Paris,
Continued good momentum in
Strong revenue growth in Services +11%
Enhanced low-carbon and biodiversity ambition
Annual targets unchanged
- New home reservations stable
- 3,490 units during Q1 2022
- Quarterly revenue down impacted by Commercial real estate
- Strong growth in Services,
Residential Real Estate almost stable - Decrease in
Commercial Real Estate given high basis of comparison in Q1 2021
- Accelerated strategy to consolidate Nexity’s leadership within real estate sector in decarbonation and biodiversity protection
- Objective of a certified carbon trajectory aligned with the Paris agreements at 1.5°C by 2030
- Unchanged annual targets
- 2022 financial objectives: current operating profit of at least €380m1
- Strong visibility provided by future revenue in backlog (above €6bn)
Key figures at end-March 2022
New home reservations in France | Q1 2022 | Q1 2021(1) | Change 22 vs 21 |
Volume | 3,490 units | 3,508 units | - 18 units |
Value | €764m | €792m | -3.5% |
Revenue (€m) | Q1 2022 | Q1 2021(1) | Change 22 vs 21 |
Development | 699 | 851 | -18% |
Residential real estate | 626 | 655 | -4% |
Commercial real estate | 72 | 195 | -63% |
Services | 195 | 176 | +11% |
Other activities | 1 | 1 | |
Revenue | 895 | 1,028 | -13% |
(1) Data on a like-for-like basis, i.e excluding disposed activities during H1 2021: Century 21 (consolidated until 31 March) and Ægide-Domitys (consolidated until 30 June).
Véronique BÉDAGUE, Chief Executive Officer, commented:
“Business activity and revenue in the first quarter, traditionally contributing the least to the results of the year, are in line with our expectations. New home reservations remained strong, supported by continued low interest rates and strong available liquidity. The +11% revenue growth posted by our Services activities continues to demonstrate the relevance of our unique integrated real estate operator model. In a market where the number of building permits issued nationwide is recovering but remains below its pre-covid level,
We hope that, coming out of the presidential elections that have just been held, there will be a collective political awareness in order to address the many challenges raised by housing in our country, which has been the great absentee of this presidential campaign even though it is at the heart of French people's lives and constitutes their first item of expenditure.
Finally, I will have the pleasure of meeting our shareholders in person this year at our next Shareholders’ Meeting on 18 May, during which will be notably submitted to shareholders’ vote a 25% increase in dividend (to €2.50 per share) as a sign of our confidence in the future, and our low-carbon and biodiversity roadmap, which reflects
Residential real estate: Business activity still dynamic
Business activity: After an initial slowdown of several days, the Group has not observed any major change in customer behaviour since the start of the conflict in
Against a slow recovery in the building permits grants but longer timeframes for setting up operations, the low level of commercial launches and the still rapid time-to-market (4.0 months) still do not make it possible to rebuild the supply for sale, which remains low at the end of
Revenue: Residential real estate revenue amounted to €626 million, down 4% compared to the end of
Outlook: The first quarter is traditionally not representative of the activity expected during the year. The Group remains confident in its ability to absorb the pressure on construction costs for ongoing projects and to maintain its margins levels thanks to its size, its prudent provisioning policy and the visibility provided by its backlog (€5.6 billion, i.e. two years of activity).
Commercial real estate: a transition period
Business activity: In a bottom of the cycle and still wait-and-see market,
Revenue: Commercial real estate revenue amounted €72 million at end-March, down 63% compared to Q1 2021 (€195 million) which included in particular the contribution of more than
Outlook: Given the maturity of the project portfolio and the wait-and-see attitude of users in the market, commercial order intake should reach a low point in 2022 as expected. The backlog (€935 million, i.e. 3 years of activity) and the activity business potential (€1.9 billion, i.e. 5 years of activity) give the Group good visibility on future financial results.
Services: Dynamism of activity
At the end of
It is mainly driven by serviced properties, which grown very strongly: +40% compared to the end of
Revenue from property management activities was slightly up by +1% to €92 million supported by the good performance of the property management for individuals (+1.7%), and in particular the transaction and seasonal rental activities.
Revenue from distribution activities was up by +10% as a result of the good level of signatures of notarial deeds resulting from the volumes of reservations recorded in 2021.
IFRS Consolidated revenue
Under IFRS, consolidated revenue at
As a reminder, revenue generated by the development businesses from VEFA off-plan sales and CPI development contracts is recognised using the percentage-of-completion method, i.e. on the basis of notarised sales and pro-rated to reflect the progress of all inventoriable costs.
Acceleration of the climate and biodiversity strategy and enhanced carbon trajectory
Committed since 2019 to the Science Based Target Initiative (SBTi) and after obtaining the "Well below 2°C" certification of its carbon trajectory scopes 1, 2 and 3 in
In terms of biodiversity,
To ensure consistency between what it says and what it does, and because
2022 outlook
The Group repeats the objectives for the full year 2022 communicated last February: a market share of over 14%3 and a current operating profit of at least €380 million, enabling the operating margin to be maintained at around 8%. To date, this outlook remains unchanged.
***
Financial calendar & Practical informations
Shareholders’ Meeting Wednesday
2021 dividend, subject to approval at the Shareholders’ Meeting
- Ex-dividend date Monday
23 May 2022 - Payment date Wednesday
25 May 2022
2022 Half-Year results Wednesday
Q3 2022 business activity and revenue Wednesday
A conference call will be held today in French with a simultaneous translation into English at
The presentation accompanying this conference will be available on the Group’s website from The conference call will be available on replay at https://nexity.group/en/finance from the following day. |
Disclaimer: The information, assumptions and estimates that the Company could reasonably use to determine its targets are subject to change or modification, notably due to economic, financial and competitive uncertainties. Furthermore, it is possible that some of the risks described in Section 2 of the Universal Registration Document filed with the AMF under number D.21-0283 on
Contacts:
Géraldine Bop – Deputy Head of Investor relations / +33 (0)6 23 15 40 56 – investorrelations@nexity.fr
ANNEX OPERATIONAL REPORTING
Reservations –
2022 | 2021 | 2020 | ||||||||||
Number of units | Q1 | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 | |||
New homes ( | 3,490 | 7,658 | 4,092 | 4,843 | 3,508 | 7,299 | 3,848 | 5,402 | 3,450 | |||
Subdivisions | 337 | 772 | 367 | 439 | 338 | 660 | 244 | 297 | 360 | |||
International | 133 | 216 | 247 | 404 | 249 | 503 | 193 | 74 | 165 | |||
Total new scope | 3,960 | 8,646 | 4,706 | 5,686 | 4,095 | 8,462 | 4,285 | 5,773 | 3,975 | |||
Reservations carried out directly by Ægide | 348 | 389 | 143 | 336 | 392 | 207 | ||||||
Total | 3,960 | 8,646 | 4,706 | 6,034 | 4,484 | 8,605 | 4,621 | 6,165 | 4,182 |
2022 | 2021 | 2020 | ||||||||||
Value, in €m incl. VAT | Q1 | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 | |||
New homes ( | 764 | 1,447 | 845 | 1,056 | 792 | 1,534 | 855 | 1,141 | 750 | |||
Subdivisions | 27 | 55 | 33 | 42 | 29 | 57 | 19 | 25 | 30 | |||
International | 18 | 31 | 48 | 72 | 41 | 91 | 29 | 11 | 26 | |||
Total new scope | 808 | 1.533 | 927 | 1,170 | 862 | 1,682 | 903 | 1,177 | 806 | |||
Reservations carried out directly by Ægide | 85 | 90 | 32 | 70 | 90 | 41 | ||||||
Total | 808 | 1,533 | 927 | 1,255 | 952 | 1,713 | 974 | 1,267 | 847 |
Breakdown of new home reservations in In number of units | Q1 2022 | Q1 2021 | Change Q1 2022/Q1 2021 | ||
Homebuyers | 704 | 20% | 867 | 25% | -19% |
o/w: - First time buyers | 617 | 18% | 738 | 21% | -16% |
- Other home buyers | 87 | 2% | 129 | 4% | -33% |
Individual investors | 1,430 | 41% | 1,762 | 50% | -19% |
Professional landlords | 1,356 | 39% | 879 | 25% | 54% |
O/w : - Institutional investors | 273 | 8% | 113 | 3% | 142% |
- Social housing operators | 1.083 | 31% | 766 | 22% | 41% |
Total | 3,490 | 100% | 3,508 | 100% | -1% |
Backlog
2022 | 2021 | 2020 | ||||||||||
In € million, excluding VAT | Q1 | FY | 9M | H1 | Q1 | FY | 9M | H1 | Q1 | |||
Residential Real Estate development | 5,551 | 5,565 | 5,610 | 5,504 | 5,399 | 5,509 | 5,100 | 4,986 | 4,522 | |||
Commercial Real Estate development | 935 | 974 | 1,013 | 1,059 | 1,138 | 1,032 | 321 | 373 | 398 | |||
Total backlog new scope | 6,485 | 6,538 | 6,622 | 6,563 | 6,536 | 6,541 | 5,421 | 5,359 | 4,920 | |||
Operations carried out directly by Ægide | . | 242 | 280 | 298 | 300 | 274 | ||||||
Total backlog | 6,485 | 6,538 | 6,622 | 6,563 | 6,778 | 6,820 | 5,719 | 5,659 | 5,194 |
Services
March 2022 | December 2021 | Change | March 2021 | ||||||
Property Management | |||||||||
Portfolio of managed units | |||||||||
- Condominium management | 675,000 | 672,000 | stable | 681,000 | |||||
- Rental management | 157,000 | 155,000 | +1% | 160,000 | |||||
Commercial real estate | |||||||||
- Assets under management (in millions of sq.m) | 20.2 | 20.4 | -1% | 20.1 | |||||
Serviced properties | |||||||||
Student residences | |||||||||
- Number of residences in operation | 129 | 129 | - | 125 | |||||
- Rolling 12-month occupancy rate | 93.7% | 92.7% | +1.0 bp | ||||||
Shared office space | |||||||||
- Managed areas (in sq.m) | 67,000 | 57,000 | +18% | 57,000 | |||||
- Rolling 12-month occupancy rate | 79% | 74% | +5.0 bps | ||||||
Distribution | |||||||||
- Total reservations | 1,082 | -19% | 1,344 | ||||||
Of which reservations on behalf of third parties | 670 | -28% | 933 | ||||||
Quarterly figures - Revenue
2022 | 2021 | 2020 | |||||||||
En millions d'euros | Q1 | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 | ||
Development | 699 | 1,279 | 815 | 827 | 851 | 1,747 | 703 | 680 | 524 | ||
Residential Real Estate development | 626 | 1,146 | 735 | 742 | 655 | 1,216 | 642 | 434 | 467 | ||
72 | 133 | 79 | 85 | 195 | 530 | 61 | 247 | 57 | |||
Services | 195 | 270 | 198 | 209 | 176 | 237 | 198 | 161 | 171 | ||
Property management | 92 | 94 | 100 | 94 | 91 | 95 | 99 | 84 | 91 | ||
Serviced properties | 49 | 47 | 40 | 35 | 35 | 34 | 35 | 30 | 35 | ||
Distribution | 54 | 129 | 58 | 80 | 50 | 108 | 65 | 47 | 45 | ||
Other activities | 1 | 1 | |||||||||
Revenue - New scope | 895 | 1,549 | 1,013 | 1,036 | 1,028 | 1,983 | 901 | 842 | 695 | ||
Revenue from disposed activities* | . | 107 | 104 | 134 | 120 | 88 | 92 | ||||
Revenue | 895 | 1,549 | 1,013 | 1,143 | 1,132 | 2,118 | 1,021 | 929 | 787 |
* Disposed activities are consolidated until 31 Mars 2021 for Century 21 and until 30
GLOSSARY
Time-to-market: Available market supply compared to reservations for the last 12 months, expressed in months, for new home reservations segment in
Business potential: The total volume of potential business at any given moment, expressed as a number of units and/or revenue excluding VAT, within future projects in
Current operating profit: Includes all operating profit items with the exception of items resulting from unusual, abnormal and infrequently occurring transactions. In particular, impairment of goodwill is not included in current operating profit
Development backlog (or order book): The Group’s already secured future revenue, expressed in euros, for its real estate development businesses (
EBITDA: Defined by
EBITDA after lease payments: EBITDA net of expenses recorded for lease payments that are restated to reflect the application of IFRS 16 Leases
Free cash flow: Cash generated by operating activities after taking into account tax paid, financial expenses, repayment of lease liabilities, changes in WCR, dividends received from companies accounted for under the equity method and net investments in operating assets
Gearing: net debt divided by consolidated equity
Joint ventures: Entities over whose activities the Group has joint control, established by contractual agreement. Most joint ventures are property developments (
Land bank: The amount corresponding to acquired land development rights for projects in
Leverage ratio: net debt before lease liabilities (IFRS 16) divided by EBITDA after leases on the last 12 months
Net profit before non-recurring items: Group share of net profit restated for non-recurring items such as change in fair value adjustments in respect of the ORNANE bond issue and items included in non-current operating profit (disposal of significant operations, any goodwill impairment losses, remeasurement of equity-accounted investments following the assumption of control)
New scope: Scope of consolidation excluding the contribution of disposed activities (Century 21 and Ægide-Domitys) and capital gains. Disposed activities have been consolidated until
Order intake – Commercial real estate: The total of selling prices excluding VAT as stated in definitive agreements for
Operational reporting: According to IFRS but with joint ventures proportionately consolidated. This presentation is used by management as it better reflects the economic reality of the Group’s business activities
Pipeline: sum of backlog and business potential; could be expressed in months or years of activity (as the backlog and the business potential) based on the last 12 months revenue.
Property Management: Management of residential properties (rentals, brokerage), common areas of apartment buildings (as managing agent on behalf of condominium owners), commercial properties, and services provided to users.
Reservations by value: (or expected revenue from reservations) –
Revenue: revenue generated by the development businesses from VEFA off-plan sales and CPI development contracts is recognised using the percentage-of-completion method, i.e. on the basis of notarised sales and pro-rated to reflect the progress of all inventoriable costs.
Serviced properties: the Group’s business activities in the management and operation of student residences as well as flexible workspaces.
1 Enabling the operating margin to be maintained at around 8.0%
2 Source: Observatoire Crédit Logement – Q1 2022
3 In a new home market expected to grow slightly (c.150,000 units)
Attachment
- PR Q1 2022 27042022 - VDEF
© OMX, source