(BFM Bourse) – The group saw its operating profit fall by 33% in 2023 and announced a job protection plan. Nexity also provides vague outlooks for 2024.
The largest real estate developer on the Paris coast, Nexity was hit hard by the sharp deterioration in the real estate market last year, due to the rise in interest rates.
“The crisis that our sector of activity is experiencing is unprecedented, both in its intensity, its duration and its global nature affecting supply and demand,” declared its CEO Véronique Bédague in the accompanying press release. the annual accounts.
The company’s 2023 results clearly bear the scars of this crisis. Its revenues fell by 9%, weighed down by the 13% plunge in turnover from residential real estate development. Reservations in this market segment fell by 19%, although Nexity indicates that this drop is lower than that of the market (-24%).
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Social plan and suspended dividend
Operating profit plummeted by 33%, again penalized by the 50% fall in this indicator in the residential sector, to reach 246 million euros, while the corresponding margin fell from 7.8% to 5.7%.
The profit logically fell to 19 million euros compared to 188 million euros in 2022.
The current crisis in real estate “imposes a new situation to which Nexity will adapt in an accelerated manner in 2024, by adjusting the parameters allowing the sale of the offer designed in the previous cycle, by sizing its organization to the new conditions of volume,” explained Véronique Bedague.
Consequently, the group has decided to launch a job protection plan and to suspend its dividend for 2023.
An even worse year 2024?
On the Paris Stock Exchange, Nexity shares collapsed by 23% around 12 p.m. on the Paris Stock Exchange. This fall in the title can also be explained by the very vague outlook provided by the group.
For 2024, Nexity indicates that the operating result will be “positive” but will mark “a financial low point” due in particular to reorganization costs and “costs of adjusting the offer to the new market situation”. But the company does not communicate precise figures.
“It is understandable that Nexity does not commit to a 2024 operating result when it is about to formally announce a significant reduction plan in its workforce. However, this lack of perspective can only worry the market”, judges the independent research firm AlphaValue.
The financial intermediary is also surprised by the level of debt targeted by the company in 2025, i.e. a maximum of 500 million euros. “We find it high,” he explains. AlphaValue estimates that the group could possibly request a “waiver” by the end of 2025, that is to say an adjustment of its commitments in terms of debt ratio to its creditors. Nexity is required to respect a level of net debt below 3.5 times its gross operating profit (Ebitda).
“Unsurprisingly, the annual results are difficult and 2024 will be even worse but some glimmers of hope are seen by management for a future improvement in commercial activity,” writes TP ICAP Midcap, which reiterated its advice to the purchase on value.
Julien Marion – ©2024 BFM Bourse
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