Yahoo Finance Nexity: 2023 full-year results
FULL-YEAR RESULTS IN LINE WITH OBJECTIVES
DELEVERAGING LEVERS INITIATED
ACCELERATING THE GROUP’S TRANSFORMATION IN 2024
Business activity – Nexity beats the market
New home reservations down 19% by volume – amid a market that shrank by 26% over one year and by 41% over two years
Continued strong growth in managed real estate, with revenue up 25%
Financial results in line with objectives:
Revenue of €4.3 billion; operating profit of €246 million
Net debt: €776 million (down €43 million vs 2022)
Solid liquidity: €882 million in cash flow and undrawn credit facility of €630 million
2023: A busy year for refocusing the Group’s roadmap
Pivoting towards urban regeneration:
First market deal with Carrefour and creation of land banking joint venture:
Expected revenue at termination: >€2 billion over 10 years
Launch of Nexity Héritage and land banking solution with Mirabaud AM
Deleveraging levers initiated:
Disposal of international activities (Poland and Portugal)
Search for strategic and financial partners in the management and distribution businesses
2024: A year of far-reaching transformation
Finalisation of the sale of Property Management for Individuals business to Bridgepoint for an enterprise value of €440 million, concerning ~3,100 employees; ongoing process to seek out strategic and financial partnerships
Accelerating the shift in the Group’s business model towards that of an urban operator:
Implementing far-reaching organisational transformation based around a regional,
multi-product offering and ramping up the Serviced Properties businessAdjusting the workforce in keeping with new market parameters and changes in scope
In view of its adaptation and transformation, the Group has decided to initiate in the coming weeks an information and consultation process with employee representative bodies before implementing a redundancy plan (PSE in French). As such, the Board proposes that the dividend in respect of financial year 2023 be suspended1
Improved profitability from 2025, and as a result, maximum net debt of €500 million at year-end 2025
Dividend policy consistent with the context and reviewed annually in light of free cash flow
Forecast for 2024:
Operating profit to remain positive while reaching a low point, taking into account gains on disposals, the costs of adjusting supply to new market conditions and costs relating to the Group’s reorganisation, paving the way for a rebound in 2025
Net financial debt considerably lower than at the end of 2023
VÉRONIQUE BÉDAGUE, CHAIRWOMAN AND CHIEF EXECUTIVE OFFICER, COMMENTED:
“At the end of a year marked by an ongoing deterioration in the real estate market, with an historic slowdown in both residential and commercial private investment, Nexity has once again demonstrated its ability to meet its financial targets thanks to its commercial agility, the strength of its long-term relationships with public investors and the exemplary commitment shown by its staff, whom I’d like to thank in particular.
The sector in which we operate is going through a crisis that is unprecedented in terms of its intensity, duration and scope, affecting both supply and demand. Nexity will adapt to this new reality more quickly in 2024, by making adjustments that will enable it to sell supply designed during the previous cycle, scaling its organisation to match new market conditions with respect to volume, and switching to an operating model focused on local areas in order to meet the demand for our services as an urban operator even more effectively.
This means that we will recognise the costs of these transformations, including the implementation of a redundancy plan, in 2024, and will continue to refocus the strategic roadmap and deleverage the business. To do so, we will minimise risk as we ramp up urban regeneration activities with operational partners, and we will- continue seeking out strategic and financial partnerships in services, particularly in the management and distribution businesses.
Having reinforced our financial structure, Nexity is in a position to convert all the growth opportunities offered by the emerging new real estate cycle, as evidenced by initial positive indicators, and to extend our leadership, as we have succeeded in doing after every previous market crisis.”
KEY FIGURES FOR 2023
Business activity – France | 2022 | 2023 | Change |
Reservations: Residential Real Estate |
|
|
|
Volume | 18,015 units | 14,602 units | -19% |
Value | €3,924m | €2,964m | -24% |
|
|
|
|
Development backlog | €6.1bn | €5.4bn | -12% |
| |||
Financial results (in €m) | 2022 | 2023 | Change |
Revenue | 4,704 | 4,273 | -9% |
Operating profit | 367 | 246 | -33% |
Operating margin (as % of revenue) | 7.8% | 5.7% | -210 bps |
Group share of net profit | 188 | 19 |
|
Net debt1 | 820 | 776 |
|
x EBITDA after lease payments2 | 1.5x | 2.5x |
|
1 Net debt before lease liabilities and following application of IFRS 5 after entering into exclusive negotiations on 21 December 2023 for the sale of the Property Management for Individuals business.
2 Leverage ratio calculated in accordance with contractual terms set out in financing agreements (IFRS reporting).
PERFORMANCE BY DIVISION
RESIDENTIAL REAL ESTATE DEVELOPMENT
Business activity
In a highly challenging market, Nexity’s business activity showed resilience: 14,602 reservations were booked, down 19% in a market that declined by 26%. The total value of these reservations was €2,964 million (down 24%). The latest FPI statement, dated 15 February, reported 94,828 reservations in the market, a record low for the past 10 years.
As expected, and in line with market data, retail sales declined sharply (down 41% compared with 2022), mainly due to lower solvency among individual clients arising from the substantial, lasting rise in interest rates and the drop in implied yields for individual investors. Sales to individual investors and homebuyers fell to an all-time low, accounting for 21% and 12% of total sales, respectively.
Bulk sales remained strong, holding steady year on year: Nexity continued to pursue its dynamic sales strategy, in place since 2022, earmarking retail sale reservations for bulk sales, through its long-term partnerships with private and public landlords.
Bulk sales accounted for 67% of total reservations at year-end 2023, up 13 percentage points from 2022, driven in particular by bulk sales of intermediate housing, which more than doubled year on year, peaking at 16%.
The difference between the change in reservations by volume and by value is mainly due to the change in the product mix.
Supply for sale at year-end 2023 was down 23% relative to year-end 2022, at 7,778 units, with take-up periods stable at around 7 months. These trends reflected the Group’s increasingly selective approach to launching programmes (the average rate of pre-selling was nearly 75%2 on programmes launched in 2023) and demonstrated its ability to adapt its supply despite a slower pace of sales. Developments under construction accounted for around 46% of the total supply for sale (vs. 60% for the market as a whole) and the stock of unsold completed units remained marginal, at around one hundred.
Financial performance
(in millions of euros) | 2022(1) | 2023 | Change |
Revenue | 3,385 | 2,942 | -13% |
Operating profit | 280 | 140 | -50% |
Margin (as % of revenue) | 8.3% | 4.8% | -350 bps |
(1) Reclassification of Villes & Projets (historically classified in the Other Activities division) in Residential Real Estate Development
Revenue declined by 13% in 2023 to €2,942 million, reflecting the slower pace of signings of notarial deeds of sale since the beginning of the year and fewer new programmes launched into the construction phase.
Operating profit was €140 million (down 50%), representing a margin of 4.8%, down 350 basis points. This change was mainly due to the decrease in revenue, the change in the customer mix with a higher proportion of bulk sales, higher construction costs affecting the budgets of certain programmes under construction, and the slowdown in business, which has affected the balance of overhead costs.
Outlook:
The backlog stands at €5.0 billion, representing two years’ revenue.
The Carrefour partnership announced in 2023, which is fully aligned with the Group’s increased emphasis on urban regeneration, reached a key milestone at the end of November with the formation of the “Villes et Commerces” land banking joint venture. As a reminder, this partnership covers the upgrade of 76 Carrefour sites across France through urban mixed-use projects, including 12,000 homes, and will generate revenue at termination of over €2 billion over the next ten years (developments will be included in the backlog with effect from H2 2024).
In early October, the French government made an initial revision to the country’s zoning map, reclassifying more than 150 municipalities as supply-constrained areas (A/Abis/B1), meaning they are now eligible for the “Pinel” scheme, intermediate rental housing (LLI) and the 2024 PTZ interest-free loan scheme, and in some cases raising rent ceilings, which in turn improves rental yields. This zoning extension will enable Nexity to recalibrate developments currently being set up in the municipalities concerned, and to sell its available supply more quickly. For reference, 81% of Nexity’s current supply for sale is located in supply-constrained areas.
COMMERCIAL REAL ESTATE DEVELOPMENT
Business activity
With the market at a cyclical low, marked by higher interest rates and changes in usage for commercial real estate (according to CBRE, investment in France was down 56% in 2023), as forecast, Nexity recorded a low volume of new orders in 2023 (€39 million).
In 2023, the Group delivered 12 developments totalling over 100,000 square metres, including the following iconic developments:
Deloitte University: 23,385-square-metre low-carbon business park standing on 14.7 hectares of land in a natural setting,
Aqueduc business park: Nearly 40,000 square metres of office space developed in Gentilly,
Facette development: 5,200 square metres of office space at the heart of the Belvédère development in Bordeaux, Nexity’s new regional head office.
These developments bring total deliveries over the past five years to nearly 700,000 square metres, including almost 200,000 square metres of logistics facilities, warehouses and business parks and over 50,000 square metres of higher education facilities, reflecting continuing diversity in the new business written by the Group.
Financial performance
(in millions of euros) | 2022 | 2023 | Change |
Revenue | 380 | 459 | +21% |
Operating profit | 45 | 41 | -9% |
Margin (as % of revenue) | 11.9% | 8.9% | -300 bps |
At year-end 2023, revenue totalled €459 million and operating profit was €41 million, driven, as in 2022, by the contribution of the green business park in La Garenne-Colombes, which is 75% completed.
Outlook
15 developments in progress at year-end 2023, totalling more than 200,000 square metres and ~€350 million, including the following:
Green business park in La Garenne-Colombes: 95,000-square-metre project scheduled for delivery in Q2 and Q4 2024, contributing €250 million to secure 2024 revenue.
Carré Invalides (Paris): Renovation of the 15,400-square-metre former headquarters of the Greater Paris regional council
Confluence business park (Lyon): Mixed development incorporating a 15,000-square-metre higher education campus.
Reiwa: New construction of Nexity’s future head office, totalling around 25,000 square metres, in Saint-Ouen (Seine-Saint-Denis).
While the market for off-plan sales remained buoyant outside the Paris region, the Group continued to capitalise on its integrated expertise and positioning to step up its role supporting institutional clients with urban regeneration projects under delegated project ownership and CPI development contracts.
The backlog stood at €349 million at year-end 2023.
Services
Services revenue was €872 million at year-end 2023, down very slightly and once again driven by Managed Real Estate (Serviced Properties):
(in millions of euros) | 2022 | 2023 | Change |
Revenue | 938 | 872 | -7% |
o/w: Property Management3 | 382 | 385 | +1% |
o/w: Serviced Properties | 217 | 270 | +25% |
o/w: Distribution | 340 | 217 | -36% |
Operating profit | 92 | 73 | -21% |
Margin (as % of revenue) | 9.8% | 8.3% | -150 bps |
Revenue from Property Management (Property Management for Individuals and Property Management for Companies) grew slightly, up 1% to €385 million, confirming the resilience of the condominium and rental management businesses, with a portfolio of nearly 825,000 units under management at year-end 2023 and significant contracts renewed or signed, an example being Nexity Property Management’s successful bid to manage over 4,000 sites on behalf of the Orange group. Meanwhile, rental intermediation-related business lines (sales and lettings) were affected in 2023 by the rise in interest rates and very tight supply in the rental market.
The Serviced Properties business (serviced residences for students, coworking spaces) posted €270 million in revenue (up 25%), driven in particular by the strong growth momentum of the portfolio of coworking businesses (16 new sites and an increase of nearly 24,000 square metres under management), as well as occupancy rates, which remained high at end-December for both coworking spaces (96%4) and student residences (97%).
Lastly, as expected, revenue from Distribution activities (down 36%) reflected the downturn in the new home market. It should however be noted that reservation volumes decreased less than did the individual investor market, and that the market share for distribution activities grew by two points (totalling 10.3%).
Operating profit for the Services business totalled €73 million at year-end 2023, down 21%, mainly due to lower profitability in the Distribution business, reflecting the downturns in the new home and brokerage markets. Excluding Distribution, profit grew by 8%.
Outlook:
After announcing at end-October that it had initiated a process to seek out strategic and financial partnerships in its management and distribution businesses, Nexity announced on 21 December that it had entered into exclusive negotiations with a view to selling 100% of its Real Estate Services to Individuals activities to Bridgepoint, a European leader in alternative asset management, based on an enterprise value of €440 million. This transaction, expected to be finalised in the first half of the year, involves the launch of a long-term5 strategic partnership aimed at amplifying existing synergies with Nexity’s businesses and securing their long-term future. The agencies will continue to assist with the pre-deliveries of our new buildings and provide condominium management services, we will offer dedicated rental management services to our individual investors, we will be the preferred developer for land banking and real estate projects (such as extensions to existing buildings through additional storeys), and we will have access to the client base to promote our range of services and solutions.
CONSOLIDATED RESULTS – OPERATIONAL REPORTING
Due to the process underway for the sale of Real Estate Services to Individuals activities, which is expected to be finalised in the first half of the year, the Group is applying IFRS 5 (on assets held for sale), which requires the assets and liabilities of these activities to be presented separately from other continuing operations in the balance sheet. The income statement has not been restated.
|
| 2022 |
| 2023 |
| Change |
Consolidated revenue |
| 4,704 |
| 4,273 |
| -9% |
Operating profit |
| 367 |
| 246 |
| -33% |
% of revenue |
| 7.8% |
| 5.7% |
|
|
Net financial income/(expense) |
| (65) |
| (108) |
| -67% |
Income tax |
| (90) |
| (51) |
| +43% |
Share of profit/(loss) from equity-accounted investments |
| (7) |
| (49) |
| x6.6 |
Net profit |
| 204 |
| 37 |
| N/A |
Non-controlling interests |
| (16) |
| (18) |
| +7% |
Net profit attributable to equity holders of the parent company |
| 188 |
| 19 |
| N/A |
REVENUE
(in millions of euros) |
| 2022(1) | 2023 |
| Change |
Development |
| 3,766 | 3,401 |
| -10% |
Residential Real Estate Development |
| 3,385 | 2,942 |
| -13% |
Commercial Real Estate Development |
| 380 | 459 |
| +21% |
Services |
| 938 | 872 |
| -7% |
Property Management |
| 382 | 385 |
| +1% |
Serviced Properties |
| 217 | 270 |
| +25% |
Distribution |
| 340 | 217 |
| -36% |
Revenue |
| 4,704 | 4,273 |
| -9% |
o/w: External growth in Residential Real Estate Development (Angelotti) |
| 45 | 147 |
| N/A |
(1) Reclassification of Villes & Projets (historically classified in the Other Activities division) in Residential Real Estate Development
Revenue in 2023 totalled €4,273 million, down 9% relative to 2022 (down 10% on a like-for-like basis6).
Revenue for the Development business was down 10%, mainly driven by the revenue generated through major projects in Commercial Real Estate (the green business park in La Garenne-Colombes and Nexity’s headquarters in Saint-Ouen). Revenue from Residential Real Estate Development was down 13%, due to the slowdown in business in a highly unfavourable environment.
Revenue from Services was down 7%, with the surge in revenue for the Serviced Properties business (up 25% compared with 2022) not enough to offset the decline in revenue from Distribution, which was affected by the downturn in the new home market.
In IFRS terms, revenue in 2023 totalled €3,964 million, down 9% relative to 2022. This figure excludes revenue from joint ventures, in accordance with IFRS 11, which requires these ventures – proportionately consolidated in the Group’s operational reporting – to be accounted for using the equity method. It should be noted that revenue generated by the development businesses from VEFA off-plan sales and CPI development contracts is recognised using the percentage-of-completion method, i.e. on the basis of notarised sales and pro-rated to reflect the progress of all inventoriable costs.
OPERATING PROFIT
|
| 2022(1) | 2023 |
|
| ||
(in millions of euros) |
| Current operating | Margin | Current operating | Margin |
|
|
Development |
| 326 | 8.6% | 181 | 5.3% |
|
|
Residential Real Estate Development |
| 280 | 8.3% | 140 | 4.8% |
|
|
Commercial Real Estate Development |
| 45 | 11.9% | 41 | 8.9% |
|
|
Services |
| 92 | 9.8% | 73 | 8.3% |
|
|
Other Activities |
| (51) | N/A | (48) | N/A |
|
|
Operating profit |
| 367 | 7.8% | 246 | 5.7% |
|
|
(1) Reclassification of Villes & Projets (historically classified in the Other Activities division) in Residential Real Estate Development
Operating profit was €246 million, in line with guidance.
OTHER INCOME STATEMENT ITEMS
The net financial expense totalled €108 million. In particular, it comprised an increase of nearly €25 million in financing costs due to the rise in interest rates (with 51% of total debt made up of floating-rate debt at year-end 2023) and an €8 million increase in finance costs on lease liabilities driven by growth in the portfolio of managed real estate.
The tax expense (including the CVAE7) amounted to €51 million. The current effective tax rate (excluding the CVAE) was 35% (28% at year-end 2022). This rate, which was 9 points higher than our normative rate, mainly resulted from international losses that were not recoverable against French taxes, as well as the tax on the long-term disposal gain following the transfer of Studéa shares from Property Management for Individuals to Nexity SA.
The decrease in “Share of profit/(loss) from equity-accounted investments” primarily arose from the 18% stake in Ægide Domitys.
The Group share of net profit came to €19 million at 31 December 2023.
FINANCIAL STRUCTURE
DEBT AND LIQUIDITY |
The Group’s net debt before lease liabilities amounted to €776 million at year-end 2023, down €43 million compared to 2022, in line with its debt management policy announced at the beginning of the year.
This decrease notably reflects the following:
Strict management of working capital in an adverse environment due to a more selective approach before projects are launched and the simultaneous start of construction work and signing of deeds when new land is purchased
Discontinuation of business outside France and disposal of activities in Poland and Portugal finalised in Q3, with a €100 million impact on net debt
Debt at 31 December 2023 takes into account the impact of IFRS 5 application on Property Management for Individuals and thus includes a corresponding €67 million adjustment.
The Group was in compliance with all its financial ratios as at end-December 2023. The leverage ratio8, calculated in accordance with contractual terms set out in financing agreements, stood at 2.5x, below the limit set out in the financial covenant (3.5x).
(in millions of euros) |
| 31 Dec. 2022 | 31 Dec. 2023 | Change |
Bond issues and other |
| 976 | 821 | (155) |
Bank borrowings and commercial paper |
| 874 | 837 | (37) |
Net cash and cash equivalents |
| (1,030) | (882) | +149 |
Net financial debt before lease liabilities |
| 820 | 776 | -43 |
Overall, nearly 50% of the Group’s gross debt is fixed-rate debt, limiting its exposure to rising interest rates. The Group has also put in place interest rate hedges, bringing the proportion of its gross debt that is either well hedged or at fixed rates to over 60%.
At 31 December 2023, the average maturity of the Group’s debt remained above two years (2 years and 4 months), with an average cost of borrowing of 3.8%.
The Group’s liquidity is solid, with total cash and cash equivalents of €882 million, and €630 million in confirmed undrawn credit lines.
As a reminder, in February 2023, the Group renewed its corporate credit line for a period of 5 years with an expanded pool of banks and for an increased amount (€800 million versus €500 million).
WORKING CAPITAL REQUIREMENT
(in millions of euros) |
| 31 Dec. 2022 | 31 Dec. 2023 |
| Change |
Development |
| 1,322 | 1,316 |
| (6) |
Residential Real Estate Development |
| 1,199 | 1,240 |
| +41 |
Commercial Real Estate Development |
| 123 | 76 |
| (47) |
Services |
| 36 | 62 |
| +27 |
Other Activities |
| (23) | (39) |
| (15) |
Total WCR excluding tax |
| 1,335 | 1,340 |
| +5 |
Corporate income tax |
| (11) | 7 |
| +17 |
Working capital requirement (WCR) |
| 1,324 | 1,346 |
| +23 |
The Group’s working capital requirement, after adjusting working capital in the Property Management for Individuals business in accordance with IFRS 5, stood at €1,346 million at year-end 2023, mainly due to the slowdown in business and thus in sales of inventory. Excluding tax and before the adjustment relating to IFRS 5, the working capital requirement declined €39 million.
It mainly consists of secure operating items (receivables due from individual clients guaranteed by banks, and receivables due from institutional clients relating to top-tier counterparties) and includes an almost 40% reduction in the land bank, which stood at €171 million at 31 December 2023.
CLIMATE AND BIODIVERSITY: STRONG PERFORMANCE IN 2023
In 2023, Nexity continued to roll out its ambitious strategy in support of resilient low-carbon cities, thus helping accelerate the sustainability transition in the real estate sector.
1.5°C carbon trajectory validated by SBTi (the Science Based Targets initiative) in July 2023, with the Group joining the Euronext CAC SBT 1.5 index
CDP score9 upgraded to A- “Leadership”, notably in recognition of the Group’s carbon reduction targets across its entire value chain and high-quality environmental reporting
Partnership between Nexity and the Net Zero Initiative for Real Estate, which aims to draw up guidelines so that the real estate sector helps achieve the global net-zero target
Lower carbon emissions – Regulatory requirements met or outperformed nearly two years ahead of time: The Group’s aim is to achieve a 42% reduction in its carbon impact per square metre delivered between 2019 and 2030, 10% above the level required by France’s RE2020 environmental regulations10. On average in 2023, the Group’s developments at building permit stage outperformed RE2020 requirements by 25% (representing the equivalent of 300,000 metric tons of CO2 avoided), thus meeting the new regulatory thresholds nearly two years ahead of time. This performance was notably made possible by the following:
Large-scale rollout of heat pumps as well as low-carbon and bio-sourced materials
Work on new construction processes and innovations pursued for many years, as seen in the low-carbon performance of the Athletes’ Village (60,000 square metres), at under 700 kg of CO2 per square metre
Nexity, at the forefront of biodiversity footprint measurement: The Group measured its biodiversity footprint for the first time in 2022 and identified actions across the entire real estate value chain (wood supplies, support from sustainability experts, etc.), which were included in the Act4Nature commitments, renewed in 2023 for 2024-2026.
A Climate and Biodiversity Report presenting the Group’s business strategy and implementation approach will be made available ahead of the Shareholders’ Meeting to be held in May 2024.
2023: A BUSY YEAR FOR REFOCUSING THE GROUP’S ROADMAP
Even before the persistent market downturn throughout 2023, Nexity had begun proactively concentrating on refocusing its roadmap, speeding up its execution, in line with the following announcements:
Discontinuation of business outside France:
Disposal of Polish and Portuguese subsidiaries completed in July and September 2023
Sale proceeds of around €100 million went towards deleveraging the Group
Pivoting more quickly towards urban regeneration:
Launch of Nexity Héritage, a subsidiary specialising in urban regeneration
First market deal aimed at upgrading 76 Carrefour sites and launching a land banking company:
The 76 sites to be regenerated total approximately 800,000 sq.m, and their development will lead to the creation of 12,000 homes, for estimated revenue of over €2 billion spread over 10 years.Land banking solution with Mirabaud AM: The land banking solution offered by Mirabaud AM will cover predominantly residential large-scale property renovation, transformation and/or refurbishment projects and will enable Nexity to outsource up to 90% of the carry risk, for a total investment of up to €200 million over 5 years.
Process initiated to seek out strategic and financial partnerships in management and distribution businesses:
At year-end 2023, Nexity entered into exclusive negotiations with a view to selling 100% of its Real Estate Services to Individuals activities to Bridgepoint, based on an enterprise value of €440 million.
This transaction involves a strategic partnership aimed at amplifying existing synergies with Nexity’s businesses and securing their long-term future.
2024: A YEAR OF FAR-REACHING TRANSFORMATION
Although interest rates now appear to have plateaued, the sector is likely to continue to face an unfavourable market environment in 2024.
After beating the market in 2023, backed by its solid liquidity, Nexity intends to step up actions to adjust its roadmap to adapt to changes in scope and the new market reality, including:
Finalisation of the first strategic and financial partnership dealing with real estate services in the first half of the year
Real Estate Services to Individuals activities to be sold to Bridgepoint in the first half of the year
The only closing condition for authorisation by the European Commission in respect of merger control was met on 20 February 2024.Proceeds from sale to be used to reduce the Group’s debt level, with the gains made on this transaction helping Nexity adapt more quickly to new market conditions
Transaction affecting around 3,100 employees11
Nexity also continuing to seek out strategic and financial partnerships for the Property Management for Companies and Distribution businesses
Far-reaching organisational transformation
Accelerated shift towards urban regeneration and managed real estate
Decentralised business model, adapted to local and regional planning priorities
Multi-product range of solutions and services adapted to emerging patterns of use
Adjustment of the Group’s workforce:
Rescaling the organisation to reflect the following:
Market environment and slowdown in private investment in residential and commercial real estate (with reservations recorded by Nexity down 25% with respect to the average over the past five years)
Changes in the product mix (with bulk sales continuing to make up more than 60% of total sales, compared with an average of 50% over the past five years)
Changes in the Group’s scope: disposal of international activities, and of the Property Management for Individuals business; continued search for strategic and financial partnerships
In view of its adaptation and transformation, the Group has decided to initiate in the coming weeks an information and consultation process with employee representative bodies before implementing a redundancy plan (PSE in French). As such, the Board proposes that the dividend in respect of financial year 2023 be suspended.12
Through these transformation initiatives, Nexity is aiming for improved profitability from 2025, and as a result, maximum net debt of €500 million at year-end 2025.
The dividend policy will be conducted so as to be consistent with the context and reviewed annually in light of free cash flow.
Thanks to an agile, deleveraged, regionally focused multi-product organisation, at the end of this year of transformation Nexity will be in a position to seize the opportunities offered by the impending change in the real estate cycle.
Forecast for 2024
Operating profit to remain positive while reaching a low point, taking into account gains on disposals, the costs of adjusting supply to new market conditions and costs relating to the Group’s reorganisation, paving the way for a rebound in 2025
Net financial debt considerably lower than at the end of 2023
*****
FINANCIAL CALENDAR & PRACTICAL INFORMATION
Q1 2024 revenue and business activity Thursday, 25 April 2024 (after market close)
Shareholders’ Meeting Thursday, 23 May 2024
2024 interim results Thursday, 25 July 2024 (after market close)
Q3 2024 revenue and business activity Thursday, 24 October 2024 (after market close)
A conference call will be held today in French, with simultaneous translation into English, at 6:45 p.m. (Paris time), which can be joined via the “Finance” section of our website, https://nexity.group/en/finance, or by calling one of the following numbers:
| +33 (0)1 70 37 71 66 |
| +44 (0)33 0551 0200 |
| +1 786 697 3501 |
Code: Nexity FR / Nexity EN
The presentation accompanying this conference will be available on the Group’s website from 6:30 p.m. (Paris time) and may be viewed at the following address: Nexity FY 2023 webcast
The conference call will be available on replay at www.nexity.group/en/finance from the following day.
Disclaimer:
Audit procedures by the Statutory Auditors for the consolidated financial statements are being finalised and the corresponding report will be issued shortly.
The information, assumptions and estimates that the Company could reasonably use to determine its targets are subject to change or modification, notably due to economic, financial and competitive uncertainties. Furthermore, it is possible that some of the risks described in Section 2 of the Universal Registration Document filed with the AMF under number D.23-0251 on 6 April 2023 could have an impact on the Group’s operations and the Company’s ability to achieve its targets. Accordingly, the Company cannot give any assurance as to whether it will achieve its stated targets, and makes no commitment or undertaking to update or otherwise revise this information.
Contact:
Géraldine Bop – Head of Financial Communications / +33 (0)6 23 15 40 56
Anne-Sophie Lanaute – Head of Investor Relations and Financial Communications / +33 (0)6 58 17 24 22
investorrelations@nexity.fr
Attachment
