RCS - Neinor Homes - Full Year Results 2022

Neinor Homes SAAnnouncement

23/02/2023 08:16

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RNS Number : 8277Q  Neinor Homes  23 February 2023

 

Neinor Homes Full Year results 2022

A robust financial performance with standout Q4; positive outlook for 2023

 

Madrid, February 23, 2023- Neinor Homes ("Neinor" or "the company") has
published its results for the 2022 financial year, presenting a robust
performance despite a challenging operating environment, including a fourth
quarter that looks set to be one of the best in the company's history.

Full Year highlights:

▪      Delivery of 2,743 homes, generating €146 million of EBITDA and
€101 million net income, in line with 2022 guidance

▪      Strong full year performance drove €765 million in revenues

▪      €100 million dividend paid out, reflecting continued
confidence in the outlook for the business (12% yield).

▪      €324 million of net debt in 2022, down €53 million from 2021

▪      Highly disciplined land strategy saw Neinor acquire land plots
comprising c. 1,200 units worth €30 million

▪      Land bank stood at c15,500 units by year end - second largest in
its history

▪      In the Q4 2022 the company maintained a good commercial
performance achieving pre-sales of 582 units - the best quarterly performance
in 2022

▪      Cancellation rates remained at historical lows (c.1%)

▪      Strong performance from rental business reflected by 97%
occupancy and rental growth of 15%

▪      Today, Neinor is launching a voluntary tender offer over its
Green Bond (€300 million, 4.5% fixed coupon maturing in 2026) of up to
€100 million and potential savings of €25 million

▪      Expect broadly similar operational and financial performance in
2023 with 2,500-3,000 deliveries and EBITDA of €140-160 million

 

The company delivered a strong operational and financial performance in FY22,
demonstrating its strong market position. Neinor ended the year with the
delivery of 2,743 homes and revenues of €765 million.

The company reported €146 million of EBITDA for the full year and €101
million of net income in 2022.

During 2022, Neinor returned €100 million in the form of dividends to its
shareholders, the highest in the company's history and reflecting management's
continued confidence in the business. In addition, it complemented its
shareholder return plan with a share buyback program of approximately €20
million.

As at 31 December 2022, Neinor maintains a conservative net debt position of
€324 million, an annual improvement of €53 million, with a leverage ratio
of 19%.

Neinor also announces that it is launching a voluntary bond tender of up to
€100 million. The minimum price of 90% nominal value implies a potential
saving of up to €25 million. The Group remains well-protected from higher
interest rates with fixed rates until 2026.

Commercial activity remains dynamic

Despite macroeconomic and geopolitical uncertainty, the residential developer
registered 1,888 new sales during 2022 and ended the year with a forward
orderbook of 2,056 units. This figure amounts to more than €500 million in
future revenues and represents sales coverage of 71% for 2023. In addition,
cancellation rates remain at historically low levels of c.1%, suggesting
rising interest rates and mortgage costs are having a limited impact on
consumer confidence and customer access to mortgages

With regard to its investment activity, Neinor maintained its highly
disciplined strategy throughout 2022, acquiring land plots comprising
approximately c. 1,200 units worth €30 million. Neinor ends the year with
the second largest land bank in its history with approximately 15,500 homes.

A solid Build-to-Rent (BTR) business positioned for growth

Neinor Homes' rental business continued its solid operating performance in
2022, which is reflected at year-end by an occupancy rate of 97%, as well as
rental growth of 15% for the 156 contracts renegotiated in the current year.
During 2022, Neinor delivered its second BTR development with a total of 213
units; Sky Homes in Valencia. In late 2022, Neinor announced the sale of
Hacienda Homes, a 146-unit BTR project located in Malaga with an occupancy of
96% and c.€1.5 million passing GRI.

By December 2022, Neinor had 3,120 units in different stages of development to
be delivered over the next three years, reinforcing its leading position in
the Spanish BTR segment. By year end, Neinor's rental portfolio comprised
3,875 units with an expected GRI above €43 million and valuation that
exceeds €900 million Gross Asset Value (GAV).

 

Borja García-Egotxeaga, CEO of Neinor Homes, said:

"Spain today is one of the most attractive and safest residential markets in
the world. It is deeply undersupplied, underleveraged and underpriced as house
prices remain 14% below Global Financial Crisis levels. We anticipate pricing
remaining firm, particularly for new housing, as supply fails to catch up with
demand. The sector fundamentals remain strong with the growth outlook for the
Spanish economy in 2023 and 2024 pointing towards an average growth of 1.5%,
significantly above other European countries. As a leading residential
platform in Spain located in the top six regions of Spain where demand is
highest, we are well-positioned to benefit from this growth."

 

Jordi Argemí, Deputy CEO and Chief Financial Officer of the Group, added:

"We are proud of what we have achieved over the last four years - particularly
in light of the challenging economic climate and Covid-19 pandemic, with 8,817
new homes delivered to our customers translating into more than €500 million
in EBITDA and beating our guidance Furthermore, in anticipation of monetary
policy tightening we took mitigating actions and acquired interest rate caps
to fully cover our exposure until 2026 for a scenario with Euribor above 2%.
Today we are launching a voluntary bond buyback of up to €100mn after we
purchased already €27mn in the market. Altogether, these three measures
could generate potential savings of €43mn."

 

- Ends -

For further information:

Powerscourt

Nick Dibden / Victoria Heslop / Oliver Banks

neinorhomes@powerscourt-group.com

 

 

Neinor Homes

Investor Relations Department

investor.relations@neinorhomes.com

 

 

About Neinor Homes

Neinor Homes is the leading residential platform in Spain, with a land bank to
develop close to 15,500 homes, and a GAV as of December 2022 of €1.7bn. This
land bank is located in the most dynamic regions with the best economic
fundamentals in Spain: Madrid, Western and Eastern Andalusia, Levante, Basque
Country and Catalonia. Neinor is the only platform with a 360º offer,
covering the entire value chain of the development and rental business. In
addition, it complements its activity with a services division that has
extensive knowledge in urban management, delegated development and
construction. In 2022, Neinor was recognized for the second consecutive year
as the developer with the lowest ESG risk in the world by Sustainalytics,
being the first company out of a total of 284.

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