prezentacja j.w.construction holding s.a. performance in q1 2009 prezentacja j.w.construction...

PREZENTACJA J.W.CONSTRUCTION HOLDING S.A.

PERFORMANCE IN Q1 2009

PREZENTACJA J.W.CONSTRUCTION HOLDING S.A.

PERFORMANCE IN Q1 2009

2

CHANGE IN ACCOUNTING POLICY 3

CHANGES IN ACCOUNTING POLICY – OUTCOMES 4

PERFORMANCE IN Q1 2009 5

Q1 2008 GROSS SALES PROFIT 7

STRATEGY OF J.W. CONSTRUCTION HOLDING S.A. 8

STRATEGY - DIVERSIFYING OPERATIONAL RISK OF THE GROUP 9

STRATEGY- APARTMENTS READY TO MOVE IN 16

STRATEGY- PROJECTS IN THE PIPELINE 17

IMPLEMENTED PROJECTS – OVERVIEW 18

INDUSTRY DEVELOPMENT PROSPECTS IN THE COMPANY’S VIEW 24

THE COMPANY’S SALES POLICY IN 2008 25

PRESENTATION PERFORMANCE IN Q1 2009

PRESENTATION AGENDA

CHANGE IN ACCOUNTING POLICYCHANGE IN ACCOUNTING POLICY

3

By the end of 2008, the Group recognized revenues and expenses using the

“zero-profit-margin method” (IAS 11), after:

- actual revenues exceeded 50% for a given project, and

- actual expenses of the project exceed 40%.

In accordance with the new regulations, in force from 2009, the Group applies

IAS 18 to recognize revenues and expenses:

- revenues are included in the profit and loss account after an apartment is

transferred to its buyer under a notarial deed, with alternate options that include

revenue recognition after a building permit is received, the purchased apartment

is paid for in full and the apartment is officially accepted by the buyer.


CHANGES IN ACCOUNTING POLICY – OUTCOMES

4

Changes in accounting policy – outcomes:

For particular projects, revenue and expense recognition (and thus gross profit

recognition) will be shifted in time

Operating result – depends on the phase of the project – will be recognized

after a given project is completed, i.e. after 18 – 24 months


126,2

240,5

0,0

50,0

100,0

150,0

200,0

250,0

Q1 2008 Q1 2009

Sales revenue, PLN million:

23,1

25,9

21,522,022,5

23,023,5

24,024,5

25,025,5

26,0

Q1 2008 Q1 2009

Gross margin, %

5

2008 data – restated to IAS 18

In Q1 2009, sales increased by 90.6% from the same period last year


PERFORMANCE IN QPERFORMANCE IN Q11 200 20099

18,1

50,5

0,0

10,0

20,0

30,0

40,0

50,0

60,0

Q1 2008 Q1 2009

Operating profit, PLN million:

11,7

35,5

0,0

5,0

10,0

15,0

20,0

25,0

30,0

35,0

40,0

Q1 2008 Q1 2009

Net profit, PLN million:

6

Operating profit rose by 179% in Q1 2009 year on year

In addition, net profit in Q1 2009 posted a 204% increase as compared with Q1 2008


PERFORMANCE IN QPERFORMANCE IN Q11 200 20099

2008 data – restated to IAS 18

Q1 2008 GROSS SALES PROFIT

The total gross sales profit in the first quarter came to PLN 62,5 million. The

following projects contributed the main to this figure:

Osiedle Górczewska I, Warsaw - 31 %

Osiedle Lazurowa, Warsaw - 18 %

Rezydencja na Skarpie, Warsaw - 14 %

Osiedle Leśne, Gdynia - 12 %

Willa Konstancin, Konstancin - 9 %

Osada Wiślana, Warsaw - 7%

Osiedle Centrum, Łódź - 5%

7 PRESENTATION PERFORMANCE IN Q1 2009


STRATEGY OF STRATEGY OF J.W. CONSTRUCTION HOLDING S.A.J.W. CONSTRUCTION HOLDING S.A.

Regardless of circumstances, the Company diversifies the Group’s risks by:

Expanding non-developer operations of affiliated companies – general construction, designing, construction prefab manufacturing

Enhancing the product range by office and commercial space

Continuing started housing projects – none of the projects in progress has been stopped

Providing a differentiated commercial offer – including apartments ready to take

Continuing preparations of new projects (documentation and building permit phase)


STRATEGY - STRATEGY - DIVERSIFYING OPERATIONAL RISK OF THE GROUPDIVERSIFYING OPERATIONAL RISK OF THE GROUP

J.W. Construction S.A. – focus: construction and assembly work

Strengths:

It may implement projects for unaffiliated clients (general construction, electrical engineering, water & sewage, and road construction work)

Experienced engineering and technical staff, own resources for project implementation

Substantial construction and transportation equipment resources

Development of Affiliated Companies – Strength and Capabilities


JW Projekt Sp. z o.o. – focus: architecture and design.

It may prepare projects for unaffiliated clients (recently it has been invited by National Airports to take part in the contest for a luxury hotel in the vicinity of the Okęcie Airport)

Skilled and experienced experts in various designing units dedicated to: architecture, design engineering, water & sewage and electrical systems




JWCH Produkcja Budowlana Sp. z o.o. – focus: construction prefab

manufacturing – own plant with an advanced production line

Shorter deadlines

Prefabs may be offered to unaffiliated clients

Target – reduced expenditures



The Company is prepared to start a commercialization project for office buildings,

hence project implementation may commence soon.

Office and Commercial Space

Office Building – Jerozolimskie PointWarszawa, Badylarska / Al. Jerozolimskie Streets

It is a modern 5-storey B+ class office

building (with option to upgrade to A class

standard), designed to the highest

standards and care for work comfort.

Useable space: 4,157 sq. m.

12



Office Building - Nowa DanaSzczecin, Wyzwolenia Avenue / Odzieżowa Street

It is a technologically advanced 22-storey A class office

building.

- Useable space: 25,324 sq. m.

- Office space: 20,877 sq. m.

- Commercial space: 4,447 sq. m.

A hotel with catering establishments and shops

Warszawa, PileckiegoStreet

Construction design in progress. Planned

space: 16,838 sq. m.

13


Office and Commercial Space


At present, J.W. Construction Holding Group has

5 two- and three-star hotels in: Zegrze, Stryków,

Cieszyn, Tarnów Podgórny and Święta Lipka.

Hotels focus on institutional clients (conferences,

training sessions, seminars), but do not ignore

individuals.

Hotel Operations

14



In 2005, the Company purchased the “Czarny

Potok” Resort in Krynica. Now, it is being

expanded and upgraded to the “Resort & SPA”

standard. The goal is to convert it into a four-star

hotel with appropriate catering and conference

facilities plus a five-star SPA/wellness centre. The

building houses a lobby with reception desk, a

restaurant for 400 guests and a multi-purpose

conference room.

15


Hotel Operations


STRATEGY- STRATEGY- APARTMENTS READY TO MOVE INAPARTMENTS READY TO MOVE IN

Osiedle Leśne in Gdynia Osiedle Centrum in Łódź

Willa Konstancin in Konstancin Jeziorna

Osiedle Uroczysko in Katowice

The Company has

about 100 available

apartments, ready to

move in, in already

completed projects



STRATEGY- STRATEGY- PROJECTS IN THE PIPELINEPROJECTS IN THE PIPELINE

Regardless of market circumstances, works related to preparation of further projects are carried out based on the existing “land bank”, including:

Drawing up documents, e.g. design documentation

Applying for building permits.

The above actions will allow smooth construction commencement in the future.

PROJECT CITY / DISTRICTMARKET SEGMENT NO. OF

APARTMENTS / HOUSES

ESTIMATED USABLE APARTMENT FLOOR

SPACE, SQ. M

Zielona Dolina I, Zdziarska/Ostródzka

StreetsWarsaw / Białołęka Standard apartments 633 * 29 200

Lewandów Park III, Lewandów Street Warsaw / Białołęka Standard apartments 787 33 179

Zielona Dolina II, Zdziarska/Ostródzka

StreetsWarsaw / Białołęka Standard apartments 872 43 350

Światowida Warsaw / Białołęka Standard apartments 196 10 140

Szczecin, Wyzwolenia Avenue Szczecin Luxury apartments/ services - 25 324

Badylarska – Office Building Warsaw Services - 4 157

Pileckiego – Offices / Hotel Warsaw Services/ Hotel services - 16 838

Berensona Warsaw / Białołęka Standard apartments 170 9 350

* Apartments available for sale – construction work to start in the middle of 2009

Górczewska Park II

Warsaw, Górczewska/ Olbrachta Streets

The Górczewska Park project includes 12 apartment buildings situated at Górczewska/Olbrachta Streets - 886 apartments and 4 commercial premises.

ProjectUsable apartment floor

space (sq. m)Revenue (PLN

thousand)

Górczewska Park 44 929 437 173

18

Warsaw Market

IMPLEMENTED PROJECTS - OVERVIEWIMPLEMENTED PROJECTS - OVERVIEW


Lewandów Park

Warsaw, Lewandów Street

A gated housing compound consisting of over 1,900 apartments. Construction in two stages - Lewandów Park I and Lewandów Park II. Attractive location, good connection to the city center.


space (sq. m)Revenue (PLN thousand)

Lewandów Park 81 191 443 169

19

Warsaw Market



Osiedle Bursztynowe

Warsaw, Korkowa Street

A small, cozy housing estate consisting of four-story houses. Very good connection to the city center. Gated and guarded estate. 322 apartments are planned.


space (sq. m)Revenue (PLN

thousand)

Osiedle Bursztynowe 17 402 120 316

20

Warsaw Market



Wiślana Aleja

Warsaw, Odkryta Street

A housing estate consisting of modern six-story houses. The estate includes 200 apartments with underground garages. Fast and easy access to schools, kindergartens and shopping malls.



Wiślana Aleja 9 770 71 925

21

Warsaw Market



Ludwinowska Aleja II

Warsaw, Ludwinowska Street

Six cosy semi-detached houses with 24 apartments.



Ludwinowska Aleja II 1 649 13 391

22

Warsaw Market



Osada Wiślana

Warsaw, Marcina z Wrocimowic Street

A complex of 3-storey buildings with 400 apartments. The privacy of inhabitants is heightened by enchanting location, near the Vistula River and forest.



Osada Wiślana 20 445 127 513

23

Warsaw Market




INDUSTRY DEVELOPMENT PROSPECTSIN THE COMPANY’S VIEW

Regardless of the stagnation in the housing market, which has been felt for several months now, supply is still outstripped by demand — the shortfall amounts to over 1.5 million apartments (Central Statistical Office figures as of December 2007)

There is an active group of customers in the real estate market who were born during the 1980s baby boom and whose housing needs still have not been met

Forecasts indicate a decline in PLN interest rates

Supply of new apartments will be probably decreasing, starting in 2010, as developers have stopped many projects and postponed start-ups, which is likely to increase both demand and prices

Stable pricing situation in the construction materials market

In the longer term, demand will be boosted again from 2010 onwards due to the Euro 2012 effect and Poland’s probable entry into the euro area


THE COMPANY’S SALES POLICY IN 2008

Offer of financing programmes for Customers

Packages offering special conditions, dedicated to employees of institutions co-operating with J.W. Construction

Excellent housing offer, including instant-delivery opportunity buys

Interior finishing programmes for Customers

Implementation of alternative sales channels

Continuous marketing activities

Flexible approaches to clients – negotiable prices depending on payment amounts and schedules

INVESTOR RELATIONS OFFICE:Małgorzata Szwarc-Sroka

Head of Financial Liquidity Managementand Head of the Investor Relations Office

Phone: +48 022 771 77 85 / +48 0 22 771 78 10or +48 022 771 75 10

e-mail: [email protected]

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