Cairn Homes Plc (CRN) Cairn Homes Plc: Trading Update for the
Year Ended 31 December 2022 09-Jan-2023 / 07:00 GMT/BST
Dissemination of a Regulatory Announcement, transmitted by EQS
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Trading Update for the Year Ended 31 December 2022
Cairn Grows Revenues by 46% and Completes Over 1,500 Closed
Sales in 2022
Dublin / London, 9 January 2023: Cairn Homes plc ("Cairn", "the
Company" or "the Group") today issues a trading update for the year
ended 31 December 2022 in advance of full year results to be
announced on 2 March 2023.
FY 2022 Trading Update
The Company delivered a very strong performance in 2022 in
respect of new homes sold and revenue generation, both ahead of
market guidance:
-- Closed 1,526 new home sales (2021: 1,120) and generated core
housebuilding revenue of c. EUR610 million(2021: EUR419
million).
-- With this level of performance, the Company is comfortable
with existing FY 2022 profitability guidanceof 21.5% gross margin,
EUR100 million operating profit and a 16.5% operating margin.
-- The Company will deliver minimum shareholder returns for FY
2022 of EUR115 million from both ordinarydividends and share
buybacks.
-- Cairn's performance was supported by strong levels of demand
from first time buyers, many of whom are nowable to avail of
impactful Government supports including the recently launched First
Home shared equity scheme.Considering the level of embedded build
cost inflation throughout the last two years coupled with
significantinterest rate increases, many of these customers would
not otherwise be able to access new homes.
-- Over the last two years, Cairn has become a more established
delivery partner for various State entities,including Approved
Housing Bodies, Local Authorities and the Land Development Agency.
In 2022, Cairn was one of thelargest providers of new Social &
Affordable housing in Ireland, having delivered almost 500 new
A-rated homes.This included a substantial number of apartments in
our larger developments. In 2023, we will continue to use ourscale
and capacity to create value for the State and we will increase our
delivery to over 800 new Social &Affordable homes
nationwide.
-- Build cost inflation was significant in the year with the
cost of building our homes increasing by c.EUR20,000 per new home.
Inflation persisted into H2, albeit at more moderate levels. The
cost of building new homesin Ireland therefore remains
significantly elevated compared to two years ago with our build
costs having increasedby c. EUR35,000 per new home in this
period.
-- The Company invested heavily in sustained growth with eight
new site commencements in the year, includingnew regional sites in
Cork, Limerick and Kilkenny. The Company was active on over 20
sites nationwide during 2022.
-- Cairn reached a number of critical milestones at Dublin's
newest suburb in Clonburris where we willdeliver c. 5,500 new homes
in the years ahead. Clonburris received final formal approval of
the Government's EUR186million Urban Renewal Development Fund
grant, whilst we also secured planning permission for Phase 1 (569
newhomes) and commenced significant infrastructure works in advance
of a formal site commencement in early 2023.
-- The new masterplan for our Montrose site, including 688
apartments and a 192 bedroom hotel, has beengranted approval by the
local authority.
-- With the challenges that the increased cost of living is
having on our employees, we continued to investin our employee
value proposition. We increased our remuneration benefits across a
range of well-being measuresincluding providing increased family
health benefits and innovative mental health and diversity support
initiativesacross our workforce.
-- Significant progress has been made on our sustainability
agenda with the publication of our inauguralsustainability report
and achievement of an upgraded A- CDP score. Having set our scope 1
and 2 carbon reductiontargets, we have submitted our scope 3 carbon
reduction target to SBTi and will announce these in March 2023.
Outlook
Cairn has a proven track record as a high quality housebuilder.
Allied with our design and construction capability on
higher-density apartment schemes, this gives us a unique
competitive advantage and supports growth across our multiple and
expanding market segments.
The Company has a large and principally planning consented
residential landbank, including full planning permission on all of
our forecasted units for this year. We will be active on 20
developments nationwide during 2023, underpinning our continued and
ambitious volume growth trajectory.
Cairn enters 2023 with our largest ever forward sales pipeline
of over 1,100 new homes and we are confident of making further
financial progress in the year ahead.
The Irish economy is expected to grow again in 2023 with the
Government forecasting a second year of an exchequer surplus.
Inflation and interest rates remain a concern, however, population
growth, family formation numbers, strong employment, a healthier
banking environment and more Government initiatives than ever to
support home buyers are all positive tailwinds.
The Company will provide guidance and an update on capital
allocation for FY 2023, together with details of our FY 2022 final
dividend, when we release our full year results on 2 March
2023.
Commenting on the full year 2022 trading update, Michael
Stanley, Chief Executive Officer, said:
"Cairn is proud to have become the first company in Ireland to
deliver over 1,500 new homes in a calendar year. This included a
broad mix of first time buyer houses and duplexes, houses and
apartments for second time buyers, and apartments for the private
and affordable rental markets.
Our completions last year also included 495 new Social &
Affordable homes delivered across our larger developments
nationwide. We expect to significantly grow this output in 2023 and
continue to provide value and timely delivery for our partners in
Local Authorities, Approved Housing Bodies and the Land Development
Agency.
We witnessed exceptional levels of demand from first time
buyers, many of whom are now able to avail of impactful Government
supports including the recently launched First Home shared equity
scheme. Considering the level of embedded build cost inflation
throughout the last two years coupled with significant interest
rate increases, many of these customers would not otherwise be able
to purchase their new family homes.
Looking at the wider market, Ireland has increased its working
population by 500,000 to over 2.5 million people in the last six
years. Supply of new residential accommodation in response to this
successful economic period has seen a significant increase in the
number of lower density houses completed in suburban and regional
areas. This well supported bias or misjudged focus means that new
apartment developments close to any areas of high employment or
multimodal transport links remain virtually non-existent.
Today, there are over 80,000 planned apartments in the pipeline,
all of which meet new design and size standards. While many have
been held up by our planning system or objections, nearly one third
have full planning permission and should be under construction.
Viability and funding remain challenging, however, our industry has
the capacity to deliver, and working collaboratively with
Government support, can address this damaging supply imbalance.
Ireland's sustainable social, environmental and economic future
depends on it."
For further information, contact:
Cairn Homes plc +353 1 696 4600
Michael Stanley, Chief Executive Officer
Shane Doherty, Chief Financial Officer
Ian Cahill, Head of Finance
Declan Murray, Head of Investor Relations
Drury Communications +353 1 260 5000
Billy Murphy
Claire Rowley
Morwenna Rice
Notes to Editors
Cairn Homes plc ("Cairn") is the leading Irish homebuilder
committed to building high-quality, competitively-priced,
sustainable new homes in great locations. At Cairn, the homeowner
is at the very centre of the design process and we strive to
provide an unparalleled customer service throughout each stage of
the home-buying journey. A new Cairn home is thoughtfully designed
and built to last with a focus on creating shared spaces and
environments where communities prosper. Cairn owns a c. 16,700 unit
landbank, over 90% of which are located in the Greater Dublin Area
("GDA") with excellent public transport and infrastructure
links.
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ISIN: IE00BWY4ZF18
Category Code: TST
TIDM: CRN
LEI Code: 635400DPX6WP2KKDOA83
OAM Categories: 3.1. Additional regulated information required to be disclosed under the laws of a Member State
Sequence No.: 214077
EQS News ID: 1529815
End of Announcement EQS News Service
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