AEDAS Homes, has once again achieved its annual goals and is reporting the strongest annual results in its history for its 2023/24 fiscal year, which ended on 31 March. The company lifted net profit by 3.6%, to €109 million, and for the first time ever has broken the one-billion-euro threshold, generating €1.15 billion in revenue, up 24.4% over last year. Likewise, EBITDA climbed to €173 million (up 5.3%) and diluted earnings per share (EPS) reached €2.53 (up 4.5%), on the back of a 24.3% gross development margin for its Build To Sell (BTS) deliveries.
The company’s results are driven by the €1.15 billion in revenue generated in the period—one of the highest in the Spanish residential development sector— primarily from the delivery of 2,839 homes, up 4% year-on-year. Of these deliveries, 2,456 were BTS and handed over to individual customers (up 16%), and 383 units were from turnkey Build to Rent (BTR) projects, handed over to institutional clients. In total, the company generated €950 million in revenue from its BTS and BTR deliveries in the period (up 7.3%). The company’s asset-light Real Estate Services line delivered an additional 99 homes which, along with the fees billed to the different vehicles for which it provides end-to-end residential development services, generated additional revenue of €9 million. Finally, the sale of non-strategic land, per the company’s strategy of selectively rotating its landbank, coupled with the transfer of assets to two recently established co-investment vehicles in which AEDAS Homes has a minority stake, generated a combined total of €186 million in revenue.
“These operating and financial results provide confirmation of the company’s performance and underline our commitment to creating shareholder value”, remarked David Martínez, CEO of AEDAS Homes. Mr. Martínez further explained: “Our focus is on sustained, sustainable and efficient growth of our development business—growth that is supported by three business lines, which are Residential Development, Land Development and Land Sales, and Real Estate Services. This allows us to diversify our product offering, scale as needed, and optimize our use of capital”.
In this sense, the asset-light Real Estate Services division has had a positive impact on the revenue figure, thanks to the new co-investment ventures closed in the final quarter of the fiscal year, with €290 million of equity that will drive future business growth and is expected to improve ROE.
Cash generation capacity
The company’s growth is underpinned by a healthy balance sheet, with a treasury position that has increased to €290 million (up from €245 million last year), and €233 million in free cash flow.
As in past years, AEDAS Homes has a diversified debt structure, mostly maturing in the long term, and closed the year with a Loan To Value (LTV) below 20%, which is why the rating agencies, in their most recent updates, endorsed the strength of the company’s credit quality. In this way, the developer is able to maintain a stable, conservative capital structure.
Annual investment in land
Over the last fiscal year, the Spanish homebuilder was a leader in land investment, allocating €222 million (up 12% compared to last year) to acquire land with a development capacity of 2,564 new units. “AEDAS Homes has a liquid, diversified landbank in the most dynamic markets in Spain on which we can build over 14,200 homes and potentially generate around €6 billion in revenue,” Mr. Martínez pointed out. The CEO noted that the current landbank provides long-term coverage of the company’s delivery goals for the next 4.7 years, and at this point in time, he expects to keep investing over €150 million annually in new assets.
Committed to delivering attractive shareholder remuneration
In line with this strong set of financial results, the AEDAS Homes Board of Directors plans to propose the distribution of a total ordinary dividend of €107 million, equivalent to €2.49 per share, against 2023/24 profit at the upcoming Annual General Meeting on 24 July 2024. The company already paid an interim dividend of €2.25 per share on 26 March and therefore will make an additional payment of €0.24 per share at the end of July, after the AGM. The Board of Directors will also propose an extraordinary dividend of €2.01 per share against the share premium account, on the back of the company’s cash generation capacity over the past year, but without compromising its future investment capability or financial solvency. Therefore, if approved, the total shareholder remuneration through this avenue will surpass €190 million. With this full dividend payout, the company will have distributed more than €440 million in cash to its shareholders since fiscal year 2020.
Clear visibility: strong sales momentum
Having closed out fiscal year 2023/24 with dynamic levels of sales activity (up 15%), selling 2,503 units and generating approximately €962 million in new revenue in the period, the company has clear visibility on future goals. The Order Book at year-end was valued at €1.24 billion (3,367 units), with 67% of the units slated for delivery in 2024/25 and 37% of those slated for 2025/26 forward sold, and 77% of the company’s landbank (excluding projects committed to but not executed as of March 2024) is already active, meaning that it has close 9,900 units in production.
