Company presentation. Baard Schumann, CEO & Sverre Molvik, CFO 13 January 2016

Transcription

1 Company presentation Baard Schumann, CEO & Sverre Molvik, CFO 13 January 2016

2 Norway s leading homebuilder Land bank for homes Focus on fast growing urban regions Trondheim 501 units Annual sales app units Tripled annual turnover from to NOK 3 billion Profit margin increased over the same period from 6 to 13% Dividend up to 50% of net profits Bergen 156 units Stavanger units Greater-Oslo units Stockholm 103 units Other 155 units Note: The numbers represent the size of the land portfolio as at 30. September All numbers are adjusted for Selvaag Bolig s share in joint ventures. 1) Greater Oslo area: Oslo, Akershus, Buskerud, Vestfold and Østfold, 2) 155 units at Tromsø (Troms county), 3) The residential property development portfolio 2 consists of land plots that are to be paid for when planning permission is received. These have a development potential of ~4 950 residential units, whereof the company has purchasing obligations for ~4 300 and purchasing options for ~650 units

3 Value creation in Selvaag Bolig 6 36 MONTHS 6 12 MONTHS MONTHS 3 9 MONTHS Residential development Acquire and refine land for development Project design Marketing and sale Construction Value creation Zoning Sales start Construction start Deliveries Project optimization Buy (i) options on unzoned land, or (ii) ready to build land Lever acquired land to improve ROE Plan and prepare for construction Target 60% pre-sale before start-up (irrevocable purchase contracts) Prices on remaining 40% increased gradually during sell out phase Fixed price contracts with reputable and solid counterpart Construction costs financed with construction loans Target 100% sale at delivery 3

4 Selvaag Bolig value proposition Selvaag Bolig ASA is a Norwegian residential property developer with no in-house construction arm, which controls the entire value chain from the acquisition of land to the sale of homes. Low risk business model 60 per cent presale before construction starts Only present in fast growing urban regions with high demand and large market depth Very competitive prices ensure a broad customer base No in-house construction arm All construction activity put out to competitive tender Lower building costs Fixed construction price Reduced risk Smaller exposure to market fluctuations Defined housing concepts Aimed at broad consumer categories Profit maximisation in all projects Large projects with more than 150 apartments Large land bank Several thousand homes under development in Norway s four fastest growing urban regions 4

5 Norwegian housing market Good demand for new homes and persistent population growth in urban areas Low risk for housebuilders Advance sales: banks require that 50-70% of homes are sold before construction starts Binding offers: offer to purchase is a binding sales contract, and requires a 10% minimum cash deposit High level of home ownership 85% (one of the world s highest) Economic benefits for home owners 25% of mortgage loan interest payments are tax-deductible Transfer stamp duty for new houses is lower than for second hand homes Strong population growth Norway s urban areas are among the fastest growing in Europe. Good demand for new homes Source: Source Selvaag Bolig and Eurostat 5

6 Three well defined and robust concepts Small and affordable apartments In and around large cities Close to public transportation Young people in the start-up phase Apartments/small houses situated in high density areas Established housing solutions, solid quality and well planned living environment Single people/couples in all ages, with/without children Apartments with attractive, central location in large cities High quality standard coupled with a service concept Affluent customers who value comfort and convenience 6

7 Finance and risk 7

8 Value creation and project cash flow 6 36 MONTHS 6 12 MONTHS MONTHS 3 9 MONTHS Residential development Acquire and refine land for development Project design Marketing and sale Construction Value creation Zoning Sales start Construction start Deliveries Cash flow example E.g., total land cost: MNOK 100 (50% equity + 50% loans) E.g., total revenues: MNOK 550 App. 1% of total cost Development cost: MNOK 5 50% of land loan converted to construction loan Total equity: MNOK 55 NGAAP: Profit in P&L through percentage of completion method commences No more equity required Profit: MNOK 77 (14% of project turnover) IFRS: Average profit at delivery: 14% of project turnover NGAAP: Average accumulated profit: 14% of project turnover 8

9 Low-risk business model Risk profile at start of a MNOK 550 project De-risking in key stages of projects 60% = MNOK 330 Minimum presale 76% = MNOK 418 Remaining project cost 14% = MNOK 77 Project margin Equity investment Sales price Selvaag s equity investment in a project and project margin bring the remaining project cost down to 74%-78% With minimum 60% pre-sale there is limited remaining project risk. For the the remaining 40% a price reduction of 35% would recover equity 78% of units in production are sold at end Q % = MNOK % = MNOK Land purchase conditional on zoning approval 2 Land purchase price based on market value at time of zoning approval 3 Minimum sales rate of 60% before construction 4 Fixed price construction contract Purchase and payment of land takes place after zoning plan approval. If this is not obtained, the purchase is cancelled SBO is in charge of the zoning process Purchase price is decided by a land appraisal made by three external consultants at the time of zoning approval The median valuation is used as purchase price Pre-sales of minimum 60% secures the majority of revenue before construction 10% of purchase price paid by the buyer at point of sale, and proof of financing for the remaining amount is required Construction contracts with solid counterparties are made with fixed price Project costs are secured before construction starts 9

10 FINANCIAL UPDATE Income statement highlights Q (IFRS) Delivery of 202 units (279) Revenues and EBITDA margin (IFRS) Revenues NOK 778m (765) NOKm Sale of units NOK 763m (752) Other revenues NOK 16m, mainly lease income Project costs NOK 624m (628) Of which NOK 23m are interests Other costs NOK 59m (47) Salaries, sales and marketing key components EBITDA adjusted 134m (125) 12% 16% 13% 15% 14% Adjusted for financial expenses included in project costs EBITDA NOK 111m (95) EPS in the quarter NOK 0.76, YTD NOK 2.28 Q Q Q Q Q Operating revenues EBITDA margin 10

11 OPERATIONAL UPDATE High number of units for delivery Development units under construction Expected completions per quarter Units NOK million No of units (net figures) Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q Q Q Q Q Number of units under construction Sales value (NOK million) Q3 2015: 78% sold, 57% of construction volume in Greater Oslo YE 2016: ~80% of construction volume in Greater Oslo 95% of 2015 completions sold by Q % of 2016 completions sold by Q Note: Projects are included when construction start is decided. All numbers are adjusted for Selvaag Bolig s ownership share in joint ventures. 11

12 FINANCIAL UPDATE Income statement highlights Q (NGAAP) Revenues and EBITDA margin (NGAAP)* 12 months rolling revenues (NGAAP)* NOKm NOKm % 15% 17% 15% 15% Q Q Q Q Q Q Q Q Q Q Operating revenues EBITDA margin * Construction costs are exclusive of financial expenses in the segment reporting (NGAAP) 12

13 FINANCIAL UPDATE Sound debt structure Interest bearing debt as at 30 September Loan facility NOK 500 million senior unsecured bond loan maturing in 2018 Drawn per 30 Sep (NOKm) Interest rate margin % 1,326 NOK million 2 3 NOK 150 million revolving credit facility from DNB maturing in 2015 NOK 150 million working capital facility from DNB maturing in % % Land loan facilities from a range of Nordic credit institutions % % 5 Construction loan facilities from a range of Nordic credit institutions % % Top-up loan Land Loan Construction loan Total net interesting bearing debt NOK million Note: Top-up loan of NOK 500m in the table differs form the summed up top up loan in the pie chart (NOK 493m). The difference is due to NOK -7m in amortized cost which is not actual debt. 13

14 Portfolio 14

15 Land bank for homes Trondheim 461 units Bergen 217 units Stavanger units Greater-Oslo units Stockholm 103 units Other 80 units 15

16 OPERATIONAL UPDATE Q High number of units for delivery Development units under construction Expected completions per quarter Units NOK million No of units (net figures) Q3 14 Q4 14 Q1 15 Q2 15 Q3 15 Q Q Q Q Q Number of units under construction Sales value (NOK million) Q3 2015: 78% sold, 57% construction volume Greater Oslo YE 2016: ~80% construction volume Greater Oslo 95% of 2015 completions sold by Q % of 2016 completions sold by Q Note: Projects are included when construction start is decided. All numbers are adjusted for Selvaag Bolig s ownership share in joint ventures. 16

17 ACQUISITIONS Acquisitions in Oslo-area since Q Six new projects Oslo: Valle Hovin 400 apartments Oslo: Lørenvangen apartments Oslo: Sinsenveien Oslo: Frysja 350 apartments 400 apartments 50/50 JV Bærum: Fornebu 160 apartments Oslo: Lørenveien apartments 17

18 TOMTEBANK Tomtebank overblikk: boliger Tromsø 155 boliger Strandkanten II Hordaland 156 boliger Nyhavn - (+68 Torvmyra) Rogaland boliger Sola Stavanger Sandnes Sør-Trøndelag 349 boliger Lade Allé - 83 Heimdal + opsjon (80) - 45 Krydderfabrikken Stor-Oslo boliger Oslo Sentrum Oslo Nord og Lørenskog Oslo Syd og Moss Oslo Vest, Bærum og Asker Tønsberg Drammen Stockholm 103 boliger - 40 Løvholmen - 63 Svea Fanfar Spania 100 boliger Alfaz del Sol Alle tall er Selvaag Boligs andel. Inkluderer Sinsenveien, Lørenvangen 22 og Valle Hovin

19 TOMTEBANK Stor-Oslo 1: Løren/Økern/Ensjø Bærum Kjelsås 312 boliger Kjelsåsveien boliger Løren Økern torgvei Tiedemannsbyen Sinsenveien Lørenvangen Lørenveien Valle Hovin Lørenskog boliger Skaarødegården - 66 Vestparken Skårer bolig LSV boliger Kilenkollen Avløs Ballerud Store Stabekk Store Stabekk 2 Asker 630 boliger Landås - 60 Landås kjøpt Landås opsjon Oslo Syd 428 boliger - 24 Bjørnåsen Nord - 28 Bjørnåsen Syd III - 76 Mortensrudhøyden Gjertsrud Stensrud Nesodden 46 boliger - 46 Bergerås Alle tall er Selvaag Boligs andel. Inkluderer Sinsenveien, Lørenvangen 22 og Valle Hovin

20 Løren 5 Oslo 527 units 260 units under construction 227 units completed 20 Sales start: 2010 Rest development: 40 units, (not including sold but not started units)

21 Lørenveien Oslo 412 units 0 units completed 0 units under construction 21 Sales start: H Rest development: 412 units

22 Nybyen Økern Oslo 403 units 0 units completed 217 units under construction 22 Sales start: 2014 Rest development: 186 units, (not including sold but not started units)

23 Valle Hovin Oslo 375 units Sales start phase 1 October Time from acquisition to sales start: 8 months NOK 220m acquisition in Feb. 15 Sales start Oct. 15

24 Kilenkollen Bærum - Greater Oslo 160 units 54 units under construction Sales start phase 1 October Time from acquisition to sales start: 7 months NOK 156m acquisition March 15 Sales start Oct. 15

25 Landås Asker Greater Oslo ~630 units 0 units completed 0 units under construction 25 Sales start: H Rest development: 630 units

26 Lørenskog stasjonsby Greater Oslo 1083 units 186 units completed 197 units under construction 26 Sales start: 2013 Rest development: 700 units, (not including sold but not started units)

27 Skårer bolig Lørenskog Greater Oslo ~980 units net 0 units completed 0 units under construction 27 Sales start: 2017 Rest development: 980 units net

28 Ensjø Oslo ~188 units net (JV) 0 units completed 0 units under construction 28 Sales start: H Rest development: 188 units net

29 Sinsenveien Oslo ~190 units net (50-50 JV) 0 units completed 0 units under construction 29 Sales start: H Rest development: 380 units

30 Lørenvangen 22 Oslo 180 units 0 units completed 0 units under construction 30 Sales start: H Rest development: 180 units

31 TOMTEBANK Stor-Oslo 2: boliger Drammen 300 boliger Skalstadskogen Oppegård 85 boliger - 63 Kornmoenga - 22 Ormerudveien Ski 61 boliger - 61 Ski Kaldnes Tønsberg 483 boliger Kaldnes - 49 Kaldnes Boligutvikling Moss 118 boliger Moss Alle tall er Selvaag Boligs andel.

32 Kaldnes Tønsberg Greater Oslo 709 units 226 units completed 26 units under construction 32 Sales start: 2010 Rest development: 457 units (not including sold but not started units)

33 Kjelsåsveien 161 Oslo ~312 units 0 units completed 0 units under construction 33 Sales start: 2023 Rest development: 312 units

34 Avløs Bærum Greater Oslo ~631 units 0 units completed 0 units under construction 34 Sales start: Zoning. H Rest development: 631 units

35 Ballerud Bærum Greater Oslo ~300 units 0 units completed 0 units under construction 35 Sales start: H Rest development: 300 units

36 Store Stabekk Bærum Greater Oslo ~1 000 units 0 units completed 0 units under construction 36 Sales start: Zoning Rest development: units

37 TOMTEBANK Rogaland: boliger Jaasund Sola 513 boliger Jaasund Jaasund opsjon Lervig Stavanger 515 boliger Lervig brygge Sandnes sentrum 540 boliger Indre vågen Aase Gård - Sandnes 120 units Aase gård Alle tall er Selvaag Boligs andel.

38 Lervig Stavanger 888 units 373 units completed 0 units under construction 38 Sales start: 2010 Rest development: 515 units

39 Indre vågen Sandnes centre ~540 units 0 units completed 0 units under construction 39 Estimated sales start: H Rest development: 540 units

40 Jaasund Sola 632 units 119 units completed 17 units under construction 40 Sales start: 2010 Rest 513 units (not including sold but not started units)

41 Nyhavn Bergen 144 units 144 units under construction 0 units completed 41 Sales start: 2014

42 Torvmyra Bergen 68 units 0 units under construction 0 units completed 42 Sales start: Q2-Q3 2016

43 Lade Allé Trondheim 221 units 181 units under construction 40 units completed 43 Sales start: 2014 Rest development: 0

44 Heimdal Trondheim 200 units 0 units under construction 0 units completed 44 Sales start: 2016 Rest development: 200