Press release
Paris, April 11, 2018
2018 1ST QUARTER RESULTS
(Q1 2018 vs Q1 2017)
€M408.9 including VAT (+21.5%)
Of which housing units:
€M345.3 including VAT (+2.6%)
In volume terms: 1,824 units (+1.3%)
Marketing period for housing
4.5 months compared with 6.1 months
( -1.6 months)
Key financial data
(Q1 2018 vs Q1 2017)
Of which housing units:
€M285.1 (+15.4%)
€63.4 million (+15.8%)
€M0.5 vs. €M33.1 at the end of 2017
(Q1 2018 vs Q1 2017)
Of which housing:
€M1,677.2 (+19.8%)
|
Kaufman & Broad SA today announced its results
for the first quarter of the 2018 fiscal year (from December 1,
2017 to February 28, 2018).
Nordine Hachemi, Chairman and Chief Executive
Officer of Kaufman & Broad, made the following
comments:
"Results of the 1st quarter 2018 are in line with
2017 performances.
Housing orders in value are growing by 2.6% in a
market expected to wane slightly. The take up period of our
operations continued to improve to 4.5 months. It confirms the
compatibility and the adaptability of our commercial offer to the
demand.
Also, the Commercial activity has confirmed its
development with orders amounting to €63.5 million including VAT
for the first quarter in a still steady market.
The global Backlog continues its solid
development, with almost 18% and 20% for the Housing activity only,
confirming our growth momentum.
This strong visibility given by the high level of
our Backlog allow us to manage rigorously our housing property
portfolio increasing by 2% which today represents more than three
years of activity. It allow us to offer to our clients operations
with a selling price matching their financial capacity and
therefore to keep a fast take-up period.
During the 1st quarter, our policy to manage sale
prices, land and building costs as well as operating costs leads to
a 48% growth in adjusted Ebit, i.e. more than 9% of total revenue.
In the same time, working capital requirement remains stable,
allowing a reduction of the net debt close to zero.
In this context, and based on unchanged
anticipated interest rates, Kaufman & Broad confirms its
outlook, announced last January, for the full-year 2018. Thus,
revenue growth should be in the range of 8% to 10%. The gross
margin ratio is expected to remain at around 19%, while the
adjusted EBIT ratio is expected to stand between 8.5% and
9%."
|
Sales
activities
Orders for housing units in value
terms amounted to €345.3 million (including VAT) for the first
quarter of the 2018 fiscal year, representing an increase of 2.6%
compared with 2017.
In volume terms, orders for
housing units amounted to 1,824 homes, up 1.3% compared with
2017.
The marketing period for projects
was 4.5 months, down 1.6 months compared with 2017 (6.1
months).
The commercial offer, 95% of which
is located in areas where there is a shortfall (A, Abis and B1), amounted to 3,395 housing units at the end
of February 2018 (4,195 housing units at the end of February
2017).
Breakdown of the
customer base
Orders from first-time buyers
accounted for 15% of sales in volume terms, while those from
second-time buyers accounted for 5%. Orders from investors
accounted for 31% of sales (26% for the Pinel scheme alone), while
block sales accounted for 49%, of which more than 60% is managed
housing (tourism, student, business or senior).
The business property segment
registered net orders of €63.5 million, including VAT, in the first
quarter of 2018, corresponding to a logistical platfrom for an
European investor.
Also, Kaufman & Broad has
signed an off-sales contract (VEFA) to carry out the development of
approximately 7 000 sq.m of office premises at Eurasanté, which is
a specialized center focused around the health industry and develop
by the Lille metropolitan area (city of Loos). The building will be
welcoming the new offices of the French blood Institute, with whom
Kaufman & Broad already signed a commercial lease in the future
state of completion (BEFA).
Kaufman & Broad is
commercializing or having under study around 150,000 sq.m of office
premise and around 200,000 sq.m of logistic platform.
Otherwise, more than 60,000 sq.m
of office premise are currently under construction (SNI Paris
13th , ORA
Paris 17th , EDF
Bordeaux, Polaris in Nantes .).
The business property backlog
amounted to €194.2 million (excluding VAT) at the end of February
2018.
The housing backlog amounted to
€1,677.2 million (excluding VAT) at February 28, 2018, i.e. 13.4
months of business. Kaufman and Broad had 202 home programs
on the market at the same date, representing 3,395 housing units,
compared with 215 programs representing 4,195 housing units at the
end of February 2017.
The housing property portfolio
represents 28,138 units, up 2.0% compared with the end of February
2017, and corresponds to potential revenues of more than three
years of business.
The Group plans to launch 40 new
programs in the second quarter of 2018, including 13 in
Île-de France (1,466 units), 27 programs in the other French
regions (1,917 units).
Total revenues amounted to €328.0
million (excluding VAT), up 14.0% compared with 2017.
Housing revenues amounted to
€285.1 million (excluding VAT), compared with €247.0 million
(excluding VAT) in 2017. They accounted for 86.9% of the group's
revenues.
Revenues from the apartments
business were up 12.2% compared with 2017, and amounted to
€270.1 million (excluding VAT).
The business property segment's
revenues amounted to €40.7 million (excluding VAT), compared with
€39.6 million (excluding VAT) in 2017.
The other businesses generated
revenues of €2.3 million (excluding VAT), compared with
€1.2 million in 2017.
The gross margin for the
1st quarter of
2018 year amounted to €63.4 million, compared with €54.7
million in 2017. The gross margin ratio was 19.3%, slightly higher
than the level of the 1st quarter of
2017 (19.0%).
Current operating expenses
amounted to €36.0 million (11.0% of revenues), compared with €35.5
million for 2017 (12.3% of revenues).
Current operating profit amounted
to €27.4 million, compared with €19.2 million in 2017. The current
operating margin ratio was 8.3%, compared with 6.7% in 2017.
The group's adjusted EBIT amounted
to €30.6 million in 2018 (compared with €20.7 million in 2017). The
adjusted EBIT margin was 9.3% (compared with 7.2% in 2017).
Attributable net income for 2018
is €13.7 million compared with €7.4 million in 2017.
Net financial debt amounted to
€0.5 million at February 28, 2018, down €32.6 million compared with
€33.1 million at the end of 2017. Cash assets (available cash and
investment securities) amounted to €255.0 million, compared with
€221.1 million at November 30, 2017. The group's financing capacity
was €355.0 million (€321.1 million at November 30, 2017).
The working capital requirement
amounted to €133 million (9.3% of revenues), compared with €147.6
million at November 30, 2017 (10.6 % of revenues), and €140.7
million at the end of February 2017 (10.9% of revenues). The tight
control over working capital primarily relies on the very short
marketing period for the Group's programs.
The meeting of the Board of
Directors of Kaufman & Broad SA of March 7, 2018 resolved to
propose the distribution for the 2017 fiscal year (ended November
30, 2017) of a dividend of €2.10 per share, up 13.5% compared with
the dividend paid for 2016 (€1.85 per share), subject to approval
by the Shareholders Meeting, which will take place on May 3, 2018.
A proposal will also be made to this Shareholders' Meeting to give
Kaufman & Broad's shareholders the option to receive this
dividend in cash, in shares, or in cash and shares.
The Board of Directors planned to
submit to the Shareholder meeting on the 3rd of May the
nomination of Mrs Karine Normand as a Director representing
employee shareholding, owing close to 14% of the shares.
During this meeting, it will also
be submitted the nomination of Mrs Lucile Ribot as an independent
Director in order to reinforce governance.
The number of Directors will thus
amount to 10 members including 6 independent Directors.
The Group considers that its
revenue growth should range between 8% and 10% for the 2018 fiscal
year. The gross margin ratio is expected to remain at around 19%,
while the adjusted EBIT ratio is expected to be between 8.5% and
9%.
This press release
is available on the www.kaufmanbroad.fr website
Contacts
Chief Financial
Officer
Bruno Coche
+33 (1) 41 43 44 73
Infos-invest@ketb.com
Media relations:
Hopscotch Capital: Violaine Danet
+33 (1) 58 65 00 77 / k&b@hopscotchcapital.fr
Kaufman & Broad: Emmeline
Cacitti
+33 (6) 72 42 66 24 / 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 50 years.
Kaufman & Broad is one of the leading French
developers-builders 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.18 0226 on March
29, 2018. 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 outlook, as well as the associated risk factors.
Kaufman & Broad specifically draws attention to the risk
factors set out in Chapter 1.2 of the Registration Document. The
occurrence of one or more of these risks might 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: In
the case of sales before completion, this covers orders for housing
units that have not been delivered, and for which a notarized deed
of sale has not yet been signed, and orders for housing units that
have not been delivered for which a notarized deed of sale has been
signed for the portion not yet recorded in revenues (in the case of
a program for which an advance of 30% has been received, 30% of the
revenues from a housing unit for which a notarized deal has been
signed is recognized as revenues, while 70% is included in the
backlog). The backlog is a summary at a given time, which enables
the revenues yet to be recognized over the coming months to be
estimated, thus supporting the Group's forecasts - with the proviso
that there is an element of uncertainty in the transformation of
the backlog into revenues, particularly for orders that have not
yet been signed.
Lease before completion: a lease before completion involves a
customer leasing a building before it is 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 current operating profit 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:
The gross margin corresponds to revenues less cost of sales. The
cost of sales consists of the price of the land, and the related
property costs (levies, etc.), the commissions paid to developers
and to Kaufman & Broad's sales staff, the fees and commissions
included in the mandates issued by Kaufman & Broad in order to
sell the real estate programs, construction costs, and the
borrowing costs that can be directly allocated to the development
of programs.
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 date (minus the sales tranches
that have not been released for marketing).
Property
portfolio: represents all of the land for which any commitment
(contract of 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 multi-occupancy housing programs that
include mixed-use buildings (apartments, business premises, retail
space, and offices), all of the floor space is converted into
housing unit equivalents.
Land reserve:
This includes land to be developed (which is alternatively called
the "property portfolio"), i.e. land for which a deed or promise of
sale has been signed, as well as land under review, i.e. land for
which a deed or a contract of sale has not yet been signed.
Take-up rate:
the take-up rate 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/MPR) gives the expected timeframe (in months) for the marketing
of a program, i.e. the marketing period. For instance, a take-up
rate of 4.0% corresponds to an expected marketing period of 25
months.
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.
Sale before
completion: a sale before completion is an agreement via which
the vendor transfers its rights to the land and its 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 owner
powers until the works are accepted.
NOTES
Key consolidated
data
In € million |
Q1
2018 |
Q1
2017 |
Revenues |
328.0 |
287.7 |
|
285.1 |
247.0 |
|
40.7 |
39.6 |
|
2.3 |
1.2 |
|
|
|
Gross margin |
63.4 |
54.7 |
Gross
margin ratio (%) |
19.3% |
19.0% |
Current operating
profit |
27.4 |
19.2 |
Current operating margin (%) |
8.3% |
6.7% |
Adjusted EBIT* |
30.6 |
20.7 |
Adjusted EBIT margin (%) |
9.3% |
7.2% |
Attributable net
income |
13.7 |
7.4 |
Attributable net earnings per share (€/share)** |
0.65 |
0.36 |
* Adjusted EBIT corresponds to current operating profit
restated for capitalized "IAS 23 revised" borrowing costs, which
are deducted from the gross margin.
**Based on the number of
shares that make up Kaufman & Broad's share capital, i.e.
20,837,039 shares at February 28, 2017, and 21,073,535 shares at
February 28, 2018 following the issue of 236,496 shares for the
capital increase reserved for employees at November 30,
2017.
Consolidated
income statement*
€ thousands |
Q1
2018 |
Q1
2017 |
Revenues |
328,031 |
287,718 |
Cost of sales |
(264,666) |
233,001 |
Gross
margin |
63,365 |
54,717 |
Selling expenses |
(8,617) |
(8,791) |
General administrative
expenses |
(14,768) |
(16,638) |
Technical and
after-sales service expenses |
(5,376) |
(5,415) |
Development and
program expenses |
(7,218) |
(4,623) |
Current operating profit |
27,386 |
19,250 |
Other non-recurring
income and expenses |
- |
- |
Operating income |
27,386 |
19,250 |
Cost of net financial
debt |
(1,910) |
(860) |
Other financial income
and expense |
- |
- |
Income tax |
(7,146) |
(4,437) |
Share of income
(loss)
of equity affiliates and joint ventures |
769 |
(125) |
Net
income of the consolidated entity |
19,099 |
13,828 |
Non-controlling equity interests |
5,352 |
6,402 |
Attributable net income |
13,747 |
7,426 |
* Not approved by the Board of
Directors and not audited.
Consolidated balance sheet
€ thousands |
February 28
2018 |
30 November 2017 |
ASSETS |
|
|
Goodwill |
68,661 |
68,661 |
Intangible assets |
89,580 |
89,442 |
Property, plant and
equipment |
8,253 |
7,699 |
Equity affiliates and
joint ventures |
18,257 |
14,815 |
Other non-current
financial assets |
2,411 |
2,311 |
Deferred tax
assets |
4,227 |
4,227 |
Non-current assets |
191,388 |
187,155 |
Inventory |
374,693 |
384,882 |
Trade receivables |
334,837 |
340,142 |
Other receivables |
159,110 |
198,968 |
Cash and cash
equivalents |
254,961 |
221,065 |
Prepaid expenses |
1,456 |
1,079 |
Current assets |
1,125,057 |
1,146,136 |
TOTAL ASSETS |
1,316,446 |
1,333,291 |
|
|
LIABILITIES |
|
|
Share capital |
5,479 |
5,479 |
Additional paid-in
capital |
190,673 |
132,670 |
Attributable net
income |
13,747 |
59,118 |
Attributable shareholders' equity |
209,899 |
197,268 |
Non-controlling equity
interests |
21,266 |
18,174 |
Shareholders' equity |
231,165 |
215,442 |
Non-current
provisions |
24,270 |
24,952 |
Non-current financial
liabilities (maturing in > 1 year) |
249,629 |
249,615 |
Deferred tax
liabilities |
66,962 |
60,105 |
Non-current liabilities |
340,862 |
334,672 |
Current
provisions |
1,483 |
1,191 |
Other current
financial liabilities (maturing in < 1 year) |
5,823 |
4,541 |
Trade payables |
651,366 |
652,012 |
Other payables |
85,370 |
125,178 |
Deferred
income |
376 |
255 |
Current liabilities |
744,419 |
783,177 |
TOTAL EQUITY AND LIABILITIES |
1,316,446 |
1,333,291 |
*Not approved by the Board of
Directors and not audited.
Housing |
Q1
2018 |
Q1
2017 |
|
|
|
Revenues (€ million,
excluding VAT) |
285.1 |
247.0 |
|
270.1 |
240.7 |
|
15.0 |
6.3 |
|
|
|
Deliveries (EHUs) |
1,709 |
1,556 |
|
1,647 |
1,532 |
|
62 |
24 |
|
|
|
Net orders
(number) |
1,824 |
1,800 |
|
1,774 |
1,748 |
|
50 |
52 |
|
|
|
Net orders (€ million,
including VAT) |
345.3 |
336.5 |
|
328.5 |
325.2 |
|
16.8 |
11.3 |
|
|
|
End-of-period
commercial offer (number) |
3,395 |
4,195 |
|
|
|
End-of-period
backlog |
|
|
|
1,677.2 |
1,400.4 |
|
1,599.7 |
1,349.4 |
|
77.5 |
51.0 |
|
13.4 |
15.3 |
|
|
|
End-of-period land reserve (number) |
28,138 |
27,580 |
Business property |
Q1
2018 |
Q1
2017 |
|
|
|
Revenues (€ million,
excluding VAT) |
40.7 |
39.6 |
Net orders (€ million,
including VAT) |
63.5 |
0.0 |
End-of-period backlog (€ million, excluding VAT) |
194.2 |
190.0 |
Kaufman & Broad SA : Results
for the 1st quarter of 2018
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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