Lokum Deweloper (LKD) Q4 2024 earnings summary

Executive summary

• 2024 was marked by a challenging macroeconomic environment, high interest rates, and the end of the 'Bezpieczny Kredyt 2%' program, leading to a 77% drop in sales and a 67% decrease in delivered units year-over-year.

• Net profit fell 81.5% to PLN 31.2m, with profitability driven mainly by historical land values rather than current development activity.

• The company entered 2025 with a strong balance sheet, negative net debt, and a portfolio of nearly 650 available units.

Financial highlights

• Revenue: PLN 31.0m (+6.2% y/y); Net profit: PLN 31.2m (-81.5% y/y); Operating loss: PLN -1.7m (flat y/y).

• Gross margin: 6.4% (2023: 6.7%); Net margin: 100.6% (2023: 578.3%, due to one-off items).

• ROA: 3.6% (2023: 18.8%); ROE: 4.5% (2023: 24.1%).

• Cash and equivalents: PLN 1.0m (2023: PLN 52.5m); Total assets: PLN 862.5m (-4.1% y/y).

• Equity: PLN 690.7m (80% of assets); Net debt: PLN 110.5m (2023: PLN 127.0m).

Outlook and guidance

• The company is prepared to respond to improved credit availability and demand, with a pipeline of over 10,000 units in preparation and permits expected for 3,000+ units in 2025.

• Management expects market recovery to depend on interest rate cuts and new government support programs.