- In the first quarter of 2024, Develia Group’s sales revenue amounted to PLN 401.6 million, which represents a 56% increase compared to PLN 257.2 million in the same period of the previous year.
- The group’s net profit amounted to PLN 84.4 million compared to a net profit of PLN 58 million in the first quarter of 2023, which is 45% more.
- In the period from January to March 2024, the developer sold 1,038 units, recording a record quarterly result, and handed over 598 apartments.
- As of the end of March 2024, Develia had a total of PLN 662.2 million in cash, short-term financial assets, and other financial assets compared to PLN 703.4 million at the end of 2023.
– After a record-breaking 2023, we have started the new year strongly, recording very good sales and financial results. The highest quarterly sales to date were supported by a high number of reservations from the end of last year related to the conclusion of the “Safe Credit 2%” program. Many of these converted into developer agreements in the first quarter of this year. After the first months of the year, we feel comfortable with achieving the sales and handover targets we set for 2024, – said Andrzej Oślizło, President of Develia. – In the first quarter, we worked on a new strategy for the Develia Group, which we announced in April. Our priority is further dynamic growth in the residential sector and increasing market share in the cities we currently operate in to 7-8%. As part of diversifying our activities, we will develop in the PRS and student housing segments, which aligns with the joint venture agreement we signed with our partner at the beginning of the year, added Andrzej Oślizło.
Development Activities
In the first quarter of this year, Develia sold 1,038 apartments compared to 533 in the first quarter of 2023, which represents a 95% increase. The most apartments were sold in the Aleje Praskie and Bemowo Vita projects in Warsaw, City Vibe in Kraków, and Przemyska Vita in Gdańsk. Develia also sold 30 units in the Lizbońska projects in Saska Kępa and Ursynów #22 in Warsaw, carried out in cooperation with the developer Grupo Lar. At the end of April this year, Develia signed an annex to the joint venture agreement with Grupo Lar Holding Polonia and Lar Management Polonia, expanding the cooperation to include an investment of approximately 550-600 apartments in Praga Południe in Warsaw.
In the January-March period, Develia handed over 598 apartments compared to 441 units a year earlier. The management’s goal is to hand over 2,700-2,900 apartments in 2024.
Commercial Activities
Following the signing of the preliminary sales agreement for Arkady Wrocławskie at the end of 2023, Develia continued efforts to close the facility in the first quarter of this year. The end of operational activities at the shopping center is planned for the second quarter of this year. The finalization of the sale transaction of Arkady Wrocławskie should take place no later than the end of August 2025.
According to the new strategy, Develia intends to diversify its core activities in the residential sector by implementing PRS and student housing projects. Therefore, at the beginning of 2024, the company signed a joint venture agreement with the CEE Student Housing Fund, under which a student housing facility with over 300 rooms will be built in Wrocław. Develia will act as the developer responsible for land acquisition, construction supervision, and investment fit-out. After the construction is completed, the partner will buy Develia’s shares in the project and will handle the commercialization and management of the facility. The cooperation model assumes Develia’s capital involvement at the level of 10% and receiving remuneration for the implementation of this project. Develia plans to start the project at the turn of 2024 and 2025 after obtaining a building permit.
Financial Results
| Financial Data (thousand PLN) | 1Q2024 | 1Q2023 | Change |
| Revenue | 401,612 | 257,224 | 56.13% |
| Gross profit from sales | 133,496 | 90,392 | 47.69% |
| Gross profit from sales – development segment | 132,978 | 83,235 | 59.76% |
| Gross profit from sales – commercial segment | -437 | 6,832 | – |
| EBITDA | 109,942 | 70,699 | 55.51% |
| Adjusted EBITDA* | 112,699 | 75,416 | 49.44% |
| Net profit | 84,400 | 58,042 | 45.41% |
| Adjusted net profit* | 87,788 | 61,458 | 42.84% |
| ROE | 5.2% | 3.9% | +1.3pp |
| Adjusted ROE* | 5.4% | 3.9% | +1.5pp |
(*) – adjusted net profit, calculated according to the formula: adjusted net profit = net profit adjusted by the sum of net revaluations of investment properties and inventories – financial income/expenses from the valuation of financial liabilities in EUR – deferred tax created on adjusted items (accordingly ROE and EBITDA)
The group’s revenue for the first quarter of 2024 amounted to PLN 401.6 million, which was 56% higher compared to PLN 257.2 million a year earlier. The group’s net profit amounted to PLN 84.4 million, which was 45% higher than the PLN 58 million in the same period of the previous year.
The gross profit from sales from development activities for the first three months of 2024 amounted to PLN 133 million with revenue of PLN 397.2 million. The gross loss from rental services amounted to PLN 437 thousand with revenue of PLN 2.4 million.
– We have had a very successful start to the year with a record level of sales, which will translate into financial results in the coming periods. Develia’s good liquidity condition ensures our comfort in implementing new residential projects and individual goals from the strategy for 2024-2028, – said Paweł Ruszczak, Vice President of Develia. – In line with the implemented policy, we will share the profit earned last year with shareholders by paying them a total of PLN 226.14 million in dividends, or PLN 0.5 per share, – added Paweł Ruszczak.
In the second quarter of this year, Develia increased the value of the bond issuance program from PLN 650 million to PLN 750 million, and then issued 4-year bonds with a total nominal value of PLN 100 million as part of this program. The interest rate on the bonds was set based on 3M WIBOR plus a margin of 3% per year.
As of the end of March 2024, Develia had a total of PLN 662.2 million in cash, short-term financial assets, and other financial assets compared to PLN 703.4 million at the end of 2023. As of the end of the first quarter of 2024, financial liabilities amounted to PLN 880.7 million compared to PLN 883.9 million at the end of 2023.
