presentation h1 2017 investors

Dom Development S.A. Consolidated Group

/Consolidated accounts/

H1 2017 Results Presentation24 August 2017

Dom Development Euro Styl Dom Development Wrocław

Consolidated Group

Q2 2017

• Acquisition of Euro Styl S.A. funded entirely from own resources, for PLN 260m

• Dom Development’s scale of activity boosted after the acquisition of Euro Styl *

• Record quarterly sales of 850 units (+21% YOY). 1,039 units (+48% YOY) including Euro Styl

• 3,475 units in Dom’s offer as of June 2017 (+15% YOY)

• 5,945 units under construction (+51% YOY)

• Preliminary agreement for a plot on Powązkowska Street, Warsaw - with a potential of

1,350 units (continuation of the Żoliborz Artystyczny project) **

2

* Euro Styl data are presented as on Q2 2017 or on 30 June 2017, if not stated otherwise**Contract concluded in July 2017


Consolidated Group

Financial Results Q2 2017 - summary

• Handovers: 674 units (+20% YOY)

• Revenues: PLN 322.5m (+ 41% YOY )

• Gross Profit Margin: 28% (+ 7 p.p. YOY)

• Net Profit: PLN 49.0m (+ 166% YOY)

• Operating Cash flow: PLN 208.9m (+ 60% YOY)

• Net Cash: PLN 105m; no net debt, even after acquisition of Euro Styl

3


Consolidated Group

Residential Market in Q2 2017

• Strong sales with slight price increases

• Favorable macroeconomic factors supported demand, including low interest rates

and record low unemployment

• Increasing share of cash buyers – approx. 40% of overall transactions at Dom

Development

• Very high competition in the land market

4


Consolidated Group

509 545467

598 640 678615

701 705 714806 850

189

0

200

400

600

800

1,000

Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017

5

No. of units

- Euro Styl

1 039


Consolidated Group

6

* Transaction value includes price of a flat with fit-out (if purchased), storage room (if purchased) and parking space (if purchased)

26% 27% 24% 26% 24% 24% 28%18% 17% 22% 23% 24%

37% 37%35% 32% 33% 29% 23%

22% 23%25%

33% 29%

18% 18%22% 21% 24%

23% 21%

25% 26%21%

22%20%

19% 18% 20% 21% 19% 24% 28%35% 34% 31%

22% 27%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017

up to PLN 350k PLN 350-450k PLN 450-550k over PLN 550k


Consolidated Group

2,397

1,696 1,548

2,5052,214 2,104

2,278

2,797

457

357

557547

506

451402

272

204

17

0

500

1,000

1,500

2,000

2,500

3,000

3,500

30/09/2015 31/12/2015 31/03/2016 30/06/2016 30/09/2016 31/12/2016 31/03/2017 30/06/2017

2 754 2 253 2 095 3 011 2 665 2 506 2 550 3 475

7

No. of units

- Units under construction - Finished units - Euro Styl


Consolidated Group

8

735279 426

1 349

557 555 517

1 443

211

0

200

400

600

800

1 000

1 200

1 400

1 600

Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017

No. of units

7 projects4 projects4 projects3 projects 8 projects 3 projects4 projects 2 projects

- Euro Styl

5 projects

1 65412 projects


Consolidated Group

3,989

2,958 3,085

3,935 3,8863,543

3,854

4,848

1,097

0

1,000

2,000

3,000

4,000

5,000

6,000

30/09/2015 31/12/2015 31/03/2016 30/06/2016 30/09/2016 31/12/2016 31/03/2017 30/06/2017

- Euro Styl

9

No. of units 5 945


Consolidated Group

5,001

6,504 6,648 6,734 7,0166,450 6,688 7,010

1,296

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

30/09/2015 31/12/2015 31/03/2016 30/06/2016 30/09/2016 31/12/2016 31/03/2017 30/06/2017

- Euro Styl

10

No. of units8 306


Consolidated Group

11

Units sold but not delivered (presales)

31.03.2017 30.06.2017

2 256 units

3 056units, including:

• 246 finished units• 2 810 units under construction

478

1 019

256

564 500

1 162

230

635

39

0

200

400

600

800

1000

1200

Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017

No. of units

674

*

* Euro Styl handovers for the period of 8 June – 30 June, i.e. after aquisition

- Euro Styl


Consolidated Group

12

PLN m

200

400

600

800

1,000

1,200

1,400

J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J

2013 2014 2015 2016 2017

- including Euro Styl


Consolidated Group

Simplified profit and loss account

Profit and Loss Account Q2 2017 Q2 2016 Change H1 2017 H1 2016 Change

Sales Revenues 322.5 228.7 +41% 435.5 367.7 +18%

Handovers (units) 674 564 +20% 904 820 +10%

Revenue per unit 478 405 +18% 482 448 +7%

Gross Profit on Sales 90.3 48.1 +88% 116.4 79.9 +46%

Gross Profit Margin 28.0% 21.1% +7.0 p.p. 26.7% 21.7% +5.0 p.p.

Operating Profit 58.3 23.2 +151% 57.3 30.6 +87%

Operating Profit Margin 18.1% 10.2% +7.9 p.p. 13.2% 8.3% +4.8 p.p.

Profit Before Tax 59.0 23.2 +155% 58.0 29.6 +96%

Profit Before Tax (%) 18.3% 10.1% +8.2 p.p. 13.3% 8.0% +5.3 p.p.

Net Profit 49.0 18.4 +166% 48.0 23.5 +104%

Net Profit (%) 15.2% 8.1% +7.1 p.p. 11.0% 6.4% +4.6 p.p.

EPS (PLN) 1.9 0.7 +161% 1.93 0.95 +103%

13

IAS 18. PLN m


Consolidated Group

Simplified balance sheet

14

Consolidated Balance Sheet 30.06.2017 30.06.2016 Change

Shareholders’ funds (equity) 855.1 826.6 3%

Net debt/(net cash)* -105.3 -2.9 N/A

Gearing (net debt/equity) N/A N/A N/A

Net asset value per share (PLN) 34.39 33.35 3%

Shares in issue (m) 24.9 24.8 -

ROE (12M) 18.2% 12.3% 5.9 p.p.

ROCE (12M) 18.0% 12.2% 5.8 p.p.

*Bank debt plus bonds in issue less cash at banks (including escrow accounts)

IAS 18, PLN m


Consolidated Group

Simplified cash flow

15

IAS 18, PLN m

Cash flow 30.06.2017 30.06.2016

Profit/(loss) before tax 58.0 29.6

Changes in inventory (66.9) (142.8)

Changes in prepayments and deferred income 254.2 228.0

Other adjustments (2.5) 27.2

Cash flow generated from operating activities 242.8 141.9

Interest paid and received (6.2) (5.7)

Income tax paid (27.7) (6.0)

Cash flow from operating activities after interest and tax 208.9 130.2

Cash flow from investing activities (200.6) (3.4)

Net cash flow from financing activities (122.1) (19.5)

Increase / (decrease) in net cash and cash equivalents (113.8) 107.3

Cash and cash equivalents – opening balance 414.3 221.6

Cash and cash equivalents – closing balance 300.5 328.9


Consolidated Group

16

50

0

100

0

110

0

20

40

60

80

100

120

by 30.06.2018 by 30.06.2019 by 30.06.2020 by 30.06.2021 by 30.06.2022

unsecured bonds Bank loans

PLN m

Cash (including escrow accounts) as of 30/06/2017 PLN 365m Bond debt at 30/06/2017 PLN 260mAvailable credit lines as of 30/06/2017 PLN 235m


Consolidated Group

Q2 2017

17

Summary:

Euro Styl acquisition has stepped up the scale of Dom Development S.A.

Very good situation in Warsaw, Wroclaw and Tri-City (Euro Styl) markets

5,945 units under construction on 37 projects

Launch of 12 projects with 1,654 units

3,475 units in offer

1,039 units sold (increase +48% YOY)

New land for over 1,600 units in Warsaw and 150 units in Tri-City*

Increase in net profit of more than 160% (YOY)

PLN 105m in net cash

* Purchase of land as of 23/08/2017


Consolidated Group

18


Consolidated Group

19

Appendix 1:

Commencement of handovers in 2017

Commencement of handovers: on schedule/earlier/delayed* Tri-City

Project No. of units in project Commencement of handovers

Q3

Brama Żuław building A* 49 July 2017

Palladium phase 1 214 August 2017

Osiedle Cytrusowe buildings A12, A13* 46 August 2017

Osiedle Viridis building A3* 58 September 2017

Idea building B3* 58 October 2017

Osiedle Cytrusowe buildings B16, B17* 46 October 2017

Q4

Premium phase 2 236 October 2017

Ursynovia phase 1 79 October 2017

Ursynovia phase 2 111 October 2017

Moderna phase 2 194 November 2017

Osiedle Pod Różami phase 3 50 November 2017

Saska III 359 November 2017

Żoliborz Artystyczny phase 5 126 November 2017

Żoliborz Artystyczny phase 6 137 November 2017

Żoliborz Artystyczny phase p 7 140 November 2017

Wille Taneczna 119 December 2017

Wilno III phase 2 129 December 2017

Wilno III phase 3 111 December 2017


Consolidated Group

20

No PROJECTUNDER CONSTRUCTION

INPREPARATI

ON

1 ŻOLIBORZ ARTYSTYCZNY 403 ---

2 ŻOLIBORZ ARTYSTYCZNY II (NEW) 1 350

3 PREMIUM 731 -

4 WILLE LAZUROWA 102

5WŁODARZEWSKA 30(NOWOSOLIPSOWSKA)

123 ---

6 OS. POD RÓŻAMI III 50 ---

7 PRZY PARKU --- 46

8 MARINA MOKOTÓW --- 756

9 BUKOWIŃSKA III --- 190

10 CYBERNETYKI 393 240

11 TANECZNA (NEW) 119 116

12 URSYNOVIA (ANODY) 190 ---

13 SOBIESKIEGO --- 157

14 BARTYCKA (NEW) --- 132

TOTAL LEFT BANK 2 111 2 987

No PROJECTUNDER

CONSTRUCTIONIN

PREPARATION

15 REGATY --- 217

16 PALLADIUM (AKACJE) 215 566

17 KLASYKÓW 204 ---

18 KOWALCZYKA --- 844

19 MODERNA 570

20AMSTERDAM(SAMARYTANKA)

374 202

21 WILNO 549 1 316

22 FORMA (MOTOROWA) 294 213

23 SASKA III 359 ---

24 SIENNICKA 533

TOTAL RIGHT BANK 2 565 3 891

Warsaw

13

56

12

9

16 17

23

15

1819

21

22

PROJECT IN PREPARATION

PROJECT UNDER CONSTRUCTION

87

13

11

4

10

20

Appendix 2a:

Projects Under Construction and in PreparationWarsaw no. of units, as of 30/06/2017

24

14

2


Consolidated Group

Appendix 2b:

Projects Under Construction and in PreparationTri-City no. of units, as of 30/06/2017

21



Tri-City

No PROJECTUNDER

CONSTRUCTIONIN PREPARATION

1 OSIEDLE VIRIDIS 132 ---

2 IDEA 141 312

3 NOWY HORYZONT 76 ---

4 SPEKTRUM 338 231

5 IMPULS 2 208 ---

6 OSIEDLE CYTRUSOWE 92 ---

7 OSIEDLE BEAUFORTA --- 603

8 SCENA APARTAMENTY 61 ---

9 BRAMA ŻUŁAW 49 ---

10 KRYNICKA (NEW) --- 150

TOTAL 1 097 1 296

1

24

58

7

10

36

9


Consolidated Group

22

Appendix 2c:

Projects Under Construction and in PreparationWroclaw no. of units, as of 30/06/2017

PROJEKTUNDER

CONSTRUCTION

IN PREPARATION

RYBNICKA --- 132

AURA 172

TOTAL 172 132

Wroclaw




Consolidated Group

Appendix 2d:

Projects Under Construction and in PreparationSummary

23

CITYNo OF PROJECTS UNDER

CONSTRUCTIONUNDER CONSTRUCTION IN PREPARATION TOTAL (No OF UNITS)

WARSAW 28 4 676 6 878 11 554

WROCLAW 1 172 132 304

TRI-CITY 8 1 097 1 296 2 393

TOTAL 37 5 945 8 306 14 251


Consolidated Group

24

For further information, please contact:

Matylda SieradzkaInvestor Relations

tel. +48 22 351 68 49

e-mail: [email protected]

Dom Development S.A. endeavours to ensure that the information in the presentation is complete. up-to-date and accurate. However. we do not make any guarantees in this respect. Dom Development S.A. connot accept responsibilty for the consequences of using suchinformation. and in particular any loss caused by reliance thereon for the purpose of investment decisions. The material contained in the presentation originates from reliable public sources and to the best knowledge of Dom Development S.A. may be considered reliable.