construed as amounting to
a public offering, a sale offer or a subscription offer, or as
intended to seek a purchase or subscription order in any
country.
Backlog: For
off-plan sales (VEFA), it covers housing ordered but not delivered
for which the notarized sale deeds have not yet been signed, and
housing ordered but not delivered for which the notarized sale
deeds have been signed but not yet posted to revenue (for a program
that is 30% completed, 30% of housing revenue for which the
notarized sale deed has been signed is accounted for as sales, 70%
is included in the backlog). The backlog is a summary at any given
time that allows an estimate of the remaining revenue to be
recognized in the months ahead and that serves as a basis the
group's forecasts. It should be noted that a degree of uncertainty
exists when converting backlog into revenue, especially for orders
not yet officially notarized.
Off-plan lease
(BEFA): an off-plan lease involves a customer leasing a
building before it is even built or redeveloped.
Marketing
period: the inventory marketing period is the number of months
required for the available housing units to be sold, if sales
continue at the same rate as for the previous units, or the number
of housing units (available supply) per quarter divided by the
orders for the previous quarter, and divided by three in turn.
Adjusted
EBIT: corresponds to income from current operations restated
for capitalized "IAS 23 revised" borrowing costs, which are
deducted from the gross margin.
EHU: The EHUs
(Equivalent Housing Units) delivered are a direct reflection of
business volumes. The number of EHUs is obtained by multiplying (i)
the number of housing units in a given program for which notarized
sale deeds have been signed by (ii) the ratio between the Group's
property expenses and construction expenses incurred on said
program and the total expense budget for said program.
Gross margin:
Gross margin corresponds to revenues less cost of sales. Cost of
sales consists of the price of land parcels, the related property
costs (taxes, etc.), commissions paid to developers and to Kaufman
& Broad sales staff, as well as fees and commissions provided
for in the agency agreements executed by Kaufman & Broad
in order to sell its real estate programs, construction costs and
borrowing costs that may be directly attributed to program
development.
Commercial
offer: is represented by the total inventory of housing units
available for sale at the relevant date, i.e. all housing units
that have not been ordered on that (minus the sales tranches that
have not been released for marketing).
Property
portfolio: represents all of the land for which any commitment
(contract for sale, etc.) has been signed.
Orders:
measured in volume (Units) and in value terms; orders reflect the
Group's sales activity. Their inclusion in revenues is conditional
on the time required to turn an order into a signed and notarized
deed, which is the triggering event for booking the income. In
addition, in the case of multiple-dwelling programs that include
mixed-use buildings (apartments, business premises, retail space,
and offices), all of the floor space is converted into housing
equivalents.
Land reserve:
This includes land to be developed (otherwise known as the "land
portfolio"), i.e. land for which a deed or contract of sale has
been signed, as well as land still being surveyed or assessed, i.e.
land for which a deed or a contract of sale has not yet been
signed.
Marketing period
ratio: the marketing period ratio represents the percentage of
the initial inventory that is sold on a monthly basis for a
property program (sales per month divided by the initial
inventory), i.e. net monthly orders divided by the ratio between
the opening inventory and the closing inventory, divided by two.
NB: The inverse of the take-up rate (1/Te) gives the projected
duration (in months) of the marketing of a program, i.e. the
take-up period. For example, a 4.0% take-up rate corresponds to a
projected duration of 25 months of marketing.
Units: units
are used to define the number of housing units or equivalent
housing units (for mixed programs) in a given program. The number
of equivalent housing units is calculated as a ratio between the
surface area by type (business premises, retail space, or offices)
and the average surface area of the housing units previously
obtained.
Off-plan sale
(VEFA): anoff-plan sale is an agreement via which the vendor
transfers their rights to the land and their ownership of the
existing buildings to the purchaser immediately. The future
structures will become the purchaser's property as they are
completed: the purchaser is required to pay the price of these
structures as the works progress. The vendor retains Project
Management powers until the works are accepted.
APPENDICES
Key consolidated data*
€ '000s |
Q3 2017 |
9M 2017 |
T3 2016 |
9M 2016 |
Revenues |
320,264 |
947,940 |
260,504 |
835,304 |
|
285,855 |
820,820 |
240,960 |
692,529 |
|
35,850 |
122,866 |
17,527 |
137,766 |
|
1,529 |
4,254 |
2017 |
5,009 |
|
|
|
|
|
Gross margin |
61,859 |
181,762 |
49,372 |
158,338 |
Gross
margin (%) |
19.3% |
19.2% |
19.0% |
19.0% |
Current operating
profit |
26,630 |
75,380 |
20,163 |
65,793 |
Current operating margin (%) |
8.3% |
8.0% |
7.7% |
7.9% |
Adjusted EBIT** |
28,498 |
80,597 |
21,465 |
70,902 |
Adjusted EBIT margin (%) |
8.9% |
8.5% |
8.2% |
8.5% |
Attributable net
income |
13,048 |
33,200 |
9,609 |
27,756 |
Attributable net earnings per share (€/share)*** |
0.63 |
1.59 |
0.46 |
1.33 |
***Based on the number of shares that make up Kaufman &
Broad S.A.'s share capital, i.e. 20,839,037 shares.
Consolidate income statement*
€ '000s |
Q3 2017 |
9M 2017 |
Q3 2016 |
9M 2016 |
Revenues |
320,264 |
947,940 |
260,504 |
835,304 |
Cost of sales |
-258,405 |
-766,178 |
-211,132 |
-676,966 |
Gross
margin |
61,859 |
181,762 |
49,372 |
158,338 |
Selling expenses |
-9,196 |
-27,082 |
-7,231 |
-23,329 |
Administrative
expenses |
-15,408 |
-47,949 |
-12,643 |
-40,082 |
Technical and customer
service expenses |
-4,454 |
-15,044 |
-4,611 |
-14,404 |
Development and
program expenses |
- 6,171 |
-16,306 |
-4,724 |
-14,730 |
Current operating profit |
26,630 |
75,380 |
20,163 |
65,793 |
Other non-recurring
income and expenses |
- |
- |
- |
- |
Operating income |
26,630 |
75,380 |
20,163 |
65,793 |
Cost of net financial
debt |
-1,266 |
-3,397 |
-1,016 |
-2,410 |
Other financial
expenses and income |
- |
- |
- |
- |
Income tax |
-7,407 |
-20,773 |
-5,529 |
-20,435 |
Share of
income/loss
of equity affiliates and joint ventures |
709 |
507 |
-67 |
-187 |
Net
income of the consolidated entity |
18,666 |
51,717 |
13,552 |
42,761 |
Non-controlling interests |
5,617 |
18,517 |
3,943 |
15,005 |
Attributable net income |
13,049 |
33,200 |
9,609 |
-
27,756
|
*Unaudited and not approved by the Board of
Directors.
Consolidated balance sheet*
€ '000s |
August 31, 2017 |
30 Nov 2016 |
ASSETS |
|
|
Goodwill |
68,661 |
68,661 |
Intangible assets |
88,659 |
87,570 |
Property, plant and
equipment |
8,149 |
7,449 |
Equity affiliates and
joint ventures |
12,008 |
5,634 |
Other non-current
financial assets |
1,752 |
2,504 |
Deferred tax
assets |
2,613 |
- |
Non-current assets |
181,842 |
171,818 |
Inventories |
379,918 |
371,381 |
Accounts
receivable |
317,201 |
375,669 |
Other receivables |
147,313 |
159,772 |
Cash and cash
equivalents |
214,745 |
118,108 |
Prepaid expenses |
1,337 |
1,345 |
Current assets |
1,060,514 |
1,026,275 |
TOTAL ASSETS |
1,242,356 |
1,198093 |
|
|
LIABILITIES |
|
|
Share capital |
5,418 |
5,418 |
Premiums, reserves and
other |
124,983 |
79,119 |
Attributable net
income |
33,200 |
46,035 |
Attributable equity capital |
163,601 |
130,571 |
Non-controlling
interests |
13,905 |
15,196 |
Equity capital |
177,506 |
145,767 |
Non-current
provisions |
22,746 |
23,229 |
Borrowings and other
non-current financial liabilities
(portion maturing in > 1 year) |
248,319 |
191,362 |
Deferred tax
liabilities |
64,037 |
45,471 |
Non-current
liabilities |
335,102 |
260,062 |
Current
provisions |
1,441 |
1,499 |
Other current
financial liabilities (portion maturing in < 1 year) |
1,435 |
11,841 |
Trade payables |
641,660 |
675,146 |
Other payables |
84,777 |
97,382 |
State - current
taxes |
- |
5,858 |
Deferred
income |
435 |
539 |
Current liabilities |
729,748 |
792,264 |
TOTAL LIABILITIES |
1,242,356 |
1,198093 |
*Unaudited and not approved by
the Board of Directors.
Housing |
Q3 2017 |
9M 2017 |
Q3 2016 |
9M 2016 |
|
|
|
|
|
Revenues (€ million,
excl. VAT) |
282.9 |
820.8 |
241.0 |
692.5 |
|
272.7 |
792.6 |
229.7 |
660.6 |
|
10.2 |
28.2 |
11.3 |
31.9 |
|
|
|
|
|
Deliveries (EHUs) |
1,800 |
5,271 |
1,446 |
4,244 |
|
1,746 |
5,135 |
1,396 |
4,105 |
|
54 |
136 |
50 |
139 |
|
|
|
|
|
Net orders (in
number) |
1,779 |
5,879 |
1,711 |
5,228 |
|
1,664 |
5,669 |
1,684 |
5,093 |
|
115 |
210 |
27 |
135 |
|
|
|
|
|
Net orders (€
millions, excl. VAT) |
381.9 |
1,166.7 |
340.9 |
1,014.5 |
|
341.2 |
1,105.3 |
333.6 |
979.0 |
|
40.7 |
61.3 |
7.3 |
35.4 |
|
|
|
|
|
Commercial offer at
end of period (by number) |
4,508 |
4,739 |
|
|
|
|
|
Backlog at end of
period |
|
|
|
|
|
1,529.9 |
1,282.9
1,245.8
37.1
14.9
24,077 |
|
1,459.2 |
|
70.7 |
|
15.4 |
|
|
Land
reserve at end of period (by number) |
28,167 |
Commercial property |
Q3 2017 |
9M 2017 |
Q3 2016 |
9M 2016 |
|
|
|
|
|
Revenues (€ million,
excl. VAT) |
35.8 |
122.9 |
17.5 |
137.8 |
Net orders (€
millions, excl. VAT) |
108.6 |
108.6 |
29.7 |
251.3 |
Backlog at
end of period (€ millions, excl. VAT) |
194.7 |
245.0 |
RESULTS FOR THE FIRST NINE MONTHS
2017 Kaufman & Broad
This
announcement is distributed by Nasdaq Corporate Solutions on behalf
of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: Kaufman & Broad SA via Globenewswire
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