GLV Glenveagh Properties Plc

10 January 2025

Glenveagh Properties plc

Full Year Trading Statement 2024

Benefits of innovation and Partnerships deliver record year with 112% EPS growth achieved

Positioned for further growth in 2025

Glenveagh Properties plc ("Glenveagh" or the "Group") is today issuing a trading update for the year ended 31 December 2024 ahead of the publication of its full-year results on Thursday, 13 March 2025.

2024 Performance Summary

Note 1: Preliminary unaudited financials.

Note 2: As at 8 January 2025. Prior year data as at 9 January 2024.     

2024 Performance Summary

-       Revenue grew by 43% to approximately €869m (2023: €608m) with gross profit increasing by 63% to €184m (2023: €113m).

-       Gross margin of 21.2%, (2023: 18.5 %), reflects the benefits of the Group's strategic focus on innovation and efficient unit delivery in the Suburban segment and successful acceleration of the Partnerships business.

-       Partnerships recorded revenue of approximately €120m (2023: €17m) with two further transactions adding 451 units (€161m) to the Group's pipeline. Construction has now commenced on all four Partnerships sites.

-       A further forward fund transaction for 139 units (€52m) signed at the Group's Barn Oaks development following completion of 656 Urban units in 2024.

-       Planning permission has been granted for 2,487 units ensuring that all targeted output for 2025 is fully approved.

-       Net debt reduced to approximately €178m (H1 2024: €244m) reflective of strong cash generation in H2 notwithstanding significant investment in land in the fourth quarter.

-       EPS is in line with full-year guidance of approximately 17 cent.

-       €50m share buyback programme announced in September increased to a total of €65m.

Strategic Expansion of Group Landbank

The implementation of the National Planning Framework ("NPF") has led to a limited supply of zoned serviced land suitable for viable own-door housing. While the proposed increase in the national annual unit ceiling from 33,000 to 50,500 in the draft revision of the NPF is a positive development, the duration of county development plan cycles and planning timelines means that limited marginal own-door units will be delivered on newly zoned sites before 2029.  

This dynamic has necessitated proactive investment in land by the Group in sites with the capacity to deliver own-door housing today. The exit of the last remaining borrowers from NAMA, and landbank sales by non-traditional landholders, has allowed the Group to opportunistically acquire approximately 9,000 units across 14 sites principally for use in the Suburban segment. The total cost of these acquisitions is €285m^3,4 with approximately €210m³ deployed in 2024 (with the balance to be deployed in 2025⁴). These sites were purchased at an attractive cost of €31k per unit, site cost as a percentage of net development value (<10%³) with strong embedded spot margins of approximately 21%, and an attractive ROCE profile. Approximately 70% of the investment and potential units are attributable to sites in Dublin. Four sites have suitable existing planning permissions and construction has already commenced on two of these. Additionally, the Group has identified the potential for at least 2,000 Partnership units on sites adjacent to these recent site acquisitions, 275 of which have been signed to date.

The Group's controlled landbank is now approximately 20,000 units supporting the delivery of between 2,600 and 3,600 equivalent units per annum across our business segments through to 2029, without further land investment or additional Partnerships awards. Capital employed in land at year end is approximately €555 million⁵ representing a peak year-end investment level. Reductions in our landbank investment through unit delivery are expected to be complemented by site sales exceeding €100 million over two years as the Group further optimises its landbank.

Capital Allocation

The Group initiated a further €50m share buyback programme on 6 September 2024. As of 8 January 2025, approximately €33m has been completed. Given our operational and financial position and our confidence in continued cash generation and balance sheet strength of the business, the Group intends to amend the terms of the arrangement with J&E Davy so that the maximum aggregate consideration of the current programme is €65m. The Group expects to conclude the current programme on or around the date of the 2025 Annual General Meeting in May.

Reporting Segment Simplification

Due to the change in customer profile and state schemes embedded in the remaining Urban assets, the Group intends to simplify its segmental reporting under Homebuilding and Partnerships (formerly Suburban, Urban and Partnerships) in future reporting periods commencing with H1 2025 results.

CFO Transition

Conor Murtagh succeeded Michael Rice as Chief Financial Officer on 1 January 2025, as previously announced.

Outlook

With favourable market conditions, the Group is confident of continued revenue and profit growth in 2025, underpinned by a strong order book, required planning permissions in place, increased standardisation, and vertically integrated manufacturing operation.

With proven Partnerships experience, and ability to deliver at scale Glenveagh is strongly positioned to develop housing alongside the public sector. The Partnerships segment has the potential to deliver sustained growth and will account for a materially higher weighting of revenues from 2025.

The Group expects to deliver EPS of approximately 19.5 cent in 2025.

Note 3: Net of stamp duty and fees.

Note 4: Includes sites conditionally acquired and deferred payments on completed sites.

Note 5: Excluding development rights.

CEO Stephen Garvey commented:

"Our strong 2024 performance, with a notable 77% increase in new homes delivered to customers, reflects the value of our long-term investments in supply chain integration and public-private collaborations. Proactive decision-making, efficient cost management, and our focus on larger own-door housing sites have been key drivers and will underpin our continued success. The increase in gross margin to 21.2% in 2024 from 18.5% highlights our commitment to operational efficiency, innovation and cost management. Furthermore, the Group's balance sheet strength and agile approach to capital allocation have meant we have been able to opportunistically invest in highly attractive Dublin-centric own-door sites that set the business up well for continued long-term success.

Through our carefully planned and structured Partnerships platform we have started to demonstrate how the public-private model can maximise collective experience and resources to deliver the homes the country needs at scale, while providing value for taxpayers. We remain excited about the growth potential for our Partnerships business.

More broadly, there remains a serious challenge to housing delivery without substantial additional capital (public and private), adequate zoned land, public sector resources and critical infrastructure to support new homes. The evidence from 2024 indicates that delivering the targeted 300,000 homes by 2030 requires a renewed impetus at all levels of the public and private sectors, and we look forward to continuing our collaboration to achieve this critical goal."

Divisional Commentary

Suburban

The Suburban segment generated revenue of approximately €631m (2023: €470m), primarily from 1,650-unit sales (2023: 1,328) with an Average Selling Price (ASP) of approximately €365k (2023: €336k). The increase in ASP was driven largely by site and product mix, and is expected to normalise in 2025. Unit deliveries reflect the timing of land acquisitions and the balancing of output into 2025 as the business prioritised efficient unit delivery on sites of scale.

Suburban margin was approximately 22.2% in 2024, up from 20.2% in 2023, reflecting the benefits of the Group's strategic focus on innovation and efficient unit delivery, augmented by land sales (+40 bps).

The Group finished the year with 703 Suburban units contracted or reserved (2023: 680).  This strong orderbook, combined with existing units close to completion will facilitate a robust first half of 2025. Suburban unit deliveries in 2025 are expected to exceed 1,500 with recent land acquisitions primarily contributing units from 2026. Although unit deliveries are expected to be second half weighted, as is typical, existing units close to completion will mean that the split of deliveries between the first and second half is expected to be more balanced than was the case in 2024.

Urban

Urban revenue was approximately €118m (2023: €120m) and Urban gross margin was approximately 20.1% (2023: 12.8%). 2024 project completions included Cluain Mhuire, Citywest and Castleknock with 649 units completed in the period.

Additional forward fund transaction for 139 units (€52m) announced at the Group's Barn Oaks site with an Approved Housing Body.

Following the request to join the Land Development Agency framework panel to accelerate the delivery of mixed tenure homes, a partnership with the agency to commence the activation of our Urban portfolio in Cork Docklands, via a forward fund transaction, remains subject to final legal and commercial agreement.

Partnerships

Partnerships revenue was approximately €120m in 2024 (2023: €17m) with Gross Margin of approximately 16.7% (2023: 12.9%). Construction progressed strongly at the Group's first two Partnership sites.

Development started at a third site adjacent to Ballymastone, and a fourth agreement was secured adding approximately 451 equivalent units (€161m) to the Group's pipeline.

ENDS

For further information please contact:

Notes to Editors

About Glenveagh Properties plc

Glenveagh Properties plc, listed on Euronext Dublin and the London Stock Exchange, is a leading Irish homebuilder.

Supported by innovation and supply chain integration, Glenveagh is committed to opening access to sustainable high-quality homes to as many people as possible in flourishing communities across Ireland. We are focused on three core markets - suburban housing, urban apartments and partnerships with local authorities and state agencies.

www.glenveagh.ie

 Forward-looking statements

This announcement does not constitute or form any part of an invitation to underwrite, subscribe for or otherwise acquire or dispose of any shares of Glenveagh Properties plc (the "Company" or "Glenveagh").

This announcement contains statements that are, or may be deemed to be, forward-looking statements. Forward-looking statements include, but are not limited to, information concerning the Company's possible or assumed future results of operations, plans and expectations regarding demand outlook, business strategies, financing plans, competitive position, potential growth opportunities, potential operating performance improvements, expectations regarding inflation, macroeconomic uncertainty, geopolitical tensions, weather patterns, the effects of competition and the effects of future legislation or regulations. Forward-looking statements include all statements that are not historical facts and can be identified by the use of forward-looking terminology such as "may", "will", "should", "expect", "anticipate", "project", "estimate", "intend", "continue", "target", "ensure", "arrive", "achieve", "develop" or "believe" (or the negatives thereof) or other variations thereon or comparable terminology. Forward-looking statements are prospective in nature and are based on current expectations of the Company about future events, and involve risks and uncertainties because they relate to events and depend on circumstances that will occur in the future. Although the Company believes that current expectations and assumptions with respect to these forward-looking statements are reasonable, it can give no assurance that these expectations will prove to be correct. Due to various risks and uncertainties, actual events or results or actual performance of the Company may differ materially from those reflected or contemplated in such forward-looking statements. You are cautioned not to place undue reliance on any forward-looking statements.

These forward-looking statements are made as of the date of this document. The Company expressly disclaims any obligation to update these forward-looking statements other than as required by law.

The forward-looking statements in this announcement do not constitute reports or statements published in compliance with any of Regulations 6 to 8 of the Transparency (Directive 2004/109/EC) Regulations 2007 (as amended).