Balwin Properties Ltd. · JSE:BWN
Balwin Properties — FY2021 Earnings Presentation
36 slides from Balwin Properties's earnings presentation, May 2021
Slide 1: Results presentation for the year ended 28 February 2021
Your lifestyle our focus RESULTS PRESENTATION for the year ended 28 February 2021 1
Slide 2: Agenda
Agenda Operational Operating model, Looking forward Annexures overview governance & financial overview 2
Slide 3: Operational overview
OPERATIONAL overview Steve Brookes Chief Executive Officer The Polofields
Slide 4: Operational highlights
Operational highlights Greenlee SIX-STAR GREEN 5 552 APARTMENTS SOLD 20 269 APARTMENTS RATING IN 12 MONTH PERIOD EDGE CERTIFIED AWARDED TO THREE LIFESTLYE CENTRES PRE-SALES OF DEVELOPMENT 7 INTERNATIONAL AWARDS 2 499 PIPELINE ACHIEVED AT THE APARTMENTS FOR OF 62 288 APARTMENTS AFRICA AND ARABIA FUTU
Slide 5: Operational review
Operational review Unprecedented socio-economic and market conditions Construction activity adversely impacted for approximately 3 months (25% of year) Several processes implemented to mitigate impact of Covid-19 to record 7% decline in revenue Healthy sales recorded (5 522 apartments sold) with sal
Slide 6: Operational review (continued)
Operational review (continued) 2 499 apartments pre-sold for future financial years and thus not recorded in revenue Increased roll-out of Green Collection developments in line with strategic objectives Growth in development pipeline – 62 288 apartments across 28 developments representing an approxi
Slide 7: Covid-19 consideration
Covid-19 consideration Successful management of the impact of COVID-19 to date Navigation of challenging macro-economic conditions – record sales achieved Implemented measures to manage risk to all staff and personnel No disruptions on site beyond the lockdown period Careful management of supply cha
Slide 8: Monthly sales
Monthly sales Monthly Sales – March to February 1 000 750 500 FY2021 average sales 463 250 FY2020 average sales 203 0 MAR APR MAY JUN JUL AUG SEP OCT NOV DEC JAN FEB Sales - FY2021 Average - FY 2021 Sales - FY2020 Average - FY 2020 Note - sales include all apartments contracted and do not necessaril
Slide 9: Operating model, governance and financial overview
Operating model, governance and financial overview Jonathan Weltman Chief Financial Officer Greenpark
Slide 10: Operating model
Operating model Financial and operational success depends on continuous development Development of large-scale residential estates in key target nodes Selling approximately 25 apartments per location per month Targeting an average profit margin of approximately 35% over the lifecycle Mooikloof Eco E
Slide 11: Turnkey development model
Turnkey development model 11
Slide 12: Governance process: development opportunities
Governance process Development opportunities Development opportunities identified Munyaka Internal due diligence process followed: › Costs › Infrastructure › Zoning › Independent review of nodal residential demand Presented for approval to: › Executive Committee › Transactions Committee › Board for
Slide 13: Financial overview
Financial overview The Reid 7% 6% 19% R2.70 billion 2 546 R477.4 million REVENUE EBITDA APARTMENTS HANDED OVER 18% 19% 8% R336.4 million 71.47 cents 682.83 cents PROFIT FOR THE PERIOD HEADLINE EARNINGS NET ASSET VALUE PER SHARE PER SHARE Ballito Hills 13
Slide 14: Condensed consolidated statement of comprehensive income
Condensed consolidated statement of comprehensive income Audited Audited 12 months ended 12 months ended 28 February 2021 29 February 2020 R'000 R'000 Revenue 2 700 574 2 914 453 Cost of sales (1 979 598) (2 124 703) Gross profit 720 976 789 750 Other income 6 652 19 847 Operating expenses (265 178)
Slide 15: Apartments recognised in revenue
Apartments recognised in revenue APARTMENTS DEVELOPMENT BALWIN BRAND RECOGNISED IN REVENUE Apartments recognised in revenue JOHANNESBURG, WATERFALL by region Kikuyu Classic Collection 188 The Polofields Signature Collection 98 Munyaka Classic Collection 283 9% 27% Total 569 13% JOHANNESBURG EAST The
Slide 16: Financial review
Financial review Revenue Decreased by 7% - influenced by national lockdown of approximately 3 months, and delay in construction activities Average selling price remained consistent – price increases offset by change in mix of apartments and increased contribution of Green Collection developments Gro
Slide 17: Average selling price analysis
Average selling price analysis 28 February 2021 29 February 2020 Average Ave price % Number Average Number Apartment type price (R) change apartments price (R) apartments 1 Bedroom 874 161 1.5% 761 860 973 1 071 2 Bedroom 1 422 783 3.4% 582 1 376 112 607 3 Bedroom 1 693 695 4.8% 433 1 615 868 513 TO
Slide 18: Average selling price analysis
Average selling price analysis 28 February 2021 29 February 2020 Average Ave price % Number Average Number Apartment type price (R) change apartments price (R) apartments 1 Bedroom 1 448 686 - 30 - - 2 Bedroom 1 988 862 7.3% 58 1 853 296 71 3 Bedroom 2 477 320 14.5% 87 2 163 929 159 4 Bedroom 2 469
Slide 19: Average selling price analysis
Average selling price analysis 28 February 2021 29 February 2020 Average Ave price % Number Average Number Apartment type price (R) change apartments price (R) apartments 1 Bedroom 602 169 11.9% 196 538 170 107 2 Bedroom 775 830 7.6% 342 720 744 158 3 Bedroom 918 602 12.2% 56 819 001 25 TOTAL 594 29
Slide 20: Financial review
Financial review Operating expenses and other income Operating costs increased to R265.2 million, following the trend from interims Increased operational costs as a result of improved activity in Balwin Fibre Cost management remains a key focus area for management Decrease in other income – prior ye
Slide 21: Summarised statement of financial position
Summarised statement of financial position Audited as at Audited as at 28 February 2021 29 February 2020 R'000 R'000 Non-current assets 128 791 100 026 Current assets 5 272 372 4 507 714 Developments under construction 4 121 257 3 369 972 Cash and cash equivalents 336 533 476 532 Other current asset
Slide 22: Developments under construction
Developments under construction Audited as at Audited as at 28 February 2021 29 February 2020 R’000 R’000 Construction costs 1 635 145 1 307 511 Land and land contribution costs 2 014 029 1 560 221 Development rights 472 083 502 240 TOTAL 4 121 257 3 369 972 Developments under construction Developme
Slide 23: Funding structure
Funding structure Audited as at Audited as at 28 February 2021 29 February 2020 R'000 R'000 Total liabilities 2 198 543 1 656 350 Development loans and facilities * 1 901 489 1 419 696 Other non-current liabilities ** 135 225 102 805 Other current liabilities ** 161 829 133 849 Equity 3 202 620 2 95
Slide 24: Looking forward
LOOKING FORWARD Steve Brookes Chief Executive Officer The Blyde
Slide 25: The future
The future Focus on core development model within Classic, Signature and Green Collection brands Constant improvement of construction quality, customer experience and affordability Increased roll out of the Green development brand, including the Strategic Integrated Projects Focus on cash management
Slide 26: Q&A
Q&A Greenlee
Slide 27: Contact details
Contact details Stephen Brookes Jonathan Weltman Chief Executive Officer Chief Financial Officer Tel: +27 11 450 2818 Tel: +27 11 450 2818 27
Slide 28: Annexures
ANNEXURES Ballito Hills
Slide 29: Development pipeline as at February 2021
Development pipeline as at 28 February 2021 29
Slide 30: Development pipeline as at February 2021
Development pipeline as at 28 February 2021 30
Slide 31: Corporate overview
Corporate overview Specialist, national residential property developer of large-scale sectional title estates Focus on high quality, affordable apartments with an innovative and all inclusive lifestyle offering for clients Currently developing approximately 2 500 apartments per year – capacity is ap
Slide 32: Development brands: Classic Collection
Development brands Classic collection brand Quality, affordable build-to-sell product One-, two-, and three-bedroom four storey walk up apartments Prices range from R699 900 to R1 999 900 focusing on the middle income population Developments located in high density, high growth nodes across key metr
Slide 33: Development brands: Green Collection
Development brands Green collection brand Model targets a lower LSM market than the Classic Collection Pricing from R499 900 to R999 900 Developed on a phase-by-phase approach Distinctive architecture that is different to the Classic Collection but synonymous with Balwin quality Residents have acces
Slide 34: Development brands: Signature Collection
Development brands Signature collection brand Three elite model developments, The Polofields (Johannesburg, Waterfall), Paardevlei Lifestyle Estate (Western Cape, Somerset West) and Izinga Eco Estate (KwaZulu-Natal, Umhlanga) Apartments built to higher specifications Prices range from R1 999 900 to
Slide 35: Business model: annuity income
Business Model Annuity income Leverage off asset base and expanding service offering to clients Partnerships established to provide high-speed fibre connectivity and solar installation which generates renewable energy Complimentary to Balwin’s business model and enhance the lifestyle offering to cli
Slide 36: Investment case
Investment case High gross margin for a listed residential property developer due to in-house construction management, in-house sales and strong budget controls Long-term development pipeline in key strategic locations High barriers to entry – low levies and efficiencies obtained through economies o