4 July 2024
Glenveagh Properties
plc
H1 Trading Statement
2024
Strong progress made with over 800
completions and 22% growth in closed and forward order book; on
track to deliver full year EPS guidance
Glenveagh Properties plc ("Glenveagh" or the
"Group") is today issuing a trading update for the six months ended
30 June 2024 ahead of the publication of its H1 2024 results on 5
September 2024.
H1 2024
Performance Summary
· Over
800 units of the 2,700 full year target completed in H1 2024 (H1
2023: 333)
·
Strong closed and forward order book of €1172m across our
three business segments, increasing by 22% from €963m as at our AGM
Trading Update on 2 May 2024. The closed and forward order book in
the Suburban business of €710m, comprising 2,057 units, gives
strong visibility on deliveries and revenue in H2 2024
· H1
revenue of approximately €150m (H1 2023: €172m). Urban performance
reflected the completion of 510 units from existing forward fund
transactions, where approximately 90% of revenue has already been
recognised in prior periods. Suburban completions of 294 units (H1
2023: 333) were impacted by the scheduling of closings, which are
now occurring early in the third quarter. Partnerships segment
revenue was in line with expectations
·
Suburban gross margin now expected to be in excess of 20% in
FY 2024, compared to an underlying margin of 19.3% in FY 2023,
driven by our enlarged scale, increased standardisation of product
and processes, and continued integration of
manufacturing
·
Partnership sites comprising over 2,000 units now operating
at scale, with revenue and profit to accelerate in H2 due to strong
construction progress. A third Partnerships contract is now subject
to final legal agreement, and we are in advanced negotiations on a
fourth agreement, which combined will add approximately 1,000 units
to our Partnerships pipeline
·
Placed on the LDA framework panel to accelerate the delivery
of mixed tenure homes. In advanced negotiations with LDA to
commence the activation of our Urban portfolio in Cork Docklands
via a forward fund transaction, with additional LDA partnership
opportunities possible over time
·
Progressing with forward fund transactions on two urban
developments totalling 260 units, including the transaction noted
in our AGM Trading Update in May
·
Strong planning momentum with permissions granted for
approximately 1,300 units in H1 with over 95% of units targeted for
FY 2025 now with planning permissions granted
· Net
debt increase as anticipated to approximately €250m (H1 2023:
€182m), driven by increased WIP investment which will unwind as
unit deliveries accelerate in H2
Outlook
· FY
2024 is a milestone year of growth for Glenveagh. Our strong
forward order book, operational momentum, and continued progress in
manufacturing underpins our full year EPS guidance which
anticipates a more than doubling of EPS to approximately 17 cent
(FY 2023: 8 cent), and Return on Equity target of approximately
15%
· We
continue to invest in accordance with our capital allocation
priorities, notably in land where we are now seen as the partner of
choice for landowners in attractive Suburban and Partnership led
locations. A number of significant land transactions are now being
explored in this regard
·
These acquisition opportunities, should they materialise, are
in highly attractive locations that are fully aligned with the
ambitions of national and regional planning policy. These will also
underpin long-term operational growth and optimal returns for
shareholders, supported by our resolute focus on enhancing Return
on Equity and our commitment to manage the size of the landbank to
below €400m over the long term. Once our capital allocation
priorities are satisfied, we remain committed to returning any
excess cash identified to shareholders
CEO Stephen
Garvey commented:
"We continue
to make excellent progress across our business and are firmly on
track to meet our objectives for the year.
Our
performance provides further evidence of our key strengths and
capabilities - our planning and design expertise; our skilled and
motivated workforce; our state-of-the-art vertically integrated
manufacturing operation; and our ability to enhance and accelerate
housing delivery at scale through greater standardisation while
optimising modern methods of construction.
The targeted
industry initiatives implemented by the Government via Housing For
All has provided much momentum to new home output across the market
delivering approximately 35,000 units per annum and strong
commencement growth in 2024. Yet as we continue to scale up our
activities and deliver more homes at pace, it is more important
than ever that we build on the initiatives already in place and
implement the structures required for the market to deliver over
50,000 units per annum. We know the enormous potential there is for
advancing quality housing delivery through collaborative State and
private sector projects, working in tandem with shared objectives,
and the collective deployment of resources and
capital.
Glenveagh's
ability to deliver great value, high-quality, sustainable homes at
scale via our innovative and proven vertically integrated operation
positions the business at the forefront of meeting the needs of a
growing economy and rapidly expanding population, supported by
motivated legislators and a strong fiscal
position."
For further
information please contact:
Investors:
|
Media:
|
Glenveagh
Properties plc
Michael Rice (CFO)
Jack Gorman (Head of IR and Corporate
Affairs)
investors@glenveagh.ie
|
Gordon
MRM
Ray Gordon 087 241 7373
David Clerkin 087 830 1779
glenveagh@gordonmrm.ie
|
Notes to
Editors
About Glenveagh Properties
plc
Glenveagh Properties plc, listed on Euronext
Dublin and the London Stock Exchange, is a leading Irish
homebuilder.
Supported by innovation and supply chain
integration, Glenveagh is committed to opening access to
sustainable high-quality homes to as many people as possible in
flourishing communities across Ireland. We are focused on
three core markets - suburban housing, urban apartments and
partnerships with local authorities and state agencies.
www.glenveagh.ie
Forward-looking
statements
This announcement does not constitute or form
any part of an invitation to underwrite, subscribe for or otherwise
acquire or dispose of any shares of Glenveagh Properties plc (the
"Company" or "Glenveagh").
This announcement contains statements that are,
or may be deemed to be, forward-looking statements. Forward-looking
statements include, but are not limited to, information concerning
the Company's possible or assumed future results of operations,
plans and expectations regarding demand outlook, business
strategies, financing plans, competitive position, potential growth
opportunities, potential operating performance improvements,
expectations regarding inflation, macroeconomic uncertainty,
geopolitical tensions, weather patterns, the effects of competition
and the effects of future legislation or regulations.
Forward-looking statements include all statements that are not
historical facts and can be identified by the use of
forward-looking terminology such as "may", "will", "should",
"expect", "anticipate", "project", "estimate", "intend",
"continue", "target", "ensure", "arrive", "achieve", "develop" or
"believe" (or the negatives thereof) or other variations thereon or
comparable terminology. Forward-looking statements are prospective
in nature and are based on current expectations of the Company
about future events, and involve risks and uncertainties because
they relate to events and depend on circumstances that will occur
in the future. Although the Company believes that current
expectations and assumptions with respect to these forward-looking
statements are reasonable, it can give no assurance that these
expectations will prove to be correct. Due to various risks and
uncertainties, actual events or results or actual performance of
the Company may differ materially from those reflected or
contemplated in such forward-looking statements. You are cautioned
not to place undue reliance on any forward-looking
statements.
These forward-looking statements are made as of
the date of this document. The Company expressly disclaims any
obligation to update these forward-looking statements other than as
required by law.
The forward-looking statements in this
announcement do not constitute reports or statements published in
compliance with any of Regulations 6 to 8 of the Transparency
(Directive 2004/109/EC) Regulations 2007 (as amended).