2017 FIRST HALF RESULTS AND OUTLOOK JULY 12, 2017

Transcription

1 2017 FIRST HALF RESULTS AND OUTLOOK JULY 12, 2017

2 HIGHLIGHTS

3 HIGHLIGHTS Strong sales results Increase in housing orders of almost 17% 1.5 months decrease in the take-up period 18% increase in the land reserve, and 22% increase in the Housing backlog Two tenders awarded in the Offices segment (Bordeaux and Lille) Signing of three off-plan leases in the Logistics segment Commercial property: potential orders amounting to between 150 and 200 million over the next 6 to 9 months 3

4 HIGHLIGHTS Marked improvement in the quality of the financial structure 150 million Euro PP bond placement with institutional investors in Europe > Maturity of the debt extended by more than two years 74% uptake rate for the share-based dividend payment option > Strengthened shareholders equity Increased financial capacity, which now amounts to around 290 million Upgrade to the annual outlook for 2017 New Housing market: growth of around 5% compared with 2016 Kaufman & Broad: consolidated revenues up by at least 10% compared with

5 HIGHLIGHTS Finalization of the share capital restructuring: the employees are now Kaufman & Broad s largest shareholder On March 31, % Free float Predica Nobel Fund PAI Partners On June 30, % 1.4% 1.4% 10.2% 8.0% 77.1% KBSA Employee Savings Plan Artimus Participations* 1.3% 0.9% 6.0% Kaufman & Broad S.A. *Senior Executives and employees of Kaufman & Broad 5

6 HOUSING BUSINESS

7 OUR VIEW OF THE NEW-BUILD HOUSING MARKET 2016 orders: 125,000 housing units > Outlook for 2017 (in January 2017): 2017 orders: 2016 Outlook for 2017 (in > July 2017): 2017 orders: +5% compared with 2016 Favorable factors Neutral and/or waitand-see factors Demographic factors (population growth, people living apart, and longer life expectancy, etc.) Attractive, inexpensive and socially cohesive tax arrangements (Pinel and PTZ, etc.) Household confidence is at its highest level for 10 years (INSEE) Relatively stable sale prices Relatively stable property prices (despite local housing shortages) Slow increase in mortgage rates from historically low levels Shortage factors Lack of visibility regarding the extension of the arrangements aimed at supporting investment and home ownership 7

8 THE BENEFITS OF THE PINEL ARRANGEMENTS Undertaking to rent for a period of 6, 9, or 12 years at a rent that is lower than the market average, and to tenants whose income is capped Tax reduction of 12%, 18%, or 21% in exchange The value of the investment is capped at 300,000 Construction of highly energy-efficient (RT 2012) housing units Profitable tax arrangement for the Government*: cost of the tax subsidy: 1.6 billion revenues: 2.2 billion *Source: FPI 8

9 THE NF HABITAT ARRANGEMENTS NF Habitat certification is the cornerstone of Kaufman & Broad s Quality, Environment, and Innovation approach A certificate that showcases the key attributes of the housing unit, including a single set of multi-criteria guidelines for all types of housing units Four commitments: Responsible management where the Project Manager is concerned Quality of life Protecting the environment Economic efficiency Kaufman & Broad is one of the rare developers to be certified for all of its operations 9

10 CONTINUED GROWTH MOMENTUM > Orders (No. of units) > Take-up period (months) -1.5 months +16.6% H H > Property portfolio (No. of units) +18.1% H H H H > Backlog ( million, excluding VAT) +21.9% End of May 2014 End of May 2015 End of May 2016 End of May 2017 End of May 2014 End of May 2015 End of May 2016 End of May

11 EXPANSION OF THE PROPERTY PORTFOLIO Property portfolio - No. of units 20,174 CAGR OF 11% 20,236 23, % 27,296 > Expansion of the land bank at a controlled cost, in line with our customers purchasing power End of May 2014 End of May 2015 End of May 2016 End of May

12 INCREASE IN HOUSING UNIT ORDERS Orders in volume and value terms No. of units million, including VAT CAGR of +17% 8,017 5,871 6,901 1, % 1,128 1,212 3, , H H

13 DECREASE IN THE TAKE-UP PERIOD Take-up period in months 8.0 H months 6.3 H H H > The decrease of the take-up period reflects the fast marketing of programs that are appropriate for the demand and our customers finances 13

14 STRONG BUSINESS OUTLOOK Housing Backlog million, excluding VAT 1,007 CAGR of +14 % +21.9% 1,488 1,220 1,075 > The increase in the Backlog over time underlines the business growth prospects End of May 2014 End of May 2015 End of May 2016 End of May

15 COMMERCIAL PROPERTY BUSINESS

16 OFFICE DEVELOPMENT IN ILE DE FRANCE AND THE FRENCH REGIONS ORA Porte Pouchet Building 26,000 sq.m. Bordeaux Euratlantique 26,000 sq.m. Bordeaux: Bassins à Flot Project 5,000 sq.m. Inter-administrative Center in St Brieuc 8,775 sq.m. EDF Commerce Sud-Ouest s Head Office in Bordeaux 4,500 sq.m. Lille Eurasanté 7,000 sq.m. Clichy 7,500 sq.m. IA9B Building, 23,000 sq.m. Paris Left Bank Development Zone (ZAC) SNI s future Head Office Arcueil Austerlitz Paris Left 10,000 sq.m. Bank 70,000 sq.m

17 OFFICES: THREE MARKETING PROGRAMS ARE UNDERWAY EPA Bordeaux Euratlantique Offices, 26,000 sq.m. Delivery in Q Arcueil Offices - 10,000 sq.m. Delivery in 2021 Lille Eurasanté Offices 7,000 sq.m. Delivery in mid

18 LOGISTICS: SIGNING OF THREE OFF-PLAN LEASES Three large projects covering a total surface area of almost 150,000 sq.m. are currently being marketed Châtres (Seine-et-Marne): 37,000 sq.m. Montbartier (Tarn-et-Garonne): 72,000 sq.m. Leon (Spain): 33,000 sq.m. 18

19 OUTLOOK FOR THE COMMERCIAL PROPERTY BUSINESS Development potential measured as a land bank: around 350,000 sq.m. Corporate property: 142,000 sq.m. Logistics: 205,000 sq.m. Potential order volume over the next 6 to 9 months: 150 to 200 million 19

20 FINANCIAL RESULTS

21 REVENUES million +9.2% million <1% Housing 86% Other: 2.7 million compared with 3.0 million Apartments: million vs billion Single-family homes in communities: 18.0 million vs million Commercial property 14% Commercial property*: 87.0 million vs million S S *Offices, retail premises, hotels, and logistics 21

22 FROM REVENUES TO OPERATING INCOME In million (507.8) (19.1% of revenues) (71.1) 48.8 (7.8% of revenues) Revenues Cost of sales Gross margin Current operating expenses Operating income 22

23 OPERATING MARGINS Gross Margin (As a % of revenues) Current Operating Margin (As a % of revenues) Adjusted EBIT* (As a % of revenues) 19.1% 19.0% 19.0% 19.1% 8.1% 8.2% 7.9% 7.8% 8.7% 8.8% 8.6% 8.3% H1 H H1 H H1 H * Income from current operations restated for capitalized borrowing costs 23

24 FROM OPERATING INCOME TO NET INCOME 48.8 (+6.8% vs. H1 2016) (2.1) In million (13.4) (0.2) 33.1 (+13.2% vs. H1 2016) (12.9) 20.2 (+11.0% vs. H1 2016) Operating income Cost of net financial debt Tax Attributable Consolidated income equity net income affiliates and joint ventures Noncontrolling interests Attributable net income 24

25 SUMMARY BALANCE SHEET AT THE END OF MAY 2017 In million ASSETS LIABILITIES Noncurrent assets Equity capital Working Capital Non-current liabilities Net financial debt

26 CHANGE IN WORKING CAPITAL In million % of revenues 10.3% of revenues 8.7% of revenues 10.4% of revenues* 10.4% of revenues* 10.2% of revenues Working Capital at the end of 2013 Working Capital at the end of 2014 Working Capital at the end of 2015 Working Capital at the end of 2016 Working capital at the end of May 2016 Working capital at the end of May 2017 *On a 12-month rolling basis 26

27 STRENGTHENING OF THE FINANCIAL STRUCTURE 150 million Euro Euro PP bond placement with institutional investors in Europe A 50 million 7-year tranche A 100 million 8-year tranche 100 million refinancing of the existing bank debt Extension of the average maturity on the debt (from 4.3 years at the end of 2016 to 6.2 years at the end of May 2017) Increased financial resources in order to support growth 74% uptake of the share-based dividend option Cancellation of 947,156 treasury shares in order to keep the total number of shares identical on a fully-diluted basis 28 million improvement in cash and shareholders equity Increased financial capacity ( million compared with million at the end of 2016) 27

28 FINANCIAL STRUCTURE In million May 31, Nov 2016 Equity capital Financial debt* Of which financial debt maturing in < 1 year Of which financial debt maturing in > 1 year Maturity 6.2 years 4.3 years * of which: Loan issuance costs (2.4) (3.1) Bilateral facilities, hedging instruments, and other Bond loan A + B facility Cash and cash equivalents Financial capacity

29 OUTLOOK

30 INSEE POPULATION GROWTH SCENARIO Increase in the population of Mainland France between 2007 and 2017: +3.4 million people (63.6 million to 67.0 million) Expected population growth between 2017 and 2040: Low-growth scenario: +1.9 million Median-growth scenario: +5.5 million High-growth scenario: +9.6 million out of the last 5 INSEE scenarios in the past 25 years have underestimated population growth Accordingly, the 2015 population was at the level of 4 of the 5 high-growth scenarios up since

31 PINEL ARRANGEMENTS: KAUFMAN & BROAD S LAND BANK IS PRIMARILY LOCATED IN AREAS WHERE THERE IS A HOUSING SHORTAGE Housing shortage areas in the Pinel arrangements: Abis, A, B1 Kaufman & Broad s land bank at the end of May 2017: 97% in housing shortage areas 31

32 OUTLOOK FOR 2017 Consolidated revenues: growth of at least 10% Gross margin ratio: around 19% Adjusted EBIT ratio 1 : around 8.5% Net financial debt: < 80 million 1 Corresponds to income from current operations restated for capitalized borrowing costs 32

33 IMPORTANT NOTICE The Kaufman & Broad Registration Document was filed with the French Financial Markets Authority ( AMF ) under No. D on March 31, It is available on the AMF ( and Kaufman & Broad ( websites. It contains a detailed description of Kaufman & Broad s business activities, results, and prospects, as well as of the related risks 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 document 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. 33