METROVACESA: 9M’20 RESULTS (ANÁLISIS BANCO SABADELL)
3Q'20 vs. 3Q'19 ResultsSales: € 12.4 M (-50.8% vs. -25.3% BS(e));
EBITDA: € -3.6 M (vs. €-5.0 M BS(e))
Net Profit: € -6.4 M (€ -6.0 M in 9M'19 vs. € -8.76 M BS(e));
9M'20 vs. 9M'19 Results
Sales: € 108.7 M (-0.3% vs. +5.6% BS(e));
EBITDA: € -11.6 M (vs. €-12.9 M BS(e));
Net Profit: € -82.3 M (€ 0.1 M in 9M'19 vs. € -84.66 M BS(e));
The results are solid on the presales level, which in 3Q’20 on a standalone basis reached 505 units (290 units BS(e)), of which 203 stem from a BtR agreement. On the negative side, deliveries over the period are below forecasts: 63 units vs. 78 BS(e)), and once again this year the figure will depend on Q4 performance in order to carry out most of the forecast deliveries (361 units must be delivered in Q4 to reach the midpoint of the range the company has set as a target in 2020). No land was sold in 3Q’20 on a standalone basis.
EBITDA is negative, as the low level of deliveries was unable to offset overhead costs.
At the end of the period the company had 7,429 active units and 3,639 under construction, of which 2,637 units are already presold (equivalent to € 747 M). As for the short-term delivery prospects, 788 units are currently built, of which 555 are already presold. The delivery of these units is being carried out as the LFO is obtained.
The company has also announced its intention to pay out a dividend of at least € 0.26/sh. starting in the 1H’21 (4.3% yield vs. € 0.10/sh. BS(e)). The stock has slid by -44% thus far this year and is trading at a -70% discount to the assets’ appraisal value, which we believe is excessive. According to MVC, the current share price means valuing the portfolio at € 160/m2, levels in line with the price of non-urban land. BUY. Target Price: € 9.20/sh (upside 87.76%)
Metrovacesa SA, formerly Metrovacesa Suelo y Promocion SA, is a Spain-based real estate developer. The Company specializes in construction and sale of sustainable housing, both single-family and multi-family residential properties. Its activities also include promotion, urbanization and parceling of real estate in general, as well as real estate management for own benefit or on behalf of third parties. Its asset portfolio includes more than 6 million square meters of building land across Spain, as well as already developed properties in cities, such as Malaga, Almeria, Cordoba, Barcelona and Madrid, among others.
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