Glenveagh Properties PLC Announces its Interim Results for 2022
Glenveagh Properties plc ("Glenveagh" or the "Group") a leading Irish homebuilder announces its Interim Results for the period ended 30 June 2022.
Results Highlights
- Continued strong operational performance with suburban completions +31% in H1 2022
- Strong private reservation rates per site (+25%) combined with seven new sales outlet openings have delivered closed units & a forward order book in Suburban of €588.1 million (+59%)
- All 1,400 Suburban units capable of closing in 2022 now closed or in contract
- Urban business transformed with over €310 million of total revenue across four projects signed to date in 2022 resulting in a reduction of land capital deployed in this segment to 12.8% of the Group’s total landbank
- Partnership’s business on track to deliver over 2,050 units for local authorities focused on social, affordable and cost rental homes with planning lodgements for both Oscar Traynor Road and Ballymastone expected in H2 2022
- Medium-term pipeline of home delivery across all business segments supported by five construction site openings in H1. 23 construction sites now active (31 Dec 2021: 18 sites) capable of delivering over 4,500 units, with four attractive sites added to the landbank in H1 for a total consideration of €15.7 million
- Conscious decision to support our long-term supply chain partners through a volatile cost environment resulting in CPI of 8%-9% in H1, with a broadly neutral impact on margin
- Execution against the Group’s offsite manufacturing strategy has transformed our internal delivery capabilities and innovation potential across timber frame and Light Gauge Steel (“LGS”) with the acquisition of Harmony Timber Solution Ltd. (“Harmony”) and our LGS manufacturing partnership now complete
- Continued delivery against our sustainability objectives with the publication of our Net Zero pathway on track for Q4 2022
- Continued disciplined capital allocation against clearly articulated priorities has enabled the completion of 75.1 million share repurchases (€87.2 million) in H1 with €50 million yet to be deployed under the current buyback programme
Outlook
The strength of the current market is demonstrated through our strong performance to date in 2022 and forward order book, which total €989.8 million. The closed units and forward order book in the suburban business of €588.1 million and 1,831 units gives good visibility on deliveries in both 2022 and 2023. The urban revenue recognised in 2022 and forward order book of €401.7 million relates to six projects that the business will deliver between 2022 and 2024.
Despite the near-term challenges of CPI and material availability, the Group are confident of delivering EPS for 2022 of between 7.5 cent to 8.5 cent.
Current land portfolio of approximately €490million gives strong visibility that we will materially surpass our land target of €500 million by year end providing significant efficiency for our Balance Sheet and further enhancing our Return on Equity.
Anticipated strong cash generation in H2 will result in low levels of net debt at year end, and excess cash being invested in line with the Group’s capital allocation policy which includes net leverage guideline of 15% of net assets.
Speaking today, Stephen Garvey, CEO said:
“We’re continuing to grow and scale our business successfully, while innovating and investing in sustainable manufacturing technology that will deliver the homes of the future that Ireland needs.
We’re dealing effectively with the challenges of disrupted supply chains, a volatile cost environment, and a planning system that’s contributing to the supply shortage rather than alleviating it.
I'm proud of the highly capable team we have that's delivering to such a high standard, with a relentless focus on sustainability, supply change integration, and a rigorous approach to the deployment of capital.
Looking ahead, while the Government’s First Home and Help to Buy schemes will provide much- needed support for homebuyers, they won’t be enough to solve Ireland’s accommodation crisis if planning policy and the planning system do not get the reform they need so urgently.”