Bellway P.l.c. · LSE:BWY
Bellway P.l.c — FY2012 Earnings Presentation
66 slides from Bellway P.l.c's earnings presentation, Oct 16, 2012
Slide 1: Bellway p.l.c. Results Presentation
Bellway p.l.c. Results Presentation for year ended 31 July 2012
Slide 2: Highlights
Highlights Homes sold up 6.2% to 5,226 ASP up 6.3% to £186,648 Total turnover up 13.3% to £1,004.2m Operating margin up 290 bps to 11.4% Profit before tax up 56.8% to £105.3m Net asset value increased to 933p Earnings per share increased by 57.8% to 65.5p Net bank debt of £40.6m Fo
Slide 3: Notes
Notes Results presentation 16 October 2012 - Page 3 -
Slide 4: Turnover
Turnover For the year ended 31 July 2012 2011 % Homes sold 5,226 4,922 6.2% Average sales price £186,648 £175,613 6.3% Housing turnover £975.4m £864.4m 12.8% Other turnover £28.8m £21.7m 32.7% Total turnover £1,004.2m £886.1m 13.3% Results presentation 16 October 2012 - Page 4 -
Slide 5: Notes
Notes Results presentation 16 October 2012 - Page 5 -
Slide 6: Sales statistics
Sales statistics For the year ended 31 July 2012 2011 % Private housing Homes sold 4,358 3,843 13.4% Average selling price £200,287 £191,492 4.6% Social housing Homes sold 868 1,079 (19.6%) Average selling price £118,171 £119,057 (0.7%) Results presentation 16 October 2012 - Page 6 -
Slide 7: Notes
Notes Results presentation 16 October 2012 - Page 7 -
Slide 8: Sales statistics
Sales statistics For the year ended 31 July 2012 2011 Bedroom analysis 100% 3% 3% Houses vs Flats 90% 17% 22% 80% Houses 69% 66% 70% 54% 59% 34% Apartments 31% 34% 60% 34% 50% 40% 30% 36% 32% Size 20% 10% Av. Sq. feet / home 951 931 9% 10% 0% July 12 July 11 ASP / square foot £196 £189 1 2 3 4 4+ Re
Slide 9: Notes
Notes Results presentation 16 October 2012 - Page 9 -
Slide 10: Sales statistics
Sales statistics For the year ended 31 July Selling price 2012 2011 Up to £100,000 15% 15% £100,001 to £150,000 30% 36% £150,001 to £200,000 22% 21% £200,001 to £250,000 14% 13% Over £250,000 19% 15% Results presentation 16 October 2012 - Page 10 -
Slide 11: Notes
Notes Results presentation 16 October 2012 - Page 11 -
Slide 12: Operating performance
Operating performance For the year ended 31 July 2012 2011 Gross margin 16.1% 13.5% Admin. expenses (4.7%) (5.0%) Operating margin 11.4% 8.5% Operating profit £114.6m £75.2m Results presentation 16 October 2012 - Page 12 -
Slide 13: Notes
Notes Results presentation 16 October 2012 - Page 13 -
Slide 14: Finance expense
Finance expense For the year ended 31 July 2012 2011 Net bank interest payable inc. fees £4.7m £2.8m Preference dividend £1.9m £1.9m Land creditors / debtors – IAS 39 £3.0m £3.1m Employee benefits £0.5m £0.4m Other interest (£0.8m) (£0.2m) Net finance expense £9.3m £8.0m Average net bank debt £21.9m
Slide 15: Notes
Notes Results presentation 16 October 2012 - Page 15 -
Slide 16: Earnings and dividends
Earnings and dividends For the year ended 31 July 2012 2011 Profit before tax £105.3m £67.2m Effective taxation rate 24.7% 25.3% Earnings per share 65.5p 41.5p Dividend per ordinary share 20.0p 12.5p Dividend cover 3.3 3.3 Average number of ordinary shares 121.0m 120.7m Results presentation 16 Octob
Slide 17: Notes
Notes Results presentation 16 October 2012 - Page 17 -
Slide 18: Capital employed
Capital employed as at 31 July 31 July 2012 2011 Fixed assets £21.2m £17.9m Stocks £1,399.8m £1,270.3m Shared equity £35.1m £33.5m Debtors £74.4m £65.9m Net cash - £3.4m Pension deficit (£11.5m) (£8.4m) Creditors (£204.7m) (£206.1m) Land creditors (£120.6m) (£83.2m) Capital employed £1,193.7m £1,093
Slide 19: Notes
Notes Results presentation 16 October 2012 - Page 19 -
Slide 20: Stocks
Stocks as at 31 July 31 July 2012 2011 Land with planning £687.6m £646.9m Land pending planning £165.3m £114.8m Work in progress £479.5m £439.7m Showhomes £45.5m £45.6m Part exchange stock £21.9m £23.3m Total £1,399.8m £1,270.3m Results presentation 16 October 2012 - Page 20 -
Slide 21: Notes
Notes Results presentation 16 October 2012 - Page 21 -
Slide 22: Land with planning
Land with planning Average Plots Cost plot cost Brought forward 1 August 2011 18,086 £646.9m £35.8k Sold (5,226) (£243.4m) £46.6k 12,860 £403.5m £31.4k Net purchases 4,776 £284.1m £59.5k Carried forward 31 July 2012 17,636 £687.6m £39.0k Results presentation 16 October 2012 - Page 22 -
Slide 23: Notes
Notes Results presentation 16 October 2012 - Page 23 -
Slide 24: Shared equity
Shared equity as at 31 July 31 July 2012 2011 Number of assets owned 2,728 2,428 Book value (BV) £35.1m £33.5m Original loan (OL) £74.6m £69.5m BV / OL 47% 48% Cumulative redemptions to date (units) 232 201 Cumulative redemption proceeds as % of OL 72% 73% Results presentation 16 October 2012 - Page
Slide 25: Notes
Notes Results presentation 16 October 2012 - Page 25 -
Slide 26: Finance
Finance as at 31 July 31 July 2012 2011 Net bank (borrowings) / cash (£40.6m) £3.4m Preference debt (£20.0m) (£20.0m) Net debt (£60.6m) (£16.6m) Gearing 5.3% 1.5% Net assets £1,133.1m £1,073.3m Results presentation 16 October 2012 - Page 26 -
Slide 27: Notes
Notes Results presentation 16 October 2012 - Page 27 -
Slide 28: Cash flow
Cash flow £6.2m For the year ended 31 July 450 422.3 (71.3) 400 (39.8) 350 (305.0) 300 250 £m 200 150 100 50 3.4 (29.3) (3.0) (17.9) (40.6) - (50) Opening Cash from Change in Investment Land Interest and Investing & Dividend Closing net cash operations working in WIP acquisitions tax Financing bank
Slide 29: Notes
Notes Results presentation 16 October 2012 - Page 29 -
Slide 30: Anticipated completion mix
Anticipated completion mix For the year ended 31 July July 11 c. 27% c. 46% c. 27% July 12 c. 17% c. 28% c. 55% July 13 c. 15% c. 23% c. 62% July 14 c. 10% c. 21% c. 50% c. 18% July 15 c. 7% c. 18% c. 29% c. 45% 0% 20% 40% 60% 80% 100% Plots w ith provision (c. 5.5%) Plots w ithout provision New ly
Slide 31: Notes
Notes Results presentation 16 October 2012 - Page 31 -
Slide 32: Improving shareholder return
Improving shareholder return Improvement in shareholder return achieved by maintaining annual dividend payment and; Capital and earnings growth through continuation of three pronged strategy of increasing:- – Volumes – Average selling prices – Operating margins Results presentation 16 October 20
Slide 33: Notes
Notes Results presentation 16 October 2012 - Page 33 -
Slide 34: Volume growth
Volume growth Average increase of 6.1% over last 3 years Average outlets up from 195 to 208 5,250 6.2% 5,000 Private completions up 7.1% by 13.4% driven by 4,750 stronger southern 4.9% 5,226 market 4,500 4,922 (33.2%) 4,595 Volume increase 4,250 4,380 achieved despite fall in social completion
Slide 35: Notes
Notes Results presentation 16 October 2012 - Page 35 -
Slide 36: Volume growth
Volume growth Aim to increase output again this year Five divisions with volume of 350 or less Hope to increase outlets and hence volume by around 5% Results presentation 16 October 2012 - Page 36 -
Slide 37: Notes
Notes Results presentation 16 October 2012 - Page 37 -
Slide 38: Volume growth
Volume growth Existing capacity of 6,500 units Growth without compromising capital disciplines or significantly increasing overhead Geographical expansion beyond 13 existing divisions as market permits Results presentation 16 October 2012 - Page 38 -
Slide 39: Notes
Notes Results presentation 16 October 2012 - Page 39 -
Slide 40: ASP growth
ASP growth Average increase of 6.6% over last 3 years Growth due to changes in product and 190.0 geographical mix 6.3% 180.0 63% of housing 7.6% turnover from south 170.0 186.6 6.0% Over 900 homes 160.0 175.6 completed in London (9.3%) 163.2 boroughs 154.0 150.0 July 09 July 10 July 11 July 12
Slide 41: Notes
Notes Results presentation 16 October 2012 - Page 41 -
Slide 42: ASP growth - Hale Village
ASP growth - Hale Village 140 private units. Adjacent Tottenham Hale underground. Site acquired in July 2010 with DPP. Hope to be off site by July 2013. 10 storey development. 1, 2 and 3 bedroom apartments. £210k average selling price. Results presentation 16 October 2012 - Page 42 -
Slide 43: Notes
Notes Results presentation 16 October 2012 - Page 43 -
Slide 44: ASP growth
ASP growth Northern ASP strengthened by:- – Completions from recent land acquisitions, especially in north west – Fewer housing association completions Looking ahead more changes in mix should lead to further ASP growth Results presentation 16 October 2012 - Page 44 -
Slide 45: Notes
Notes Results presentation 16 October 2012 - Page 45 -
Slide 46: Sales summary
Sales summary For the year ended 31 July 2012 2011 % North Homes sold 2,375 2,345 1.3% Average selling price £151,376 £144,447 4.8% South Homes sold 2,851 2,577 10.6% Average selling price £216,031 £203,973 5.9% Results presentation 16 October 2012 - Page 46 -
Slide 47: Notes
Notes Results presentation 16 October 2012 - Page 47 -
Slide 48: Completion analysis
Completion analysis For the year ended 31 July 2012 2011 1035, 20% 1079, 22% 868, 17% 791, 16% 436, 9% 702, 13% 288, 6% 40, 1% 337, 7% 630, 13% 226, 4% 149, 3% 105, 2% 1500, 30% 1962, 37% Second time buyers Shared equity Other buyers Other second time buyers Bellway shared equity Housing association
Slide 49: Notes
Notes Results presentation 16 October 2012 - Page 49 -
Slide 50: Operating margin growth
Operating margin growth Strong control of administrative costs Stable build costs 55% of legal completions from newly acquired land Results presentation 16 October 2012 - Page 50 -
Slide 51: Notes
Notes Results presentation 16 October 2012 - Page 51 -
Slide 52: Build costs
Build costs Overall costs are stable Labour cost base up 0.5% to 1% Some material cost pressures Regulatory cost pressures going forward must be accounted for in land acquisition Results presentation 16 October 2012 - Page 52 -
Slide 53: Notes
Notes Results presentation 16 October 2012 - Page 53 -
Slide 54: Land buying
Land buying £305m expended on land 4,776 added to top tier of land bank – 2,304 plots acquired with DPP – 2,472 plots promoted from pipeline Results presentation 16 October 2012 - Page 54 -
Slide 55: Notes
Notes Results presentation 16 October 2012 - Page 55 -
Slide 56: Eastleigh
Eastleigh Aerial view of site Cable factory in Southampton Results presentation 16 October 2012 - Page 56 -
Slide 57: Notes
Notes Results presentation 16 October 2012 - Page 57 -
Slide 58: Barking Riverside
Barking Riverside Barking Riverside street scene Aerial view showing photo voltaic roofs Results presentation 16 October 2012 - Page 58 -
Slide 59: Notes
Notes Results presentation 16 October 2012 - Page 59 -
Slide 60: Land bank
Land bank as at 31 July 31 July 2012 2011 3 levels to our land bank DPP: Plots owned with planning 17,636 18,086 Pipeline: Plots pending planning 13,500 13,000 Total plots 31,136 31,086 Strategic: Long term potential plots >3,900 >3,600 Heads of terms agreed on further 4,700 plots Results presentati
Slide 61: Notes
Notes Results presentation 16 October 2012 - Page 61 -
Slide 62: Market place
Market place Averaged 101 sales per week – up 8.6% Cancellation rates stable at 13% In first 9 weeks:- – Sales volumes up 7.3% – Sales value up 10.8% Results presentation 16 October 2012 - Page 62 -
Slide 63: Notes
Notes Results presentation 16 October 2012 - Page 63 -
Slide 64: Outlook
Outlook NewBuy has accounted for 6.3% of reservations since launch Effect of government lending initiatives still unknown Order book now at £438.4m representing 2,486 plots 55% of order book contracted Results presentation 16 October 2012 - Page 64 -
Slide 65: Notes
Notes Results presentation 16 October 2012 - Page 65 -
Slide 66: The Water Tower, Lambeth
The Water Tower, Lambeth Results presentation 16 October 2012 - Page 66 -