METROVACESA: FY2019 RESULTS (ANÃLISIS BANCO SABADELL)
4Q'19 vs. 4Q'18 ResultsSales: € 61.0 M;
EBITDA: € -16.6 M;
Net Profit: € -4.6 M.
FY2019 vs. FY2018 Results
Sales: € 170.0 M (vs. € 220 M BS(e));
EBITDA: € -9.9 M (vs. €-4 M BS(e));
Net Profit: € -4.5 M (vs. €-9 M BS(e));
The company released poor FY2019 results, with only 289 housing units delivered (vs. the company’s forecast of 600 units as of 9M’19 and vs. 500 BS(e)). The company blames this result on the new mortgage regulations and the delay in receiving LPOs (licence of first occupation), claiming that it if the housing units that have already built and those that are being delivered at the beginning of 2020 were taken into account, the number of housing units delivered would be 509.
Of the € 170 M of revenues registered, € 107 M come from land sales, which were made with a +2% premium on GAV. Tertiary land represents 82% of land sales.
Presales totalled 2,131 units as of YE’19, and thus in 2019 the company sold 1,511 units (407 in the 4Q on a standalone basis), which is not a bad figure.
The NAV per share remains stable at € 17.06/sh., and thus it is trading at a -48% discount to that reference.
The company also suggests that it could pay more than € 70 M in dividends (to be decided next month), which would mean a yield above 5%. Furthermore, there is a share buyback plan for another € 50 M (3.6% of market cap, already in place since the beginning of the year, and with € 2.6 M repurchased to date, meaning almost the entire plan is yet to be carried out).
The results are disappointing, although not catastrophic, bearing in mind that many deliveries would already have been made in late February. But again, the share price is already factoring in an adverse enough scenario (trading at a -48% discount to NAV), and the share buyback plan plus the dividend should underpin the stock at the current level. BUY. T.P. Under Revision.
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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