Very strong year for Glenveagh with revenues of over €84m

Company announces €50m investment in two Kildare sites

Leading Irish homebuilder Glenveagh Properties PLC, which is listed on the Dublin and London stock exchanges, has described 2018 as a year of significant growth.

Glenveagh’s annual results show that revenues for 2018 rose sharply to €84.2m, based on sales of 275 units for €79m and land sales of €5m.  The company reported a net loss of €3.56m for the year after posting a loss of €51.78m for the last five months of 2017, when the company first floated.  Gross profit for the year was €15.3 million, with a gross margin of 18.2%. The company is targeting a 20% margin in 2020.

During the year the company was actively building on 15 sites with over 1,100 units under construction. The majority of these units were in developments aimed at first time buyers, a market that continues to generate strong demand.  It is currently selling from 11 sites with 451 units sold, signed or reserved as of March 5th.

Since the company’s IPO it has invested €615m in site acquisitions and its landbank now stands at more than 12,600 units. Today it announced that it had exchanged contracts to acquire two sites off market for approximately €50m.  Known as ‘Project Arrow’ and located at Leixlip and Newbridge in County Kildare the properties have full planning permission for 793 units.

Commentary

Glenveagh’s co-founder and CEO Justin Bickle said the company exceeded its key targets in 2018 and had gotten off to a fast start in 2019;  “2018 was a very strong year at Glenveagh. We were delighted to exceed our key targets, selling 275 homes in our first full year’s trading, against our 250 goal, and we continued to add new sites to our attractive and flexible land portfolio. The firm foundations we laid during the year gave us significant momentum heading into 2019 and position us favourably for long term success. 2018’s achievements were the product of considerable hard work by many people across our organisation and support from our industry partners.

We remain very confident about the residential market backdrop in Ireland, as well as our ability to execute on our business plan. 2019 is off to a fast start, after two months of trading we already have 451 homes signed, closed or reserved while the Project Arrow acquisition announced today proves that our team are able to source and execute accretive land acquisitions off-market.

We believe that our focus on starter-homes in the private Build-to-Sell segment, private rental opportunities (PRS) across our business, and Mixed-Tenure schemes for local authorities is the right one to allow us to become a profitable and resilient homebuilder across the cycle. Our commitment to health and safety, customer service and product innovation is central to our mission. We are very proud to be named one of Ireland’s Great Places to Work and the only homebuilder to receive such recognition in this year’s awards. We thank our shareholders for their ongoing support.”

Construction & Sales Progress

Works have commenced at Maryborough Ridge (Mount Woods), Kilcock (Ledwill Park) and Blackrock Villas, all of which are delivering units in 2019 / early 2020. Further site openings for 2019 will include Stamullen, Hollystown and Leixlip.

Sales for 2019 are off to a strong start but the 451 unit figure mentioned earlier  sold, does not include the company’s Herbert Hill development (90 units) which it expects to dispose of as a single transaction later in 2019. 2019 sales will benefit from a number of factors including:

  • five new site launches at Knightsgate, Semple Woods, Ledwill Park, Mount Woods and Blackrock Villas;
  • the prospective sale of our Herbert Hill development;
  • full-year of show home availability at Taylor Hill and Cluain Adain;
  • our Marina Village show apartments in Greystones opening in H1; and
  • units available to our sales team earlier in the period due to strong construction progress.

Outlook

 Glenveagh’s market backdrop remains very favourable with significant demand for housing, particularly starter-homes.

With a significant portion of the company’s costs agreed and 451 units sold, signed or reserved, the company says it has strong visibility on delivering its sales target of 725 units for 2019.

Financial Highlights

  • Revenues of c. €84m inclusive of 275 units sales totalling €79m and land sales of €5m;
  • Gross margin of €15.3m (18.2%);
  • Administration expenses for the year of €17.2m net of depreciation and amortisation (€0.2m) and exceptional costs (€0.4m);
  • Net loss after tax of €3.5m pre-exceptionals;
  • Inventory of €719m inclusive of €101m investment in work-in-progress; and
  • Net cash of €131m at 31 December 

 

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