Neinor Homes (HOME) H1 2024 earnings summary

Executive summary

• Strong Spanish macroeconomic and residential fundamentals, with robust demand, population growth, and limited supply underpinning performance.

• Strategic plan execution ahead of expectations, shifting from value/dividend to equity-efficient growth, with double-digit earnings growth targeted and €500mn AUMs reached.

• High visibility on results and dividend distributions, targeting €325mn over 20 months, representing a 31% accumulated yield.

• JV business exceeded targets, including a €200mn senior living agreement with Octopus Real Estate and expansion into a €45bn market.

• Significant shareholder remuneration through capital reductions and dividends, with over €114mn planned for 2024.

Financial highlights

• 1H 2024 revenues reached €182mn, EBITDA €22–27mn, and adjusted net income €12mn, with gross margin at 27.9–29.7%.

• Net income grew 97% year-over-year in H1 2024.

• Cash position at €224mn, with conservative loan-to-value of 13.8–14.3%.

• 582–882 units delivered (notarized) in H1, with 836–1,173 units pre-sold and orderbook at €601mn.

• Total assets at €1,650.8mn, equity of €948mn, and financial debt of €426.2mn.

Outlook and guidance

• Dividend guidance: €200mn for 2024, €125mn for 2025, and €70–75mn for 2026, with accelerated payments where possible.

• Guidance uplift towards €80mn net income in the medium term, with focus on equity-efficient growth and double-digit earnings.

• On track to deliver c.2,000 units and €65mn net income for FY24, with majority of deliveries in H2.

• Pre-sales coverage: over 80% for 2024, ~40% for 2025, and 15% for 2026, with targets to increase coverage by year-end.

• Focus on deploying JV capital, maintaining flexibility between direct and co-investment land acquisitions.