Kaufman & Broad: Results for the First Nine Months of 2013 UNAUDITED AND NOT APPROVED BY THE BOARD OF DIRECTORS Business Wire PARIS -- September 30, 2013 Regulatory News: *Business stable over the first nine months *Total revenues: €679.3 million *Housing orders in volume: 3,943 units *Mixed economic performance *Gross margin rate: 19.2% *Attributable net income: €23.8 million (-14.6%); Q3: €6.5 million (-24.4%) *Net financial debt: €43.1 million (-47.0% vs Nov. 2012) *Numerous developments underway *Housing property portfolio: 3 years of business (around 16,000 lots) *Creation of the position of Director of the Managed accommodations business *Opening of new location in Lille *Continued development of Commercial property projects *Outlook for 2013: stable revenues and gross margin slightly lower compared to 2012. Kaufman & Broad S.A. (Paris:KOF) announces its results for the first nine months of fiscal year 2013 (December 1, 2012 to August 31, 2013). Key consolidated data (€ million) 9 months 9 months Change Q3 Q3 Change 2013 2012 2013 2012 Revenues 679.3 675.7 +0.5% 232.8 219.7 +6.0% (excluding VAT) Gross margin 130.3 130.5 -0.2% 44.7 42.7 +4.6% Gross margin rate 19.2% 19.3% -0.1 pt 19.2% 19.4% -0.2 pt Current operating 45.3 48.4 -6.5% 14.9 17.2 -13.5% income Current operating 6.7% 7.2% -0.5 pt 6.4% 7.9% -1.5 pt margin Attributable net 23.8 27.8 -14.6% 6.5 8.5 -24.4% income Commenting on these results, Nordine Hachemi, Chief Executive Officer of Kaufman&BroadS.A., stated: “For the first nine months of the fiscal year, Kaufman & Broad stabilized its business activities. These results, which were achieved in a real estate market characterized by a lack of visibility, confirm the quality of the Brand’s position with regard to the core products, which are in high-quality locations and marketed at prices corresponding to the expectations of all our customers. Our development dynamic is built on this solid foundation and on our ability to continue building up our property portfolio from current levels representing three years of business. It has also led to our opening of a new location in Lille, in the heart of a huge population center. In addition, we decided to take advantage of the good outlook presented by our managed accommodations business by strengthening our teams with the arrival of a major professional in the sector. Finally, we are continuing the development of several commercial property projects, which should become a reality during the coming quarters. During all of fiscal year 2013, revenues are expected to remain at a level comparable to that of 2012, while gross margin is expected to be slightly down.” *Housing revenues: stable for the first nine months (+0.7%) Revenues for the first nine months of 2013 totaled €679.3 million (excluding VAT) compared with €675.7 million (excluding VAT) for the comparable period of 2012. During the third quarter of 2013, they increased 6.0%, from €219.7million (excluding VAT) to €232.8million (excluding VAT). Housing revenues amounted to €660.2 million (excluding VAT), up 0.7% compared with August 31, 2012, when they totaled €655.4 million (excluding VAT). Housing accounts for 97.2% of total revenues. Île-de-France accounted for 44.5% of Housing revenues. In the third quarter alone, Housing revenues increased 6.1%, to €223.6 million (excluding VAT). Apartments revenues totaled €630.9 million, down 1.4%. Revenues from Single-family homes in communities almost doubled totaling €29.3million, compared to €15.4 million at August 31, 2012. Commercial property revenues totaled €13.5 million. Finally, the balance of €5.6 million is accounted for primarily by Showroom revenues. During the first nine months of 2013, 3,902 housing units (EHU) were delivered, versus 3,597 housing units (EHU) during the same period of 2012. *Slight drop in housing orders For the first nine months of 2013, housing orders in volume totaled 3,943 versus 4,027 at August 31, 2012, a decline of 2.1%. In value, there was a decline of 4.4%, to€744.2 million (including VAT). Orders in Île-de-France accounted for 46.7% in volume and 49.5% in value of all housing orders, compared to 45.8% and 47.5% for the first nine months of 2012. In the third quarter, 1,348 housing units were ordered, for a total of €262.4 million (including VAT) versus 1,531 housing units ordered for €283.7 million (including VAT) over the same period of 2012, with social housing blocks having significantly declined in the third quarter of 2013. Over one year, the share of block orders fell from 33% to 24% whereas orders made by investors rose from 31% to 38%. The share of orders under the Scellier and Duflot incentives remained at 22%. The average monthly take-up rate of new programs launched during the third quarter of 2013 was 39.8%. Commercial offer totaled 3,379 housing units versus 3,782 housing units at August 31, 2012. Office orders in value accounted for €11.5 million (including VAT) over nine months. *Gross margin rate: stable at 19.2% For the first nine months of the year, the gross margin totaled €130.3 million, compared to €130.5 million at August 31, 2012. The gross margin rate remained stable at 19.2%. For the third quarter, the gross margin increased 4.6% compared with the same period in 2012 and the margin rate was 19.2%, versus 19.4% in the third quarter of 2012. Current operating profit amounted to €45.3 million over nine months and accounted for 6.7% of revenues, compared to 7.2% for the same period in 2012. In the third quarter alone, current operating profit was 6.4%, compared to 7.9% in the third quarter of 2012. The cost of net financial debt totaled €0.8 million, versus €2.8million for the first nine months of 2012. This marked improvement may be explained for the most part by the reduction in average net financial debt. Attributable net income totaled €23.8 million for the first nine months of 2013, down 14.6% compared to the same period in 2012. It was down 24.4% in the third quarter of 2013 alone and totaled €6.5 million. *Continued deleveraging and working capital requirement reduction Net financial debt was reduced by €38.2 million compared to November 30, 2012 and totaled €43.1 million at August 31, 2013. Working capital requirement totaled €141.7 million at August 31, 2013. It accounted for 13.7% of revenues based on a twelve-month rolling period, versus 14.0% at November 30, 2012. At August 31, 2013, cash and cash equivalents (available cash and investment securities) totaled €194.6 million, an increase of €40.8million from November 30,2012. Kaufman & Broad’s financial capacity at the end of August 2013 totaled €247.3 million. *Numerous developments underway In Housing, backlog totaled €1,067.6 million (excluding VAT), compared to €1,166.7 million (excluding VAT) at August 31, 2012. It represents nearly 13 months of business. At the end of the third quarter of 2013, Kaufman & Broad had 172 housing programs on the market (169 at August 31, 2012), 46 of which were in Île-de-France and 126in the Regions. In the next quarter, 27 new programs are scheduled to launch, representing 1,882 housing units (8 new programs in Île-de-France representing 694 housing units and 18 new programs in the Regions representing 1,188 housing units). At August 31, 2013, the property portfolio totaled 16,236 housing units, for potential revenues corresponding to three years of business. Kaufman & Broad intends to continue building up its property portfolio starting from current levels, which are already high. In addition, a position of Director of Managed accommodations (student, tourist and corporate accommodations, senior residences) was created and given to Daphné Teulade, the former Director of Development and Planning at GDP Vendôme Immobilier. In this position, she will be in charge of the development and coordination of that business. Since 2000, Kaufman & Broad has completed about 20 managed accommodations (representing around 3,000 lots) and intends to accelerate its development in this area. In Commercial property, Kaufman & Broad is continuing the development of several projects representing nearly 63,000 sq.m of floor area for revenues of around €400 million on which work should begin during the coming quarters. Finally, the opening of a new location in Lille is an expression of Kaufman & Broad’s desire to have a presence at the heart of a huge population center in order to develop the entire range of products offered by the Group. *Next regular publication: 2013 annual results, second half of January, 2014. Glossary Orders: measured in volume (Units) and in value, orders reflect the group’s commercial activity. Orders are recognized in revenue based on the time necessary for the “conversion” of an order into a signed and notarized deed, which is the point at which income is generated. In addition, for apartment programs that include mixed-use buildings (apartments, business premises, retail space, offices), all floor space is converted into housing equivalents. Units: are used to define the number of housing units or equivalent housing units (for mixed programs) of any given program. The number of equivalent housing units is calculated as a ratio of the surface area by type (business premises, retail space, offices) to the average area of the housing units previously obtained. EHU: EHUs (Equivalent Housing Units delivered) directly reflect sales. The number of EHUs is a function of multiplying (i) the number of housing units of a given program for which the notarized sales deeds have been signed, by (ii) the ratio between the group’s property expenses and construction expenses incurred on the said program and the total expense budget for said program. Take-up rate: the number of orders in relation to the average commercial offer for the period. Commercial offer: the total inventory of properties available for sale as of the date in question, i.e. all unordered housing units as of this date (less the programs that have not entered the marketing phase) Gross margin: corresponds to revenues less cost of sales. Cost of sales consists of the price of land parcels, the related property costs and construction costs. Backlog: a summary at any given moment, which enables a forecast of future revenues for the coming months. Property portfolio: all real estate for which a deed or commitment to sell has been signed. For more than 40 years, Kaufman & Broad has been designing, building and selling single-family homes in communities, apartments and offices on behalf of third parties. Kaufman & Broad is a leading French property builder and developer in view of its size, earnings and power of its brand. Website : www. ketb.com This document contains forward-looking information. This information is liable to be affected by known or unknown factors that KBSA cannot easily control or forecast, which may render the results materially different from those stated, implied or projected by the company. These risks specifically include those listed under “Risk Factors” in the Registration Document filed with the AMF under number D.13-0247 on April 2, 2013. KAUFMAN & BROAD S.A. Consolidated income statement * (in € thousands) *Unaudited and not approved by the Board of Directors 9 months 2013 9 months 2012 Revenues 679,313 675,672 Cost of sales (549,054) (545,174) Gross margin 130,259 130,498 Selling expenses (21,527) (21,346) General and administrative expenses (46,836) (44,745) Technical and customer service expenses (13,356) (11,591) Other income and expenses (3,250) (4,379) Current operating income 45,290 48,437 Other non-recurring income and expenses (7) (17) Operating income 45,282 48,420 Cost of net financial debt (780) (2,779) Other income and expenses - 850 Income tax (expenses)/income (13,093) (12,112) Share of income (loss) of equity affiliates 353 196 and joint ventures Income (loss) attributable to shareholders 31,762 34,575 Minority interest 7,976 6,731 Attributable net income 23,786 27,844 Earnings per share (€) ^(*) 1.10 1.29 ^(*) Based on the number of shares comprising Kaufman & Broad SA share capital (21,584,658 shares) Kaufman & Broad S.A. Consolidated balance sheet * (in € thousands) *Unaudited and not approved by the Board of Directors ASSETS Aug. 31, 2013 Nov. 30, 2012 Goodwill 68,511 68,511 Intangible assets 84,290 84,897 Property, plant and equipment 5,788 5,604 Equity affiliates and joint ventures 7,287 4,373 Other non-current financial assets 951 1,262 Non-current assets 166,827 164,647 Inventory 285,415 284,469 Accounts receivable 237,325 268,189 Other receivables 135,132 180,141 Cash and cash equivalents 194,607 153,763 Prepaid expenses 1,252 1,008 Current assets 853,731 887,570 TOTAL ASSETS 1,020,558 1,052,217 EQUITY AND LIABILITIES Aug. 31, 2013 Nov. 30, 2012 Authorized capital 5,612 5,612 Additional paid-in capital 133,102 135,910 Interim dividends - (48,455) Attributable net income 23,786 47,624 Attributable shareholders’ equity 162,500 140,691 Minority interest 8,761 8,420 Shareholders’ equity 171,261 149,111 Non-current provisions 25,352 24,510 Borrowings and other non-current financial liabilities 236,449 234,535 (> 1 year) Deferred tax liabilities 68,733 55,586 Non-current liabilities 330,534 314,631 Current provisions 146 1,000 Other current financial liabilities (< 1 year) 1,212 458 Accounts payable 458,721 473,624 Other payables 57,190 111,776 Deferred income 1,495 1,616 Current liabilities 518,763 588,474 TOTAL EQUITY AND LIABILITIES 1,020,558 1,052,217 Kaufman & Broad S.A. Additional Information (cumulative at August 31) Single-family homes in communities 9 months 2013 9 months 2012 9 months 2011 Net orders (in units) 279 188 65 Net orders (in € thousands, 78,082 39,573 22,903 including VAT) Backlog (in € thousands, 90,796 47,427 36,300 excluding VAT) Backlog (in months of 28.8 21.6 5.7 business)* Deliveries (in EHUs) 140 60 192 Apartments 9 months 2013 9 months 2012 9 months 2011 Net orders (in units) 3,664 3,839 4,795 Net orders (in € thousands, 666,133 738,757 986,523 including VAT) Backlog (in € thousands, 976,790 1,119,302 1,163,126 excluding VAT) Backlog (in months of 12.1 14.0 15.4 business)* Deliveries (in EHUs) 3,762 3,537 3,650 Commercial property 9 months 2013 9 months 2012 9 months 2011 Net orders (in sq.m) 3,953 5,334 11,489 Net orders (in € thousands, 11,482 13,823 41,660 including VAT) Backlog (in € thousands, 26,913 37,419 19,588 excluding VAT) * calculated in relation to twelve-month rolling revenues KAUFMAN & BROAD S.A. Additional Information (Quarterly) Single-family homes in communities Q3 2013 Q3 2012 Q3 2011 Net orders (in units) 146 91 53 Net orders (in € thousands, including 42,113 16,549 17,288 VAT) Deliveries (in EHUs) 65 24 49 Apartments Q3 2013 Q3 2012 Q3 2011 Net orders (in units) 1,202 1,440 1,513 Net orders (in € thousands, including VAT) 220,301 267,173 306,213 Deliveries (in EHUs) 1,293 1,146 1,225 Commercial property Q3 2013 Q3 2012 Q3 2011 Net orders (in sq.m) 315 - - Net orders (in € thousands, including VAT) 502 - - Contact: Chief Financial Officer Bruno Coche +33 (1) 41 43 44 73 Infosfirstname.lastname@example.org or Press Relations Delphine Peyrat - Wise Conseil +33 (6) 38 81 40 00 email@example.com
Kaufman & Broad: Results for the First Nine Months of 2013
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