19 Apr 2021 07:30
19 April 2021
Etalon Group Announces 1Q 2021 Operating Results
ETALON GROUP PLC ("Etalon Group" or the "Company"), one of Russia's largest and longest-established development and construction companies, announces its unaudited operating results for the three months ended 31 March 2021, based on management accounts.
1Q 2021 operating highlights
· The number of new contracts amounted to 1,989
· New contract sales amounted to 98,670 sqm and RUB 16.2 billion
· Cash collections rose by 2% year-on-year to RUB 18.0 billion
· Average price per sqm increased by 15% year-on-year to RUB 164.3 ths
· Average price per sqm of apartments grew by 26% year-on-year to RUB 208.1 ths
· Cash collections to escrow accounts reached RUB 4.9 billion
1Q 2021 operating results
1Q 2021 | 1Q 2020 | Change, % | |
New sales, sqm | 98,670 | 125,971 | (22%) |
New sales, mln RUB | 16,214 | 17,936 | (10%) |
Number of contracts | 1,989 | 2,323 | (14%) |
Cash collections, mln RUB | 18,036 | 17,604 | 2% |
Average price, RUB/sqm | 164,329 | 142,384 | 15% |
Average price (apartments), RUB/sqm | 208,095 | 165,481 | 26% |
Deliveries, sqm | 3,028 | 88,513 | (97%) |
Regional breakdown
1Q 2021 | 1Q 2020 | Change, % | |
Moscow Metropolitan Area | |||
New sales, sqm | 51,766 | 59,171 | (13%) |
New sales, mln RUB | 9,451 | 10,141 | (7%) |
Number of contracts | 1,030 | 1,122 | (8%) |
Cash collections, mln RUB | 9,861 | 9,324 | 6% |
Average price, RUB/sqm | 182,565 | 171,385 | 7% |
Average price (apartments), RUB/sqm | 230,041 | 207,899 | 11% |
Deliveries, sqm | 3,028 | 88,513 | (97%) |
St Petersburg | |||
New sales, sqm | 46,905 | 66,800 | (30%) |
New sales, mln RUB | 6,764 | 7,795 | (13%) |
Number of contracts | 959 | 1,201 | (20%) |
Cash collections, mln RUB | 8,175 | 8,281 | (1%) |
Average price, RUB/sqm | 144,203 | 116,696 | 24% |
Average price (apartments), RUB/sqm | 184,154 | 131,629 | 40% |
Deliveries, sqm | - | - | - |
Quarterly operating performance
1Q 2021 | 4Q 2020 | 3Q 2020 | 2Q 2020 | 1Q 2020 | |
New sales, sqm | 98,670 | 166,788 | 150,451 | 94,984 | 125,971 |
New sales, mln RUB | 16,214 | 26,418 | 23,983 | 11,585 | 17,936 |
Number of contracts | 1,989 | 3,137 | 2,706 | 1,559 | 2,323 |
Cash collections, mln RUB | 18,036 | 29,203 | 21,235 | 13,942 | 17,604 |
Average price, RUB/sqm | 164,329 | 158,392 | 159,405 | 121,971 | 142,384 |
Average price (apartments), RUB/sqm | 208,095 | 191,853 | 186,327 | 159,063 | 165,481 |
Deliveries, sqm | 3,028 | 347,396 | 15,570 | 88,847 | 88,513 |
Mortgage contract developments
1Q 2021 | 4Q 2020 | 3Q 2020 | 2Q 2020 | 1Q 2020 | |
Share of mortgages (total) | 37% | 44% | 47% | 44% | 36% |
Share of mortgages (apartments) | 63% | 65% | 64% | 63% | 52% |
Commenting on the 1Q 2021 operating results, Etalon Group CEO Gennadiy Shcherbina said:
"The slight decrease in sales volumes in 1Q 2021, following record results a year ago, is primarily due to the lower volume of real estate available for sale. The temporary shortage of supply had an insignificant impact on year-to-year performance indicators: new contract sales in the first three months of 2021 amounted to over RUB 16 billion. The average price per square metre rose 15% year-on-year to RUB 164 ths, generating RUB 18 billion in cash collections.
"In line with our plans to increase supply, we will be launching sales for the ZIL-Yug project and for new stages of the Nagatino i-Land project, which will contribute to stronger sales performance. In addition, the Company will launch sales at a business-class residential complex on Letnikovskaya Street in Moscow and expects to expand its offer by acquiring new projects, some of which we also plan to launch by the end of the year. Etalon is considering various ways to finance the purchase of land plots, including payment in several tranches and project financing.
"The launch of projects from the current portfolio and new acquisitions will help us fully compensate for the supply deficit and ensure stable growth by the end of 2021."
Etalon Group CFO Ilya Kosolapov added:
"Etalon Group maintained its strong financial position as of the end of March 2021. Net corporate debt decreased to RUB 16.1 billion. The ratio of net corporate debt to pre-PPA EBITDA remains at a comfortable level of 1x. At the same time, cash held in escrow accounts has reached RUB 28.5 billion, which enables the Company to continue to raise project financing at preferential rates, which vary from 3.5% to virtually 0% depending on the project. The 25 bp increase in the key rate did not have a significant impact on our cost of debt. The average interest rate on our debt portfolio is 7.05%, compared to 8.3% at the end of 2020. These metrics demonstrate that Etalon Group is in a comfortable position to replenish its land bank, while remaining confident in its ability to pay guaranteed dividends and fulfil the promises made to shareholders."
Conference call and webcast
The Company will host a conference call for investors and analysts today at 15:00 London time (17:00 Moscow; 10:00 New York).
On the call, the Etalon Group management team will present the Company's 1Q 2021 operating results, followed by a question and answer session for participants.
Webcast
https://edge.media-server.com/mmc/p/pzyf9c28
Dial-in numbers:
+44 2071 928338 - Standard International
+44 844 4819 752 - London
+7 495 249 9851 - Moscow
+1 646 741 3167 - New York
Conference ID Code: 8274196
This and other recent announcements are available on the Etalon Group website: https://www.etalongroup.com/investor-relations/investor-news/
Contact Information
Etalon Group
IR Team
T: +44 (0) 20 8123 1328
E: ir@etalongroup.com
EM
Sam VanDerlip
T.: +44 207 002 7859
E: vanderlip@em-comms.com
About Etalon Group
Founded in 1987, Etalon Group is one of the largest development and construction companies in Russia. The Company focuses on middle class residential real estate in the Moscow and St Petersburg metropolitan areas. With a more than 30-year history, Etalon Group has one of the longest and most successful track records in the Russian real estate industry. Since its foundation, Etalon Group has commissioned 7.5 million sqm of real estate.
The Company is vertically integrated, which helps it to control costs, quality and timing, as well as maintain best-in-class profitability. Etalon Group employs over 5,000 people, and its nationwide sales and marketing network covers 59 Russian cities.
In 2019, Etalon Group acquired and consolidated 100% in Leader-Invest, one of Moscow's largest residential developers by size of land bank and number of projects currently available for sale.
Etalon Group's total assets comprise 20 projects under development, unsold inventory at completed residential complexes and commercial properties, with total unsold NSA of 2.8 million sqm, as well as construction and maintenance division. Colliers International valued the Company's total assets at RUB 204 billion as of 31 December 2020.
In 2020, Etalon Group's new contract sales totalled 538 ths sqm, or RUB 79.9 billion. Deliveries in 2020 amounted to 540 ths sqm.
The Company's revenue in 2020 amounted to RUB 78.7 billion, with EBITDA of RUB 12.6 billion.
Etalon Group's GDRs have traded on the Main Market of the London Stock Exchange since 20 April 2011 and on the Level 1 quotation list of Moscow Exchange since 31 January 2020 under the ticker ETLN.