Kaufman & Broad SA: 2024 Annual results
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Kaufman Broad SA
S Press release Press release Paris, 30 January 2025
2024 ANNUAL RESULTS
The group is thus in position to take full advantage of the recovery in a healthy market.
The rating agency Fitch Ratings confirmed at the end of August the ‘BBB-’ Investment Grade rating with stable outlook of Kaufman Broad SA. This rating has been constant since 2022. Fitch Ratings' confirmation of this rating highlights the strength of the group's financial structure.
For the full year 2025, the group's revenue is expected to increase by approximately 5%. The recurring operating income ratio is expected to be between 7.5% and 8.0%. The Group is expected to remain in a positive net cash position(a) after taking into account the payment of a dividend of €43.6M for fiscal year 2024, i.e. €2.20 per share, subject to approval by the Shareholders' Meeting of May 6, 2025. ‘
In 2024, housing reservations in value amounted to 1163.3 million euros (including VAT), compared to 1079.4 million euros over the same period in 2023, an increase of 7.8%. In terms of volume, they stood at 5,543 housing units in 2024, up 4.0% from 5,332 in 2023.
The program take-up period was 3.0 months on November 30, 2024 (over twelve months), down nearly 2 months compared to the same period in 2023 (4.8 months).
The commercial offering, with 97 per cent of units located in tight areas (A, ABIS and B1), amounted to 1,384 units on 30 November 2024 (2,114 units at the end of November 2023).
Customer Breakdown
Orders in value (including VAT) for first time buyers accounted for 17% of sales, compared to 11% over the same period in 2023. First time buyers accounted for 6% of sales in 2024, compared with 4% in 2023.
Orders made to investors accounted for 13% of sales (of which 7% for Pinel alone), compared with 13% at the end of November 2023 (of which 4% for Pinel alone). Block sales accounted for 65% of orders in value (including VAT), compared with 72% over the same period in 2023.
As of 30 November 2024, the commercial division recorded net bookings of 41.8 million euros (including VAT) compared to 33.7 million euros (including VAT) for the same period in 2023.
Kaufman Broad currently has 58,800 sq. m of office space and approximately 122,100 sq. m of logistics platform on the market. The group has 18,200 sq. m of office space and approximately 61,800 sq. m of logistics platform under study. In addition, 123,800 sq. m of office space and nearly 13,000 sq. m of logistics are currently under construction. Finally, the company has nearly 13,500 sq. m. of office space to be completed in DPM (delegated project management) to be signed.
As of 30 November 2024, Housing Backlog stood at 1,987.8 million euros (excluding of VAT) compared to 2,053.4 million euros (excluding of VAT) for the same period in 2023 and represented 26.3 months of activity compared to 25.7 months of activity at the end of November 2023. On November 30, 2024, Kaufman Broad had 114 housing programs under marketing, representing 1,384 housing units (131 programs and 2,114 housing units as at the end of November 2023).
The Land portfolio housing represents 30,272 units and is down 11.1% compared to the end of November 2023 (34,069 units). At the end of November 2024, it represented over 5 years of commercial activity. In addition, 89% of the housing portfolio is located in tense areas, representing 26,935 housing units as of 30 November 2024.
In the 1st quarter of 2025, the group plans to launch 19 new programs for 1,091 units, of which 8 in the Paris region representing 549 units and 11 in the Regions representing 542 units.
As of November 30, 2024, the Commercial property Backlog amounted to 509.2 million euros to be excluding VAT compared with € 622.6 million excluding VAT for the same period in 2023.
Total revenue amounted to 1076.8 million euros (excluding VAT), compared to 1409.1 million euros in the same period in 2023.
Housing revenue amounted to 908.0 million euros (excluding VAT), compared to 957.8 million euros (excluding VAT) in 2023. It represents 84.3% of the group's revenue.
Revenue from the Apartments business was 830.1 million euros (excluding VAT) (vs. 883.0 million euros (excluding VAT) at the end of November 2023). Revenue for the Commercial property division was 151.6 million euros (excluding VAT), compared to 437.5 million euros (excluding VAT) over the same period in 2023. Other activities generated revenues of 17.2 million euros (exclusive of tax) (including 8.3 million euros in revenue from the operation of student residences) compared to 13.8 million euros (excluding VAT) (including 7.4 million euros in revenue from the operation of student residences).
On November 30, 2024, gross profit amounted to 208.0 million euros, compared with 257.2 million euros in the same period in 2023. The gross margin was 19.3% compared to 18.3% in the same period of 2023.
Current operating expenses amounted to 127.3 million euros (11.8% of sales), compared to 147.9 million euros in the same period in 2023 (10.5% of sales). Current operating income amounted to 80.8 million euros, compared to 109.3 million euros in 2023. Current operating income stood at 7.5%, compared with 7.8% in 2023.
Operating profit amounted to 84.2 million euros, compared to 109.3 million euros in 2023.
At the end of November 2024, consolidated net income amounted to 57.8 million euros compared with the same period in 2023 when it amounted to 76.5 million euros. Non-controlling interests amounted to 12.8 million euros in 2024, compared with 16.3 million euros in 2023.
Attributable Net income was 45.0 million euros, compared with 60.2 million euros in 2023.
The positive net cash position (excluding IFRS 16 debt and Neoresid put debt) on 30 November 2024 was 397.6 million euros, compared with a positive net cash position (excluding IFRS 16 debt and Neoresid put debt) of 180.5 million euros at the end of November 2023. Cash and cash equivalents amounted to 502.9 million euros at 30 November 2024, compared with 350.0 million euros on November 30, 2023.
On 10 July, Kaufman Broad set up a new 200 million euros syndicated loan agreement. With an initial maturity of 5 years, this loan replaces the 250 million euros ‘RCF 2019’ syndicated loan agreement maturing in January 2025. The implementation of this corporate line will allow the company to extend the maturity of its resources, while giving it flexibility of use according to needs and opportunities, in addition to its available cash.
Working capital requirements amounted to 289.2 million euros at 30 November 2024, or -26.9% of sales, compared with 80.8 million euros at 30 November 2023 or -5.7% of sales.
Finally, the rating agency Fitch Ratings confirmed last August the ‘Investment Grade’ - ‘BBB-’ rating with stable outlook of Kaufman Broad S.A. This rating has been constant since 2022. For Fitch Ratings, the confirmation of the rating reflects Kaufman Broad's solid business and financial profile, which proves resilient during periods of weak demand. Fitch also points out that Kaufman Broad continues to maintain a positive net cash position, which comfortably covers all future debt maturities.
The Board of Directors of Kaufman Broad SA will propose to the Shareholders' Meeting of 6 May 2025 the payment of a dividend of €2.20 per share.
For the full year 2025, Group revenue is expected to increase by around 5%. The recurring operating income ratio is expected to be between 7.5% and 8.0%. The Group is expected to remain in a positive net cash position(a ) after taking into account the payment of a dividend of €43.1M for 2024, i.e. €2.20 per share, subject to approval by the Shareholders' Meeting of May 6, 2025.
(a) excluding IFRS 16 and Put Neoresid debt
This press release is available at www.corporate.kaufmanbroad.fr
Glossary
Backlog or (order book ) : it covers, for Sales in the Future Completion Status (VEFA), undelivered reserved units for which the notarially signed deed of sale has not yet been signed and undelivered reserved units for which the notarially signed deed of sale has been signed up to the portion not yet taken into revenue (on a 30% advanced program, 30% of the revenue of a housing for which the notarially signed deed of sale has been recorded as revenue, 70% are included in the backlog). The backlog is a summary at a given point in time that makes it possible to estimate the revenue still to be recognised in the coming months and thus support the Group's forecasts - it being specified that there is an uncertain portion of the transformation of the backlog into revenue, particularly for bookings not yet recorded.
Leases in future state of completion (BEFA): Leases in future state of completion consists for a user to rent a building even before its construction or its restructuring.
Working Capital Requirement (WCR): This arises from cash flow mismatches: disbursements and receipts corresponding to operating expenses and revenues required for the design, production and marketing of real estate programs. The resulting simplified expression for WCR is as follows: these are current assets (inventory + trade receivables + other operating receivables + advances received + prepaid income) less current liabilities (trade payables + tax and social security payables + other operating liabilities + prepaid expenses). The size of the WCR will depend in particular on the length of the operating cycle, the size and duration of storage of work-in-progress, the number of projects launched and the payment terms granted by suppliers or the profile of payment schedules granted to customers.
Free cash flow: free cash flow is equal to cash flow from operations after changes in working capital and tax paid less net capital expenditure for the year.
Operating cash flow or cash flow from operating activities is equal to cash flow from operating activities after working capital and tax paid.
Cash flow: Cash flow from operations after cost of debt and tax is equal to consolidated net income adjusted for the share of income from associates, joint ventures and operations in the process of disposal and calculated income and expenses.
Financial resources: corresponds to cash and cash equivalents plus undrawn credit lines at date
CDP : (formerly Carbon Disclosure Project): Measuring the environmental impact of companies.
Take-up rate : the run off period for inventories is the number of months required for available homes to be sold if sales continued at the same pace as in previous months, being the outstanding housing (available offer) per quarter divided by the reservations per quarter elapsed themselves divided by the number of quarters of the period of reservations considered.
Dividend The dividend is the portion of the Company's net annual profit distributed to shareholders. Its amount, proposed by the Board of Directors, is submitted to the shareholders for approval at the General Meeting. It is payable within a maximum of 9 months after the end of the financial year.
EBIT: The EBIT corresponds to the operating income for the period, calculated at the gross margin deducted by operating costs for the current period.
Gross financial debt or financial debt: The gross financial debt is composed of long-term and short-term financial liabilities, hedging financial instruments relating to liabilities composing the gross financial debt, and interest accrued on line items in the balance sheet which constitute the gross financial debt.
Net indebtedness or net financial debt: The net debt of a company is the balance of its gross financial debts on the one hand, and its cash and financial investments forming its “active cash” on the other hand. It represents the credit or debit position of the company vis-à-vis third parties and outside the operating cycle.
Investment grade : investment grade means that a financial instrument or a company has a relatively low risk of default.
EHU: the EHU (Equivalent Housing Units delivered) are a direct reflection of the activity. The number of ‘LEU’ is equal to the product (I) the number of housing units in a given program for which the notarial signed deed of sale has been signed and (II) the ratio of the amount of land expenditure and construction expenditure incurred by the group on the said program to the total expenditure budget of the said program.
Gross margin: corresponds to revenues less cost of sales. The cost of sales includes the price of land, related land costs and construction costs.
Commercial offer: it is represented by the sum of the stock of housing available for sale on the date in question, i.e. all the housing units not reserved on that date (minus the unopened commercial units).
Land portfolio : This includes land to be developed. I.e. land for which a deed or a promise to sell has been signed, as well as land under study, i.e. land for which a deed or promise to sell has not yet been signed.
Debt-to-equity ratio (or Net gearing): This is the ratio of net debt (or net financial debt) to the company's consolidated equity. It measures the risk of the company’s financial structure.
Orders: measured in volume (Units) and in value, they reflect the group’s commercial activity. Their inclusion in revenues is conditional on the time required to transform a reservation into a notarized deed of sale, which generates the income statement. In addition, in multi-family housing programs including mixed-use buildings (apartments, business premises, shops, offices), all surfaces are converted into housing equivalents.
Orders (in value) : They represent the value of the real estate from the signed reservation contracts including all taxes for a given period. They are mentioned net of the withdrawals noted during the said period.
Managed housing: Managed residences, or service residences, are real estate complexes made up of housing (Houses or apartments) for residential use offering a minimum of services such as reception, supply of linen, cleaning and maintenance of housing as well as the provision of breakfast. There are several types of residences: Student residences are apartment complexes, mostly studios equipped with a kitchenette and furnished, located close to schools and universities and close to public transport; tourist residences, located in high potential tourist areas, offer in addition to the usual services of infrastructures such as swimming pools, sports grounds, sometimes saunas, hammams, whirlpool baths, children's club; business residences are an alternative to traditional hotels, consisting of studios (approximately 80%) and 2-rooms, located in the city centers or near important business centers and systematically well served; finally, senior residences (including also residences for dependent or non-dependent elderly people - Ehpad), which make it possible to anticipate the aging of the population, accommodating people from 55 years and beyond; their clientele is mixed: Tenants and owners.
CSR (Corporate Social Responsibility): Corporate Social Responsibility (CSR) is the contribution of companies to the challenges of sustainable development. The approach consists of companies taking into account the social and environmental impacts of their activity in order to adopt the best possible practices and thus contribute to the improvement of society and the protection of the environment. CSR makes it possible to combine economic logic, social responsibility and eco-responsibility (definition of the Ministry of Ecology, Sustainable Development and Energy).
SBTi : the Science Based Targets initiative is an international organisation that contributes to companies' commitment to combating global warming, in particular by assessing and validating their climate targets.
Scope 1, 2 and 3: scope 1: Direct greenhouse gas emissions (including vehicle fuel) ▪ Scope 2: Indirect energy related greenhouse gas emissions ▪ Scope 3: Other indirect emissions (including production and use of our production).
Sell-Through rate: The Sell-Through rate (Rst) represents the percentage of initial inventory that sells monthly on a real estate program (sales/month divided by initial inventory); i.e., monthly net reservations divided by the ratio of beginning-of-period inventory plus end-of-period inventory divided by two.
EBIT rate (or COI) rate: Expressed in percentages, corresponding to the operational income so far with operational costs to-date deducted from gross margin, divided by the turnover
Cash and cash equivalents: This corresponds to cash and cash equivalents on the assets side of the balance sheet, i.e. all cash on hand (available banks and cashiers), marketable securities (short-term investments and term deposits) and reserve balances.
Net cash: It corresponds to ‘negative’ net debt, or ‘negative’ net financial debt, as for the company the balance of cash and financial investments forming its ‘active cash’ is greater than the amount of its gross financial debts (or gross financial debt).
Units: Units define the number of dwellings or dwelling equivalent (for mixed programs) of a given program. The number of housing equivalent units is determined by relating the surface area by type (business premises, shops, offices) to the average surface area of the housing units previously obtained.
Sale in completion (VEFA): The Sale in the Future State of Completion is the contract by which the seller transfers immediately to the purchaser his rights on the ground as well as the property of the existing constructions. The future works become the property of the purchaser as they are executed; the purchaser is obliged to pay the price as the works progress. The seller retains the powers of the project owner until the work is accepted.
APPENDICES
Primary consolidated data
(1 ) Ebit corresponds to current operating income cad at gross margin less current operating expenses. (2 ) Based on the number of shares comprising the share capital of Kaufman Broad S.A, i.e. 19,862,022 shares at 30 November 2024 and 2023. (3 ) including 8.3 million euros in revenue from the operation of student residences at 30 November 2024 and 7.4 million euros at 30 November 2023.
Consolidated income statement
* Information not audited and not approved by the Board of Directors
Consolidated balance Sheet
* Information not audited and not approved by the Board of Directors
Regulatory filing PDF file File: KBSA_PR annual 2024_VFinale |
2078391 30-Jan-2025 CET/CEST
