Metrovacesa’s revenues up 32% and net profit of 12 million euros in the first half of the year

• The developer posts revenues of ¤246.6 million and records an increase in EBITDA of 183% year-on-year to ¤23.2 million.
• Delivers 952 homes in the first half of the year, 48% more than the previous year, achieving excellent visibility to achieve its annual target of between 1,600 and 2,000 homes: 93% are already sold and nearly 100% of the construction work is complete
• Cash generation amounted to 76.3 million euros in the first six months of the year, in line with the target of more than 150 million euros for the full year, which will reinforce its attractive shareholder remuneration profile.

Madrid, 29 July 2022. Metrovacesa, Spain’s leading real estate developer with more than 100 years of history, has ended the first half of 2022 with financial and operating figures that confirm the growth shown in previous quarters, consolidate the fulfilment of its annual objectives for the current financial year and reflect the soundness of its business model in the current context.

In the first half of the year, the developer recorded revenues of 246.6 million euros, an increase of 32% compared to the same period last year. This figure is due to the deliveries made during the first six months of 2022, totalling 952 homes. The company increased its EBITDA by 183.4% to €23.2 million, compared to the €8.2 million recorded in the first half of 2021. As for the net profit obtained, this amounted to €12 million, which translates into a significant increase compared to the same period of 2021, where a loss of €2.2 million was recorded. Considering the recurring profit before tax (excluding the contribution from land sales and the impact of valuation changes) the increase is 517%.

Operating activity continues to progress in line with the company’s commitments for the full year 2022, in which it plans to deliver between 1,600 and 2,000 units, 93% of which are already pre-sold and close to 100% of the construction work completed. With 952 homes delivered in the first half of the year, 60% of the minimum target for the year as a whole has been met, an increase of 48% compared to the same period last year.

Pre-sales of homes during the first half of the year amounted to 980 units, with an average price of €311,000 (8% higher than the average price for the first half of 2021). In addition, in the last twelve months, the company has recorded pre-sales of 2,117 homes, which supports future delivery targets beyond the current financial year.
Despite a volatile context in recent months, for Metrovacesa the outlook for new housing remains favourable, due to demographic factors, buyers’ preference for new homes and the limited supply under construction. Similarly, the developer has not changed its expectations for gross margins or the number of new developments to be launched in the coming months. In this regard, Metrovacesa has 5,883 homes currently being marketed, of which 1,390 units correspond to new launches in the first half of 2022, totalling 114 active projects, 52% of which are already pre-sold.

The developer has a total of 3,360 homes currently under construction, and has completed work on 759 units during the first six months of the year. It also has more than 1,100 homes with building permits, which will be ready to start construction in the near future. In addition, the first building permits have recently been obtained for the first developments in the Palmas Altas / Isla Natura area in the city of Seville, the largest development in the company’s portfolio at this time.

Jorge Pérez de Leza, CEO of the company, emphasised that “the figures for the first half of the year consolidate the growth shown in previous quarters and allow us to be confident that we will meet our targets and continue to improve our cash flow generation profile. Despite a changing economic context in recent months, Metrovacesa has been able to adapt to the environment with great flexibility, demonstrating the strength of its strategy and business model”.

Consolidating its robust financial position

The developer’s continued operational momentum in the first half of the year has enabled it to reinforce its unique cash generation profile. As at 30 June 2022, the developer generated EUR 76.3 million in gross operating cash, up 35% year-on-year. In this regard, Metrovacesa’s investor appeal is noteworthy, as last May it paid out a dividend of 90.9 million euros, making the company one of the most attractive stocks on the Spanish stock market in terms of shareholder remuneration.
With regard to the developer’s debt levels, at 30 June 2022, its net debt stood at 169.3 million euros. On the other hand, the company’s leverage ratio closed the half-year at 6.6% (vs. 6.2% at the end of 2021), remaining the lowest among listed developers in Spain.

Significant progress in its tertiary projects and land management strategy

In recent months, the developer has significantly boosted its activity in the tertiary business. A few days ago, it formalised an agreement with Vita Group for the joint development of a Vita Student residence in Madrid with 588 studios, which is the first building of the Oria Innovation Campus project, next to the former Clesa factory in Madrid. The construction works will start in 2023 and will be completed in 2025, when Vita Group will acquire full ownership of the building.

In addition, together with Tishman Speyer, Metrovacesa announced this week an agreement with a major multinational company for the lease of 5,200 m2 in the new office project Puerto Somport 21-23, in Las Tablas (Madrid), where this firm will relocate its new corporate headquarters in Spain.

Both agreements demonstrate Metrovacesa’s capacity to develop differential projects with high added value that arouse the interest of large international firms.

In this period, the company has closed land sale agreements worth 24.5 million euros, including the signing of private contracts, which will be included in the income statement in future quarters. The majority of the land in question is for residential use and is considered non-strategic, located in different locations (Alicante, Barcelona, Cadiz and Cordoba).