9M 2020 business activity and revenue : Very good performance of Nexity during the first nine months of the year showing the strong resilience of its business model Paris Stock Exchange:NXI

9M 2020 enterprise exercise and income

• Robust development in our market shares for brand spanking new houses in France: +4.3 factors (16,4% in H1 2020 in comparison with 12,1% in H1 2019)
• New house reservations in France: 13,635 models representing €2,948 million (down 3% by quantity and up 4% by worth) 
• Industrial Actual Property order consumption: €230 million excluding VAT
• Growth backlog: €5.7 billion (up 12% from end-December 2019)
• Income: €2,737 million (down 2% from 9M 2019)

      
Steering for 2020 and 2021

2020 enterprise exercise

• New house reservations for Nexity: round 20,000 models, anticipated to considerably outperform the market
• Excessive degree of Industrial actual property new orders anticipated in This autumn

Monetary features

• Income of at the least €4.2 billion in 2020, with a present working margin of round 5%, reaching a low level
• For 2021, income development of at the least 10% relative to 2020 and a present working margin of at the least 7%
• Growth pipeline (backlog + land below choices) of round €20 billion
• Web monetary debt (earlier than lease liabilities) lower than €1.2 billion at 31 December 2020

This steerage relies on enterprise assumptions contemplating new lockdown measures however excluding an prolonged shutdown of building websites.

Alain Dinin, Chairman and CEO of Nexity, commented:

“After a begin to the 12 months marked by the shock of a widespread lockdown, Nexity noticed its enterprise exercise get better beginning in June, and this restoration has continued since then, with the second wave of the Covid-19 pandemic not considerably affecting our companies as we speak, though it has clearly weighed on French shopper confidence.

Our new house reservations within the first 9 months of the 12 months have been virtually equal by quantity to these recorded in 9M 2019 and have been even larger by worth. French housing demand remained excessive, and Nexity demonstrated its capability to fulfill this demand. The introduction of stricter financial institution situations weighed on the solvency of lower-income purchasers, however sturdy demand from institutional traders helped us offset this impression. Because of Nexity’s geographic distribution, the range of our merchandise and consumer sorts, and our land sourcing capability, we confirmed and expanded our management place in our market. The bottom-breaking settlement we signed with Gecina to develop 4,000 houses collectively illustrates this.

Within the workplace area market, Nexity has confirmed the regular growth of the programmes in its portfolio, secured by commitments made by high-calibre traders and customers, and is getting ready to reply to the brand new context with distinctive options that stand out with regard to their environmental efficiency, carbon footprint and integration of providers and consumer options.

With a brand new organisation², Nexity has entered a brand new section within the growth of our Property Administration for People actions, making the consumer our groups’ number-one precedence by creating shut relationships targeted on high quality of service, providing options tailor-made to every consumer profile, upgrading our digital instruments and increasing our geographic protection to bolster our native presence.

For Nexity – France’s number-one timber-frame developer and the primary operator to realize E3C2 certification for a industrial constructing, deeply dedicated to championing an environmentally accountable strategy – the now central function of vitality renovation confirms the relevance of our Property Administration for People companies, with almost 20,000 buildings managed on behalf of condominium house owners.

Based mostly on these parts, and barring the implementation of lockdown measures leading to an prolonged shutdown of building websites, we at the moment are able to specify our steerage:

• Round 20,000 new house reservations anticipated this 12 months
• Income of at the least €4.2 billion in 2020, and development of at the least 10% in 2021
• Present working margin of round 5% (low level) in 2020 and at the least 7% in 2021
• Growth pipeline of round €20 billion
• Web monetary debt at 31 December 2020 lower than €1.2 billion.

Lastly, Nexity has launched an evaluation of the efficiency and capability to create worth of the Group’s completely different enterprise traces and their relevance in providing our purchasers the expanded vary of providers they’re searching for, which shall be used to replace our strategic plan. This plan shall be offered to our completely different stakeholders once we publish our 2020 accounts.”

***

9M 2020 BUSINESS ACTIVITY

INDIVIDUAL CLIENTS 

Residential Actual Property

Within the first six months of 2020, the MALONE³ market totalled 57,732 reservations, down 26% with respect to end-June 2019. Market developments have been primarily held again by a provide deficit aggravated by the re-evaluation of native city planning insurance policies following the shift in energy that befell after the second spherical of native elections in France. This provide scarcity resulted in a rise in costs, even though they need to logically lower. On this context, Nexity demonstrated its resilience and its market share surged to 16.4%, 4 factors larger than at 30 June 2019 (12.1%).

For full-year 2020, Nexity anticipates a pointy downturn within the French marketplace for new houses⁴ (round 125,000 models, down round 25% in comparison with 2019), with a pointy decline within the retail gross sales sector because of the lockdown interval and the continuing public well being disaster, whereas bulk gross sales are anticipated to develop, spurred on by institutional traders’ urge for food for residential property. Nexity’s market share ought to proceed to develop because of its multi-product, multi-service and multi-brand technique; its geographical positioning, which is concentrated in Better Paris and main cities, the place underlying demand could be very buoyant; and its unrivalled providing of services, enabling the Group to fulfill the wants of all forms of purchasers.

At end-September 2020, internet new house reservations in France totalled 13,635 models for €2,948 million together with VAT, down 3% by quantity and up 4% by worth with respect to end-September 2019.

This enhance in reservations was primarily concentrated in bulk gross sales (up 55% relative to 9M 2019), and extra particularly the expansion in reservations made by institutional traders (which tripled relative to 9M 2019). This transformation mirrored Nexity’s capacity to adapt its providing to reply to this demand. The agency dedication signed with CDC Habitat in April 2020 for 7,450 housing models contributed to reservations for the interval (2,880 reservations at end-September 2020, greater than 2,000 of which ought to have notarial deeds of sale signed by the tip of the 12 months), however a rising variety of different institutional traders have additionally approached the Group. They embody Gecina, with which the Group signed an revolutionary partnership in early October⁵ to develop 4,000 new houses over a four-year interval in supply-constrained areas.

Conversely, retail gross sales have been decrease (down 28% from 9M 2019) amidst the general public well being disaster. First-time consumers have been additionally affected by the introduction of stricter situations for mortgage approval, regardless of financing phrases remaining extremely engaging (1.22% on common in September 2020). Particular person traders additionally confirmed a sure wait-and-see angle in view of the present financial scenario.

Within the third quarter of 2020 alone, reservations have been down 8% by quantity and up 2% by worth at 4,184 models and €925 million together with VAT, because of the provide deficit. Retail gross sales have been down 17% in comparison with Q3 2019, partially offset by a 7% enhance in bulk gross sales over the identical interval.

After together with subdivisions (901 models, down 28% in comparison with 9M 2019, according to the change noticed within the particular person consumer market) and worldwide gross sales (432 reservations, up 29% relative to 9M 2019), enterprise exercise for Residential Actual Property at end-September 2020 got here to 14,968 models reserved and €3,088 million together with VAT, down 4% by quantity and up 3% by worth relative to 9M 2019.

The typical value together with VAT of recent houses reserved by Nexity’s particular person purchasers at end-September 2020 was €241 thousand, up 6% in comparison with end-September 2019, due each to the rise within the common ground space per house (up 2%) and the typical value per sq. metre together with VAT (up 4%), amid a context of decrease volumes and provide scarcity.

The typical degree of pre-selling booked initially of building work was very excessive (76% at end-September 2020). The availability of houses on the market dropped again 18% from its degree at end-December 2019 to face at 7,271 models at end-September 2020, resulting from a very swift take-up interval of 4.1 months⁶ (in contrast with 5.1 months in 9M 2019). Unsold accomplished inventory (72 models) as a proportion of the whole provide on the market remained very low.

At end-September 2020, the enterprise potential for brand spanking new houses⁷ was down 7% from year-end 2019 and got here to 51,365 models. This represented potential income of €9.6 billion excluding VAT. This transformation mirrored the one-off impression of the spring lockdown and modifications in political management on the native authorities degree with respect to mission structuring. Together with subdivisions and worldwide operations, the enterprise potential of Residential Actual Property represented €12.1 billion in potential income excluding VAT.

Actual Property Companies to People

Property Administration for People

The portfolio of models below administration amounted to over 878,000 models at 30 September 2020, a slight lower (down 0.7% from end-December 2019. This portfolio stability was due partly to the postponement of annual conferences of condominium house owners that ought to have been held throughout the second quarter, which delayed the renewal of managing agent mandates.

Brokerage actions (lettings and gross sales by Nexity companies and Century 21 franchises) progressively returned to a passable degree of enterprise exercise, persevering with the sturdy restoration noticed in June 2020.

Serviced residences

Nexity Studéa had 124 scholar residences below administration at 30 September 2020, totalling greater than 15,000 models (remaining secure since end-December 2019). The advertising and marketing marketing campaign for the 2020/2021 college 12 months was not affected by the general public well being disaster. At end-September 2020, the occupancy charge returned to its regular degree and got here to 98%.

Domitys opened 10 new residences for the reason that starting of the 12 months, bringing its portfolio to 110 serviced residences and over 12,500 residential models. At end-September 2020, the rolling 12-month occupancy charge was 85%, representing a slight enhance relative to end-December 2019 (84%).

Distribution actions

Within the interval to end-September 2020, iSelection and PERL recorded 2,700 reservations (down 21% in comparison with 9M 2019). This lower was according to the contraction of the person investor market.

COMMERCIAL CLIENTS – NEXITY ENTERPRISE SOLUTIONS⁸ 

Industrial Actual Property

Because of the general public well being disaster, take-up of workplace area within the Paris area and the general quantity of funding in industrial actual property in France within the interval to end-September 2020 decreased sharply (down 46% and 33%, respectively, relative to 9M 2019).

Order consumption within the first 9 months of 2020 was €230 million excluding VAT.

Enterprise potential for Industrial Actual Property⁶ totalled €2.8 billion at end-September 2020 (down 6% from year-end 2019). This consists of the La Garenne-Colombes eco-business park mission for roughly one billion euros (Nexity’s share), which has been secured below a purchase order settlement since This autumn 2019 and remains to be scheduled to be offered within the fourth quarter.

Actual Property Companies to Firms

At end-September 2020, the amount of models below administration totalled 19.5 million sq.m, secure with respect to year-end 2019.

At end-September 2020, Morning – a number one participant within the Paris coworking area market – operated 24 coworking areas totalling greater than 55,000 sq.m and equivalent to round 6,500 workstations. Given the size of lease phrases, and according to our expectations, the occupancy charge was barely decrease than in June 2020 (69% versus 77%).

BACKLOG AND BUSINESS POTENTIAL AT 30 SEPTEMBER 2020

The Group’s backlog at end-September 2020 stood at €5,719 million (€5,397 million for Residential Actual Property and €321 million for Industrial Actual Property).

Moreover, growth enterprise potential at end-September 2020 totalled over €14.9 billion in income (€12.1 billion for Residential Actual Property and €2.8 billion for Industrial Actual Property), offering the Group with excessive visibility on its future enterprise ranges.

SOCIAL AND ENVIRONMENTAL RESPONSIBILITY

The general public well being disaster and the spring lockdown revealed or accelerated a number of pre-existing underlying developments in the true property market: the will to be nearer to nature; the necessity for modular, versatile dwelling areas and workspaces; the rise of sustainable transport; and considerations about indoor air high quality.

Nexity is dedicated to creating cities inclusive and sustainable and goals to reply to its completely different Shoppers’ wants with rapid, real-world options tailored to the present context, in addition to extra long-term options for which the Group plans to speed up the event and/or widespread rollout.

The Group needs to incorporate entry to nature in its residential actual property programmes. Right this moment, 90% of programmes delivered embody exterior dwelling area and entry to non-public or shared inexperienced area. Finally the Group goals to make this 100%.

For a variety of years Nexity has provided its condominium proprietor purchasers tailor-made vitality renovation options to assist them actively handle bills whereas enhancing on a regular basis consolation and the worth of their property. On this regard, the French authorities’s vitality stimulus plan ought to increase the Group’s actions.

Nexity’s dedication to pursuing an bold low-carbon coverage was illustrated specifically by the completion of the Palazzo Good Méridia, France’s tallest timber-frame workplace constructing with E+C- (positive-energy, low-carbon) certification, which is the primary industrial constructing in France to acquire the E3C2 degree.

In September 2020, Nexity obtained Nice Place to Work certification for the Group in France, recognising its strategy taken for a variety of years targeted on making the Group an employer of alternative.

9M 2020 CONSOLIDATED REVENUE – OPERATIONAL REPORTING⁹

Income for the primary 9 months of 2020 was €2,737 million, down €68 million or 2% in comparison with 9M 2019, versus the 7% drop in H1 2020 in comparison with H1 2019. This transformation resulted from a wonderful efficiency achieved within the third quarter (€1,021 million, up 6% relative to Q3 2019).

* Income generated by Residential Actual Property and Industrial Actual Property from VEFA off-plan gross sales and CPI growth contracts is recognised utilizing the percentage-of-completion technique, i.e. on the premise of notarised gross sales and pro-rated to replicate the progress of all inventoriable prices.

Income for the Residential Actual Property division was down €157 million or 9% relative to 9M 2019. Within the third quarter alone, income was up 12% with respect to Q3 2019 and mirrored enterprise exercise beginning up once more after the lockdown interval. Income generated by the German subsidiary Pantera, acquired in March 2020, was not important over the interval.

Actual Property Companies to People posted income of €652 million for the interval ended 30 September 2020 (secure with respect to 9M 2019). Within the third quarter alone, income was up 6% with respect to Q3 2019. Progress within the portfolio of serviced residences and the sturdy restoration in distribution actions (up 13% in Q3 2020) offset decrease enterprise exercise in Property Administration for People and franchises (down 2% in Q3 2020).

Income development in Industrial Actual Property (up €86 million or 31% in comparison with 9M 2019) primarily arose from the sale of the finished Affect 2.0 constructing in Saint-Ouen (Seine-Saint-Denis)¹⁰ within the second quarter.

Income from Actual Property Companies to Firms amounted to €76 million, up €7 million. Whereas Morning posted income development for the primary 9 months of the 12 months (€5 million), income was affected by decrease occupancy charges at its shared workspaces than firstly of the 12 months, following the lockdown interval.

REVENUE UNDER IFRS

In IFRS phrases, income to end-September 2020 totalled €2,554 million, down 4% relative to 9M 2019. This determine excludes income from joint ventures, in accordance with IFRS 11, which requires joint ventures – proportionately consolidated within the Group’s operational reporting – to be accounted for utilizing the fairness technique.

GUIDANCE FOR 2020 AND 2021

Nexity has good visibility, with a backlog of almost €6 billion, enterprise potential totalling almost €15 billion in growth income, and a robust money place, with €919 million in money and €355 million in confirmed undrawn financial institution borrowing services. The Group, which suspended its steerage on 7 April 2020, has specified its steerage for 2020 and 2021, inside the still-fraught context of the general public well being disaster contemplating the implementation of lockdown measures however excluding an prolonged shutdown of building websites:

2020 enterprise exercise

• New house reservations for Nexity: round 20,000 models, anticipated to considerably outperform the market
• Excessive degree of Industrial actual property new orders anticipated in This autumn

Monetary features

• Income of at the least €4.2 billion in 2020, with a present working margin of round 10%, reaching a low level
• For 2021, income development of at the least 5% relative to 2020 and a present working margin of at the least 7%
• Growth pipeline (backlog + land below choices) of round €20 billion
• Web monetary debt (earlier than lease liabilities) lower than €1.2 billion at 31 December 2020.

FINANCIAL CALENDAR & PRACTICAL INFORMATION

A convention name on 9M 2020 income and enterprise exercise shall be held as we speak in English at 6:30 p.m. CET, which can be accessed utilizing code 1236373 by calling one of many following numbers:

The presentation accompanying this convention shall be obtainable on the Group’s web site from 6:15 p.m. CET and could also be seen on the following deal with: https://orange.webcasts.com/starthere.jsp?ei=1385552&tp_key=f1f7879e9b

The convention name shall be obtainable on replay at https://www.nexity.fr/en/group/finance from the next day.

Disclaimer

The knowledge, assumptions and estimates that the Firm might moderately use to find out its targets are topic to vary or modification, notably resulting from financial, monetary and aggressive uncertainties. Moreover, it’s attainable that a number of the dangers described in Part 2 of the Common Registration Doc filed with the AMF below quantity D.20-0280 on 9 April 2020, as revised by an modification filed with the AMF on 28 April 2020, might have an effect on the Group’s operations and the Firm’s capacity to realize its targets. Accordingly, the Firm can not give any assurance as as to if it is going to obtain its said targets and makes no dedication or endeavor to replace or in any other case revise this data.

AT NEXITY, WE AIM TO SERVE ALL OUR CLIENTS AS THEIR REAL ESTATE NEEDS EVOLVE

With greater than 11,000 workers and €4.5 billion in income, Nexity is France’s main built-in actual property group, with a nationwide presence and enterprise operations in all areas of actual property growth and providers for people, corporations and native authorities.
Our providers platform is designed to serve all our purchasers as their actual property wants evolve.
Firmly dedicated to specializing in folks and the way they’re related with one another, their cities and the surroundings, Nexity was ranked the number-one low-carbon actual property developer in France by BBCA in 2019, is a member of the Bloomberg Gender-Equality Index (GEI) and obtained Nice Place to Work certification in 2020.
Nexity is listed on the SRD, Euronext’s Compartment A and the SBF 120.

CONTACTS
Domitille Vielle – Head of Investor Relations / +33 (0)1 85 55 19 34 – investorrelations@nexity.fr
Géraldine Bop – Deputy Head of Investor Relations / +33 (0)1 85 55 18 43 – investorrelations@nexity.fr

ANNEX 1: OPERATIONAL REPORTING

Reservations: Residential Actual Property

Actual Property Companies to People

QUARTERLY FIGURES

Reservations: Residential Actual Property

Income

Backlog

ANNEX 2: BREAKDOWN BETWEEN DEVELOPMENT AND SERVICES

To supply an extra instrument for analysing its operational efficiency, the Group additionally supplies a breakdown of its income by enterprise line, separating its Actual Property Growth actions (Residential Actual Property and Industrial Actual Property) from its Companies companies (Property Administration for People together with franchises, serviced residences, distribution actions and Actual Property Companies to Firms).

Income

* Income generated by Residential Actual Property and Industrial Actual Property from VEFA off-plan gross sales and CPI growth contracts is recognised utilizing the percentage-of-completion technique, i.e. on the premise of notarised gross sales and pro-rated to replicate the progress of all inventoriable prices.

GLOSSARY

Enterprise potential: The overall quantity of potential enterprise at any given second, expressed as a variety of models and/or income excluding VAT, inside future tasks in Residential Actual Property (New houses, Subdivisions and Worldwide) in addition to Industrial Actual Property, validated by the Group’s Committee, in all structuring phases, together with the programmes of the Group’s city regeneration enterprise (Villes & Projets); this enterprise potential consists of the Group’s present provide on the market, its future provide (mission phases not but marketed on bought land, and tasks not but launched related to land secured by choices)

Present working revenue: Contains all working revenue gadgets aside from gadgets ensuing from uncommon, irregular and sometimes occurring transactions. Particularly, impairment of goodwill just isn’t included in present working revenue

Growth backlog (or order e book): The Group’s already secured future income, expressed in euros, for its Residential Actual Property and Industrial Actual Property companies. The backlog consists of reservations for which notarial deeds of sale haven’t but been signed and the portion of income remaining to be generated on models for which notarial deeds of sale have already been signed (portion remaining to be constructed)

EBITDA: Outlined by Nexity as equal to present working revenue earlier than depreciation, amortisation and impairment of non-current belongings, internet modifications in provisions, share-based fee bills and the switch from stock of borrowing prices instantly attributable to property developments, plus dividends acquired from equity-accounted investees whose operations are an extension of the Group’s enterprise. Depreciation and amortisation consists of right-of-use belongings calculated in accordance with IFRS 16, along with the impression of neutralising inner margins on disposal of an asset by growth corporations, adopted by take-up of a lease by a Group firm

EBITDA after lease funds: EBITDA internet of bills recorded for lease funds which are restated to replicate the applying of IFRS 16 Leases

Free money movement: Money generated by working actions after considering tax paid, monetary bills, modifications in WCR, dividends acquired from corporations accounted for below the fairness technique and internet investments in working belongings, and earlier than compensation of lease liabilities

Gearing: Web debt divided by consolidated fairness

Joint ventures: Entities over whose actions the Group has joint management, established by contractual settlement. Most joint ventures are Residential or Industrial Actual Property developments undertaken with one other developer (co-developments)

Land financial institution: The quantity of tasks in France for which the Group has acquired growth rights, earlier than acquiring a constructing allow and in some instances different planning permissions, expressed as an quantity recognised inside the working capital requirement

MALONE (Marché du Logement Neuf): New house market in France, calculated by including collectively the variety of retail gross sales (supply: French Commissioner-Common for Sustainable Growth – CGDD) and bulk gross sales (supply: French Federation of Actual Property Builders – FPI)

Web revenue earlier than non-recurring gadgets: Group share of internet revenue restated for non-recurring gadgets akin to change in truthful worth changes in respect of the ORNANE bond difficulty and gadgets included in non-current working revenue (any goodwill impairment losses, remeasurement of equity-accounted investments following the belief of management)

Operational reporting: In accordance with IFRS however with joint ventures proportionately consolidated. This presentation is utilized by administration because it higher displays the financial actuality of the Group’s enterprise actions

Order consumption – Industrial Actual Property: The overall of promoting costs excluding VAT as said in definitive agreements for Industrial Actual Property programmes, expressed in euros for a given interval (notarial deeds of sale or growth contracts)

Property Administration for People (PMI): Administration of rented properties on behalf of particular person purchasers (administration for the proprietor of all relations with the tenant, administration of the sale of the property if relevant) in addition to the administration of the widespread areas of condo buildings (as a managing agent) on behalf of condominium house owners. This additionally consists of brokerage actions

Reservations by worth (or anticipated income from reservations) – Residential Actual Property: The online whole of promoting costs together with VAT as said in reservation agreements for growth programmes, expressed in euros for a given interval, after deducting all reservations cancelled throughout the interval

Residences open for greater than 2 years (Domitys): Residences open since 1 January 2018

The monetary knowledge and indicators used on this press launch – together with forward-looking data – are primarily based on Nexity’s operational reporting with joint ventures proportionately consolidated.

² See press launch of 21 October 2020

³ French marketplace for new houses, together with bulk gross sales. Supply: ECLN for retail gross sales and FPI for bulk gross sales

⁴ See glossary on web page 11

⁵ See press launch of 1 October 2020

⁶ Take-up interval: Obtainable market provide / Reservations for the final 12 months, expressed in months

⁷ See glossary on web page 11

⁸ Supply of market knowledge: Immostat

⁹ See glossary on web page 11

¹⁰ See press launch of 17 April 2020

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