Quarterly Report • May 20, 2020
Quarterly Report
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(Figures in brackets relate to the same period of the year before)
| (figures in NOK 1 000) | Q1 2020 | Q1 2019 | 2019 |
|---|---|---|---|
| IFRS main figures | |||
| Operating revenues | 209 110 | 109 159 | 3 368 838 |
| EBITDA* | 110 250 | -11 505 | 877 455 |
| EBITDA adjusted** | 117 325 | -8 951 | 959 361 |
| Operating profit/(loss) | 1 136 446 | (14 802) | 864 707 |
| Profit/(loss) before taxes | 1 136 509 | (20 590) | 853 969 |
| Cash flow from operating activities | 1 182 619 | (358 101) | 985 901 |
| Net cash flow | (407 339) | (91 994) | 521 652 |
| Interest-bearing liabilities | 2 517 304 | 2 560 889 | 2 253 331 |
| Total assets | 6 102 529 | 6 583 479 | 6 912 432 |
| Equity | 2 467 245 | 3 099 393 | 3 382 084 |
| Equity ratio | 40.4% | 47.1% | 48.9% |
| Earnings per share in NOK | 12.08 | (0.16) | 7.04 |
| Segment reporting (NGAAP****) | |||
| Operating revenues | 756 297 | 680 484 | 3 259 957 |
| EBITDA*** | 159 547 | 154 316 | 770 631 |
| EBITDA margin | 21.1% | 22.7% | 23.6% |
| Key figures (net, adjusted for share in joint ventures) | |||
| Number of units sold | 164 | 243 | 752 |
| Number of construction starts | 15 | 97 | 830 |
| Number of units delivered | 114 | 29 | 732 |
| Number of units completed | 89 | 12 | 776 |
* EBITDA is operating profit before interest, taxes, depreciation, amortisation and other gains (losses).
** EBITDA adjusted excludes financial expenses included in project cost. See note 6 for details.
*** EBITDA is operating profit before interest, tax, depreciation, amortisation, profit from joint ventures and other gains (losses).
**** The NGAAP accounts utilise the percentage of completion method, i.e percentage of completion multiplied by the sales ratio.
Selvaag Bolig has initiated measures related to the Covid-19 pandemic, which are intended to protect customers, employees, suppliers and others. At 19 May, no group employees had tested positive for the virus and all personnel are recommended to follow the recommendations and advice of the relevant authorities.
Among other measures designed to maintain sales activity, Selvaag Bolig has made provision for digital viewing of properties as well as increased use of private viewing. It also initiated a sales campaign aimed at customers aged 18-34. This has yielded good results, and is being continued until 30 June in the first instance.
Uncertainty remains high and the position could change if the Covid-19 outbreak proves lengthy. It is unclear what longterm spin-offs the pandemic might have, and how these may in turn affect the housing market and Selvaag Bolig. At 19 May, progress with current projects had not been noticeably affected.
As a pure housing developer, Selvaag Bolig puts all construction out to competitive tender. That provides a high level of operational flexibility, allowing the group to adjust operations at short notice to changes in market activity. As a general rule, the group also requires 60 per cent advance sales in a project before starting construction. Seventy-six per cent of total units under construction and 82 per cent of those planned for completion in 2020 were sold at 31 March. In addition to action already taken, the possible need for further measures will be continuously assessed.
Given the outlook for market developments, securing good liquidity is a priority. The group has a solid financial position.
Selvaag Bolig is well equipped organisationally, operationally and financially to maintain and strengthen its position, including during the uncertain times currently being experienced by Norway.
| (figures in NOK 1 000) | Q1 2020 | Q1 2019 | 2019 |
|---|---|---|---|
| Total operating revenues | 209 110 | 109 159 | 3 368 838 |
| Project expenses | (133 891) | (69 510) | (2 279 485) |
| Other operating expenses, salaries and personnel costs, | |||
| depreciation and amortisation | (54 126) | (60 033) | (286 870) |
| Total operating expenses | (188 017) | (129 543) | (2 566 355) |
| Associated companies and joint ventures | 86 662 | 5 582 | 62 224 |
| Other gains (losses), net | 1 028 691 | - | - |
| Operating profit | 1 136 446 | (14 802) | 864 707 |
| Net financial expenses | 63 | (5 788) | (10 738) |
| Profit before taxes | 1 136 509 | (20 590) | 853 969 |
| Income taxes | (7 514) | 5 348 | (199 454) |
| Net income | 1 128 995 | (15 242) | 654 515 |
(Figures in brackets relate to the corresponding period of 2019. The figures are unaudited.)
Selvaag Bolig had operating revenues of NOK 209.1 million (NOK 109.2 million) in the first quarter. Revenues from units delivered accounted for NOK 195.9 million (NOK 92.8 million) of this total. Other revenues derived from non-core activities, mainly provision of services.
A total of 114 units (29) were delivered in the quarter, including 40 (17) from consolidated project companies and 74 (12) from joint ventures.
Project costs for the quarter totalled NOK 133.9 million (NOK 69.5 million), of which NOK 7.1 million (NOK 2.6 million) represented previously capitalised financial expenses. Total project expenses primarily represented construction costs for units delivered as well as costs in projects which did not qualify for capitalisation as inventory.
Operating costs excluding project costs totalled NOK 54.1 million (NOK 60 million) for the period. Payroll costs accounted for NOK 30.4 million (NOK 27.2 million) of this figure. In addition, NOK 6 million (NOK 5.5 million) in payroll costs relating to housing under construction was capitalised during the quarter and will be expensed as project costs on future delivery.
Other operating costs came to NOK 21.3 million (NOK 29.6 million) for the quarter, including NOK 6.4 million (NOK 12.5 million) for sales and marketing.
The share of profit from associates came to NOK 86.7 million (NOK 5.6 million) for the quarter. This increase from the same period of 2019 primarily reflected more deliveries by joint ventures.
Other gains amounted to NOK 1 028.7 million. These related to the sale of a substantial proportion of the group's land
Consolidated net cash flow from operational activities was NOK 1 182.6 million (negative at NOK 358.1 million) for the first quarter. The rise from the same period of 2019 primarily reflected the settlement for the transaction with Urban Property. See the table in note 7 for more information. The negative effect from inventory reflected a high level of construction activity and relatively few deliveries from wholly owned projects during the quarter. See note 5 on inventories for more information.
Net cash flow from investing activities was NOK 220.2 million (NOK 39.7 million) for the quarter. The change from the same portfolio to Urban Property, and present the net accounting effects of this transaction. See note 7 for more information.
Reported EBITDA, less the gain from the transaction with Urban Property, was NOK 110.3 million (negative at NOK 11.5 million), corresponding to a margin of 52.7 per cent (negative at 10.5 per cent). EBITDA adjusted for financial expenses included in project costs came to NOK 117.3 million (negative at NOK 9 million), corresponding to a margin of 56.1 per cent (negative at 8.2 per cent). The big rise in EBITDA for the first quarter reflected a high proportion of deliveries in joint ventures, since results from these are presented net and not included in turnover. For more information, see note 8 on proportional consolidation.
Consolidated depreciation and amortisation totalled NOK 2.5 million (NOK 3.3 million) for the quarter. Operating profit thereby came to NOK 1 136.4 million (loss of NOK 14.8 million).
Net financial income amounted to NOK 0.1 million (expense of NOK 5.8 million). Pre-tax profit for the quarter came to NOK 1 136.5 million (loss of NOK 20.6 million).
Tax expense for the period came to NOK 7.5 million (income of NOK 5.3 million). This low figure must be viewed in relation to conducting the transaction with Urban Property as a sale of shares, allowing the gain to be treated in accordance with the exemption method for share sales between limited companies. Comprehensive income for the first quarter consequently came to NOK 1 129 million (loss of NOK 15.2 million). NOK 1 129 million of the profit was attributable to the shareholders of Selvaag Bolig ASA (loss of NOK 15.2 million), and NOK 0 (NOK 0) to non-controlling shareholders.
period of last year primarily reflects the settlement for the transaction with Urban Property, covering equity interests in joint ventures and loans related to these. See note 7. Disbursements in the quarter related to financing of joint ventures.
Net cash flow from financing activities was negative at NOK 1 810.1 million (positive at NOK 226.4 million) for the quarter. The change from the same period of 2019 primarily reflected the supplementary dividend of NOK 2 055.3 million paid following the transaction with Urban Property. Refinancing of land loans in connection with the transaction is described in note 7. Other changes in liabilities relate primarily to the drawdown of construction loans.
The group's holding of cash and cash equivalents at 31 March totalled NOK 771.3 million (NOK 565 million), a decline of NOK 407.3 million from 31 December and an increase of NOK 206.3 million from a year earlier.
| (figures in NOK 1 000) | Q1 2020 | Q1 2019 | 2019 |
|---|---|---|---|
| Profit before taxes | 1 136 509 | (20 590) | 853 969 |
| Net cash flow from operating activities | 1 182 619 | (358 101) | 985 901 |
| Net cash flow from investment activities | 220 152 | 39 700 | 64 128 |
| Net cash flow from financing activities | (1 810 110) | 226 406 | (528 377) |
| Net change in cash and cash equivalents | (407 339) | (91 994) | 521 652 |
| Cash and cash equivalents at start of period | 1 178 686 | 657 034 | 657 034 |
| Cash and cash equivalents at end of period | 771 347 | 565 040 | 1 178 686 |
The carrying amount of Selvaag Bolig's total inventory (land, units under construction and completed units) at 31 March was NOK 4 053.9 million, compared with NOK 3 636.7 million at 31 December and NOK 4 614.9 million a year earlier. The increase during the first quarter primarily reflected a rise in the inventory of units under construction because of a low share of deliveries from wholly owned projects. See note 5 for a further specification of inventory.
Equity was NOK 2 467.2 million (NOK 3 099.4 million) at 31 March, corresponding to an equity ratio of 40.4 per cent (47.1 per cent). Selvaag Bolig ASA paid a supplementary dividend of NOK 2 055.3 million in the first quarter, following the transaction with Urban Property. Non-controlling interests amounted to NOK 7.9 million (NOK 7.9 million) of equity.
Other current non-interest-bearing liabilities for the group totalled NOK 661.8 million (NOK 521 million) at 31 March, of which NOK 296.7 million (NOK 269 million) represented advance payments from customers.
At 31 March, consolidated interest-bearing debt amounted to NOK 2 517.3 million (NOK 2 560.9 million), of which NOK 1 171.5 million (NOK 1 942.8 million) was non-current and NOK 1 345.8 million (NOK 618.1 million) was current. NOK 863.6 million of current debt related to repurchase agreements with Urban Property. See note 7 for more information.
The group had land loans totalling NOK 294.5 million (NOK 1 357.2 million) at 31 March. This decline primarily reflected the fact that a large part of the properties are financed through Urban Property and are classified as current liabilities repurchase agreements. See above. Land loans are normally converted to construction loans in line with the progress of the respective construction projects.
Selvaag Bolig ASA has a credit facility agreement of NOK 150 million with DNB, which matures in April 2022. This facility was reduced from NOK 500 million to NOK 150 million in January 2020 in connection with the sale of parts of the land bank to Urban Property. The company also has an annually renewed overdraft facility of NOK 150 million with DNB. No drawings had been made against any of these facilities at 31 March.
| (figures in NOK 1 000) | Q1 2020 | Q1 2019 | 2019 |
|---|---|---|---|
| Non-current interest-bearing debt | 1 171 507 | 1 942 798 | 1 092 288 |
| Current interest-bearing debt | 482 218 | 618 091 | 1 161 043 |
| Current liabilities repurchase agreements | 863 579 | - | - |
| Cash and cash equivalents | (771 347) | (565 040) | (1 178 686) |
| Net interest-bearing debt | 1 745 957 | 1 995 849 | 1 074 645 |
The group's interest-bearing debt falls primarily into four categories: 1) top-up loans, which are liabilities in parent company Selvaag Bolig ASA, 2) land loans, 3) repurchase agreements with Urban Property and 4) construction loans. At 31 March, the group had no top-up loans, land loans of NOK 294 million, repayment agreements with Urban Property of NOK 864 million and total construction loans of NOK 1 359 million.
Interest costs on land loans are normally recognised in profit and loss until the site secures planning permission. They are capitalised against the site from the day the project secures planning permission, and recognised in profit and loss as part of the cost of sales when the units are delivered. Interest charges on construction loans are capitalised during the construction period and recognised under cost of sales in the same way.
At 31 March, interest on NOK 270 million in land loans had been capitalised, while interest charges of NOK 24 million relating to land loans were recognised in profit and loss.
Each project is followed up individually in daily operations, and operational reporting accordingly comprises one main segment – housing development. Reporting also comprises the "other business" segment. The latter primarily includes service deliveries in completed Pluss projects as well as group administration not allocated to the main segment. Operational reporting utilises the percentage of completion method for recognising revenues and profit, which differs from the IFRS where profit is recognised on delivery. Note 4 to the financial statements presents segment information reconciled with the financial reporting figures (IFRS).
| Operating revenues | EBITDA | Operating profit/loss | ||||
|---|---|---|---|---|---|---|
| (figures in NOK 1 000) | Q1 20 | Q1 19 | Q1 20 | Q1 19 | Q1 20 | Q1 19 |
| Property development | 744 141 | 671 004 | 194 703 | 188 537 | 248 302 | 210 182 |
| Other | 12 156 | 9 480 | (35 156) | (34 221) | 993 382 | (35 153) |
| IFRS adjustments | (547 187) | (571 325) | (49 297) | (165 821) | (105 238) | (189 831) |
| Total group | 209 110 | 109 159 | 110 250 | (11 505) | 1 136 446 | (14 802) |
This segment comprises all Selvaag Bolig's projects regardless of geographical location, since each project is followed up individually.
Operating revenues from housing development for the first quarter were NOK 744.1 million (NOK 671 million). They derived from 18 projects (19) in production.
Operating costs, primarily for construction and sales, are directly related to the projects and amounted to NOK 549.4 million (NOK 482.5 million) for the first quarter. Construction costs in the segment reporting are exclusive of directlyrelated financial expenses (interest on construction loans). This differs from the IFRS accounts, where financial expenses are included in project costs on delivery.
EBITDA presents operating profit (loss) before depreciation, gain (loss), and share of profit (loss) from associates. It came to NOK 194.7 million (NOK 188.5 million) for the quarter, corresponding to a profit margin of 26.2 per cent (28.1 per cent).
The other business segment comprises a number of activities in the group which are not regarded as part of the core business on a stand-alone basis. It also includes administration and management which cannot be attributed directly to the projects and are accordingly not allocated to the housing development segment.
Operating revenues for the segment in the first quarter came to NOK 12.1 million (NOK 9.5 million), while operating costs amounted to NOK 47.3 million (NOK 43.7 million). Costs relate largely to remuneration for the administration and management, as well as to central marketing. EBITDA was thereby negative at NOK 35.2 million (NOK 34.2 million).
The transaction with Urban Property implemented in the first quarter of 2020 yielded a consolidated gain of NOK 1 028.7 million. As a result, operating profit for the segment came to NOK 993.4 million (loss of NOK 35.2 million) in the quarter.
All figures are presented net, adjusted for Selvaag Bolig's share of joint ventures, unless otherwise specified.
The market was quiet towards the end of the first quarter as a result of the Covid-19 pandemic. Given the circumstances, Selvaag Bolig nevertheless achieved satisfactory sales. It has made provision for digital viewing, and replaced group with individual viewing. In connection with the reduction in interest rates and the greater flexibility given to banks for lending to young people with purchasing power, the group has initiated a campaign aimed at buyers aged 18-34 which offers the inclusion of white goods and a deposit of NOK 50 000 instead of 10 per cent. This has been well received, and the group's ongoing construction projects are making normal progress.
A total of 196 units with a combined value of NOK 1 031 million were sold during the quarter. Selvaag Bolig's share amounted to 164 units with a combined value of NOK 840 million.
Work started on constructing 15 units during the first quarter, so that Selvaag Bolig had 1 431 units worth some
NOK 6.7 billion under construction at 31 March. A total of 89 units were completed during the quarter.
To manifest value creation in the group, segment reporting shows revenue and costs in the various projects using the percentage of completion method as its accounting principle.
The company has projects in Oslo, Bærum, Asker, Lørenskog, Ski, Stavanger, Sandnes, Sola, Tønsberg, Trondheim, Bergen and Stockholm. However, no projects were under construction in Bærum, Bergen or Sandnes during the first quarter.
| Q1 19 | Q2 19 | Q3 19 | Q4 19 | Q1 20 |
|---|---|---|---|---|
| 243 | 210 | 159 | 140 | 164 |
| 97 | 311 | 174 | 248 | 15 |
| 12 | 307 | 203 | 254 | 89 |
| 29 | 246 | 243 | 214 | 114 |
| 1 534 | 1 538 | 1 510 | 1 504 | 1 431 |
| 70% | 71% | 72% | 70% | 76% |
| 13 | 48 | 34 | 56 | 37 |
| 7 097 | 7 039 | 7 192 | 7 155 | 6 742 |
The transaction with Urban Property was implemented in the first quarter. No new agreements were entered into during the period for the purchase or sale of land.
Total housing sales during the first quarter, including Selvaag Bolig's relative share of joint ventures, amounted to 164 units with a combined sales value of NOK 840 million. These sales comprise Selvaag Bolig's consolidated project companies as well as its relative share of units sold in jointventure projects. Sales in the same period of 2019 totalled 243 units with a combined value of NOK 1 183 million.
Selvaag Bolig started sales during the quarter in three projects, comprising 115 residential units (197).
| Project | No of units Category | Region | |
|---|---|---|---|
| Lervig Brygge | 16 | Flat | Stavanger |
| Landås | 69 | Flat | Greater Oslo |
| Lørenskog Stasjonsby | 30 | Flat | Greater Oslo |
| Total | 115 | ||
Construction began on 15 (97) units during the quarter. At 31 March, Selvaag Bolig consequently had 1 431 (1 534) units under construction. They included 1 309 units in Greater Oslo, 87 in the rest of Norway and 35 abroad.
Construction starts can vary substantially from quarter to quarter, since construction normally only begins when 60 per cent of the value in a project has been sold.
The order backlog at 31 March – in other words, the sales value of the 1 431 (1 534) units then under construction – was NOK 6 742 million (NOK 7 097 million).
A total of 89 (12) units were completed in the first quarter, and 114 (29) – including ones completed earlier – were delivered. The completed units were spread over three projects.
At 31 March, the group held 37 (13) completed but unsold units. Consolidated project companies accounted for 40 (17) of the units delivered, while 74 (12) were in part-owned project companies.
| Project | No of units Category | Region | |
|---|---|---|---|
| Bispelua | 24 | Flat | Greater Oslo |
| Tiedemannsfabrikken | 49 | Flat | Greater Oslo |
| Svea Serenad | 16 | Flat | Stockholm |
| Total | 89 |
Based on anticipated progress for the projects, 104 units are expected to be completed in the second quarter of 2020. Estimated completions for 2020 as a whole amount to 711 units.
The company had 93.77 million issued shares at 31 March, divided between 3 113 shareholders.
The 20 largest shareholders controlled 80.5 per cent of the total number of issued shares. The largest shareholder was Selvaag AS, with a 53.5 per cent holding.
During the quarter, the Selvaag Bolig share varied in price from NOK 42.40 to NOK 76.40. The closing price at 31 March was NOK 46.30, compared with NOK 74.00 at 31 December. The share price accordingly fell by 37 per cent over the quarter. A contributory factor in this decline was the payment of a supplementary dividend of NOK 22.00 per share following the transaction with Urban Property. Corrected for this, the share price was down by 7.7 per cent over the first quarter.
A total of just over 13.7 million shares, or 14.6 per cent of the overall number outstanding, were traded during the period. Share turnover totalled NOK 835.2 million during the quarter, corresponding to an average daily figure of roughly NOK 12.8 million.
| Shareholder | # of shares | % share |
|---|---|---|
| SELVAAG AS | 50 180 087 | 53.5% |
| LANDSFORSAKRINGAR FASTIGHETSFOND | 8 356 652 | 8.9% |
| Morgan Stanley & Co. Int. Plc.* | 2 664 220 | 2.8% |
| State Street Bank and Trust Comp* | 2 568 454 | 2.7% |
| PARETO INVEST AS | 2 008 605 | 2.1% |
| VERDIPAPIRFONDET ALFRED BERG GAMBAK | 1 397 062 | 1.5% |
| J.P. Morgan Bank Luxembourg S.A.* | 1 211 153 | 1.3% |
| MUSTAD INDUSTRIER AS | 700 000 | 0.7% |
| Landkreditt Utbytte | 700 000 | 0.7% |
| Brown Brothers Harriman & Co.* | 634 500 | 0.7% |
| BANAN II AS | 600 000 | 0.6% |
| HOLTA INVEST AS | 591 002 | 0.6% |
| BARCLAYS CAPITAL SEC. LTD FIRM | 582 741 | 0.6% |
| SPARHANS AS | 547 221 | 0.6% |
| VERDIPAPIRFONDET EIKA SPAR | 528 300 | 0.6% |
| SANDEN AS | 518 186 | 0.6% |
| VERDIPAPIRFONDET EIKA NORGE | 446 300 | 0.5% |
| TMAM EUROPEAN REAL ESTATE SEC | 429 581 | 0.5% |
| Morgan Stanley & Co. International | 422 908 | 0.5% |
| VERDIPAPIRFONDET HOLBERG NORGE | 400 000 | 0.4% |
| Total 20 largest shareholders | 75 486 972 | 80.5% |
| Other shareholders | 18 278 716 | 19.5% |
| Total number of shares | 93 765 688 | 100.0% |
* Further information regarding shareholders is presented at: http://sboasa.no/en
As a housing developer, Selvaag Bolig is exposed to risks which could affect the group's business and financial position. Risk factors relate to land development, sales and the execution of housing projects, and can be divided into market, operational and financial categories. The group gives priority to work on managing and dealing with risk, and has established routines and control systems to limit and control risk exposure.
Macroeconomic conditions – particularly unemployment and interest rates – as well as demographic changes are factors which affect the group's progress. See the company's annual report, available on its website, for a more detailed explanation of the risk and uncertainty factors it faces.
See the separate section on risks and measures related to Covid-19.
The general meeting of Selvaag Bolig approved in December 2019 the sale of a large proportion of the company's land holdings to a separate company structure, Urban Property. Selvaag AS owns 30 per cent of the latter. The transaction was implemented in January 2020. See note 7 for further details. See note 23 to the group's annual reports for detailed information on transactions with related parties in earlier years.
According to Statistics Norway (SSB), seasonally adjusted Norwegian house prices at 31 March were on average 0.1 per cent lower than at 31 December and up by 1.9 per cent from 31 March 2019. Price developments differed between Selvaag Bolig's core areas during the quarter. Overall prices fell by 0.5 per cent during the quarter in Oslo including Bærum, and were three per cent higher than at 31 March 2019. In Akershus county excluding Bærum, prices fell by 0.6 per cent
and were up by 2.1 per cent from 31 March 2019. Prices in Stavanger rose by 5.1 per cent during the quarter and were up by 1.2 per cent from 31 March 2019. Prices in Bergen were up by 0.7 per cent in the quarter and by 3.6 per cent from 31 March 2019. In Trondheim, prices rose by 0.4 per cent for the quarter and were 1.4 per cent higher than at 31 March 2019.
| (figures in NOK 1 000, except earnings per share) | Note | Q1 2020 | Q1 2019 | 2019 |
|---|---|---|---|---|
| Revenues | 195 923 | 92 791 | 3 282 480 | |
| Other revenues | 13 187 | 16 368 | 86 358 | |
| Total operating revenues | 209 110 | 109 159 | 3 368 838 | |
| Project expenses | (133 891) | (69 510) (2 279 485) | ||
| Salaries and personnel costs | (30 351) | (27 154) | (132 213) | |
| Depreciation and amortisation | (2 495) | (3 297) | (12 748) | |
| Other operating expenses | (21 280) | (29 582) | (141 909) | |
| Total operating expenses | (188 017) | (129 543) | (2 566 355) | |
| Associated companies and joint ventures | 86 662 | 5 582 | 62 224 | |
| Other gains (losses), net | 7 | 1 028 691 | - | - |
| Operating profit | 1 136 446 | (14 802) | 864 707 | |
| Financial income | 4 246 | 2 836 | 16 742 | |
| Financial expenses | (4 183) | (8 624) | (27 480) | |
| Net financial expenses | 63 | (5 788) | (10 738) | |
| Profit/(loss) before taxes | 1 136 509 | (20 590) | 853 969 | |
| Income taxes | (7 514) | 5 348 | (199 454) | |
| Net income | 1 128 995 | (15 242) | 654 515 | |
| Other comprehensive income/expenses | ||||
| Translation differences | 11 435 | (1) | (6) | |
| Total comprehensive income/(loss) for the period | 1 140 430 | (15 243) | 654 509 | |
| Net income for the period attributable to: | ||||
| Shareholders in Selvaag Bolig ASA | 1 128 995 | (15 242) | 654 515 | |
| Total comprehensive income/(loss) for the period attributable to: |
||||
| Shareholders in Selvaag Bolig ASA | 1 140 430 | (15 243) | 654 509 | |
| Earnings per share for net income/(loss) attributed to shareholders in Selvaag Bolig ASA: |
||||
| Earnings per share (basic and diluted) in NOK | 12.08 | (0.16) | 7.04 |
The consolidated financial information has not been audited
| (figures in NOK 1 000) | Note | Q1 2020 | Q1 2019 | 2019 |
|---|---|---|---|---|
| ASSETS | ||||
| Non-current assets | ||||
| Goodwill | 383 376 | 383 376 | 383 376 | |
| Property, plant and equipment | 5 506 | 7 611 | 5 588 | |
| Right-of-use lease assets | 41 908 | 51 284 | 44 219 | |
| Investments in associated companies and joint ventures | 512 199 | 398 862 | 430 281 | |
| Loans to associated companies and joint ventures | 84 092 | 124 670 | 70 893 | |
| Other non-current assets | 123 693 | 306 235 | 165 283 | |
| Total non-current assets | 1 150 774 | 1 272 038 | 1 099 640 | |
| Current assets | ||||
| Inventories (property) | 5, 7 | 4 053 949 | 4 614 891 | 3 636 663 |
| Trade receivables | 85 307 | 61 535 | 82 220 | |
| Other current receivables | 41 152 | 69 975 | 51 052 | |
| Cash and cash equivalents | 771 347 | 565 040 | 1 178 686 | |
| Assets held for sale | 7 | - | - | 864 171 |
| Total current assets | 4 951 755 | 5 311 441 | 5 812 792 | |
| TOTAL ASSETS | 6 102 529 | 6 583 479 | 6 912 432 | |
| EQUITY AND LIABILITIES | ||||
| Equity attributed to shareholders in Selvaag Bolig ASA | 2 459 379 | 3 091 527 | 3 374 218 | |
| Non-controlling interests | 7 866 | 7 866 | 7 866 | |
| Total equity | 2 467 245 | 3 099 393 | 3 382 084 | |
| LIABILITIES | ||||
| Non-current liabilities | ||||
| Pension liabilities | 1 172 | 277 | 1 017 | |
| Deferred tax liabilities | 46 453 | 93 011 | 24 444 | |
| Provisions | 60 372 | 60 373 | 60 373 | |
| Other non-current liabilities | 7 | 6 996 | 2 812 | 3 105 |
| Non-current lease liabilities | 33 131 | 41 204 | 35 263 | |
| Non-current interest-bearing liabilities | 1 171 507 | 1 942 798 | 1 092 288 | |
| Total non-current liabilities | 1 319 631 | 2 140 475 | 1 216 490 | |
| Current liabilities | ||||
| Current lease liabilities | 8 073 | 9 821 | 7 922 | |
| Current interest-bearing liabilities | 482 218 | 618 091 | 1 161 043 | |
| Current liabilities repurchase agreements | 7 | 863 579 | - | - |
| Trade payables | 144 460 | 134 144 | 167 633 | |
| Current tax payables | 155 559 | 60 534 | 208 488 | |
| Other current non-interest-bearing liabilities | 661 764 | 521 021 | 710 728 | |
| Liabilities directly associated with assets classified as held for sale | 7 | - | - | 58 044 |
| Total current liabilities | 2 315 653 | 1 343 611 | 2 313 858 | |
| Total liabilities | 3 635 284 | 3 484 087 | 3 530 348 | |
| TOTAL EQUITY AND LIABILITIES | 6 102 529 | 6 583 479 | 6 912 432 |
| Cumulative | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Share | Other | translation | Equity attributed | Non | |||||
| Share | premium | paid-in | difference | Other | Retained | to shareholders in | controlling | ||
| capital | account | capital | s | reserves | earnings | Selvaag Bolig ASA | interests | Total equity | |
| Equity at 1 January 2020 | 186 842 | 1 394 857 | 700 629 | 5 786 | 3 528 | 1 082 575 | 3 374 220 | 7 866 * | 3 382 084 |
| Transactions with owners: | |||||||||
| Dividend | - | - | - | - | - | (2 055 269) | (2 055 269) | - | (2 055 269) |
| Share buy back | - | - | - | - | - | - | - | - | - |
| Employee share programme | - | - | - | - | - | - | - | - | - |
| Dividend to non-controlling interests | - | - | - | - | - | - | - | - | - |
| Total comprehensive income/(loss) for the period: | |||||||||
| Net income/(loss) for the period | - | - | - | - | - | 1 128 995 | 1 128 995 | - | 1 128 995 |
| Other comprehensive income/(loss) for the period | - | - | - | 11 435 | - | - | 11 435 | - | 11 435 |
| Equity at 31 March 2020 | 186 842 | 1 394 857 | 700 629 | 17 221 | 3 528 | 156 301 | 2 459 381 | 7 866 * | 2 467 245 |
| Equity at 1 January 2019 | 183 523 | 1 394 857 | 700 629 | 5 792 | 3 528 | 816 106 | 3 106 772 | 9 366 * | 3 116 136 |
| Transactions with owners: | |||||||||
| Dividend | - | - | - | - | - | - | - | - | - |
| Share buy back | - | - | - | - | - | - | - | - | - |
| Employee share programme | - | - | - | - | - | - | - | (1 500) | (1 500) |
| Total comprehensive income/(loss) for the period: | |||||||||
| Net income/(loss) for the period | - | - | - | - | - | (15 242) | (15 242) | - | (15 242) |
| Other comprehensive income/(loss) for the period | - | - | - | (1) | - | - | (1) | - | (1) |
| Equity at 31 March 2019 | 183 523 | 1 394 857 | 700 629 | 5 791 | 3 528 | 800 864 | 3 091 529 | 7 866 * | 3 099 392 |
| Transactions with owners: | |||||||||
| Dividend | - | - | - | - | - | (418 179) | (418 179) | - | (418 179) |
| Share buy back | - | - | - | - | - | - | - | - | - |
| Employee share programme | 985 | - | - | - | - | 30 133 | 31 118 | - | 31 118 |
| Dividend to non-controlling interests | - | - | - | - | - | - | - | - | - |
| - | - | - | - | - | - | - | - | - | |
| Total comprehensive income/(loss) for the period: | |||||||||
| - | - | - | - | - | - | - | - | - | |
| Net income/(loss) for the period | - | - | - | - | - | 669 757 | 669 757 | - | 669 757 |
Other comprehensive income/(loss) for the period - - - (5) - - (5) - (5) Equity at 31 December 2019 184 508 1 394 857 700 629 5 786 3 528 1 082 575 3 374 221 7 866 * 3 382 084
The consolidated financial information has not been audited.
* Non-controlling interests include tax from profits in companies subject to partnership taxation. Income taxes in the group do not include taxes from
tax subjects outside the Selvaag Bolig group.
| (figures in NOK 1 000) | Note | Q1 2020 | Q1 2019 | 2019 |
|---|---|---|---|---|
| CASH FLOW FROM OPERATING ACTIVITIES | ||||
| Profit/(loss) before taxes | 1 136 509 | (20 590) | 853 969 | |
| Income taxes paid | (60 443) | (48 828) | (158 888) | |
| Depreciation and amortisation | 2 495 | 3 297 | 12 748 | |
| Other gains (losses), net | 7 | (1 028 691) | - | - |
| Disposal of assets and liabilities held for sale Share of profits/(losses) from associated companies |
7 | 1 681 231 | - | - |
| and joint ventures | (86 662) | (5 582) | (62 224) | |
| Changes in inventories (property) | 5 | (396 100) | (296 687) | 62 734 |
| Changes in trade receivables | (3 087) | 153 472 | 132 787 | |
| Changes in trade payables | (23 173) | (90 616) | (13 727) | |
| Changes in other operating working capital assets | 8 683 | (11 646) | 10 189 | |
| Changes in other operating working capital liabilities | (48 143) | (40 921) | 148 312 | |
| Net cash flow from operating activities | 1 182 619 | (358 101) | 985 901 | |
| CASH FLOW FROM INVESTMENT ACTIVITIES | ||||
| Proceeds from sale of property, plant and equipment | ||||
| and intangible assets | - | - | 100 | |
| Purchases of PPE and intangible assets | (35) | - | (453) | |
| Proceeds from sale of associated companies | - | - | 44 500 | |
| Purchases of associated companies and joint | ||||
| ventures | (5 065) | - | (19 219) | |
| Proceeds from sale of other investments and | ||||
| repayment of loans | 7 | 244 752 | 22 000 | 22 000 |
| Purchases of other investments and loans | (29 500) | (4 300) | (22 300) | |
| Dividends and disbursements from associated | ||||
| companies and joint ventures | 10 000 | 22 000 | 39 500 | |
| Net cash flow from investment activities | 220 152 | 39 700 | 64 128 | |
| CASH FLOW FROM FINANCING ACTIVITIES | ||||
| Proceeds from borrowings | 7 | 1 256 544 | 279 842 | 1 398 284 |
| Repayments of borrowings | 7 | (1 009 904) | (49 709) | (1 518 391) |
| Repayments of lease liabilities | (1 981) | (2 614) | (10 454) | |
| Dividends paid to equity holders of Selvaag Bolig ASA | (2 055 269) | - | (418 179) | |
| Payment of profit sharing and dividends to non | ||||
| controlling interests in subsidiaries | - | (1 500) | (1 500) | |
| Proceeds from disposal of shares Selvaag Bolig ASA | 500 | 388 | 21 864 | |
| Net cash flow from financing activities | (1 810 110) | 226 406 | (528 377) | |
| Net change in cash and cash equivalents | (407 339) | (91 994) | 521 652 | |
| Cash and cash equivalents at start of period | 1 178 686 | 657 034 | 657 034 | |
| Cash and cash equivalents at end of period | 771 347 | 565 040 | 1 178 686 |
The consolidated financial information has not been audited
Selvaag Bolig ASA (the "company") and its subsidiaries (together "the group") is a property development group, involved in the construction of residential property for sale in the ordinary course of business. The condensed consolidated interim financial information consists of the group and the group's interest in associated companies and jointly controlled entities.
The group's consolidated financial information have been prepared in accordance with IAS 34 Interim Financial Reporting. The report does not include all the information and disclosures required for annual financial statements and should be read in conjunction with the group's consolidated financial statements for 2019.
The accounting policies applied in preparing these interim condensed consolidated financial statements are otherwise consistent with those applied in the group's consolidated financial statements for the year ended 31 December 2019.
The preparation of interim financial information requires management to make judgements, estimates and assumptions which affect the application of accounting principles and the reported amounts of assets and liabilities, income and expenses. Actual results may differ from these estimates.
In preparing this consolidated interim financial information, the significant judgements made by management in applying the group's accounting policies and the key sources of estimation uncertainty were largely the same as those which applied in the consolidated financial statements for the year ended 31 December 2019.
See note 23 to the consolidated financial statements for 2019 for detailed information on related-party transactions in previous years.
The main segment is defined as property development. in addition, the other segment consists of services and estate agent as well as unallocated revenues and costs.
The group utilises the percentage of completion method in its internal reporting for which the degree of completion is estimated on the basis of expenses incurred relative to total estimated costs and sales rate. Operating profit (loss) under the percentage of completion method also includes an estimated profit element. The consolidated income statement is based on the completed contract method, in which revenue is recognised at the time of transfer of risk and control, being the point of delivery of the property. A reconciliation of this effect (from stage of completion to completed contract) can be found in the segment reporting under "Reconciliation EBITDA to operating profit (loss)".
Group management considers segment results based on the percentage of completion method for determining EBITDA. The method of measurement is defined as operating profit (loss) before "Depreciation and amortisation", "Other gain (loss), net", and "Share of income (losses) from disposals from associated companies and joint ventures". Financial income and expenses are not allocated to operating segments since this type of activity is managed by a central finance function focused on managing the group's liquidity.
.
| Property | |||
|---|---|---|---|
| (figures in NOK 1 000) | development | Other | Total |
| Operating revenues | 744 141 | 12 156 | 756 297 |
| Project expenses | (542 370) | (261) | (542 631) |
| Other operating expenses | (7 068) | (47 051) | (54 119) |
| EBITDA (percentage of completion) | 194 703 | (35 156) | 159 547 |
| Reconciliation EBITDA to operating profit (loss) | |||
| EBITDA (percentage of completion) | 194 703 | (35 156) | 159 547 |
| Sales revenues (adjustment effect of percentage of completion) | (741 260) | - | (741 260) |
| Sales revenues (completed contract) | 194 073 | - | 194 073 |
| Project expenses (adjustment effect of percentage of completion) | 539 329 | - | 539 329 |
| Project expenses (completed contract) | (130 589) | - | (130 589) |
| Lease liabilities | 2 488 | - | 2 488 |
| Depreciation and amortisation | - | (2 495) | (2 495) |
| Share of income (losses) from associated companies and | |||
| joint ventures | 86 662 | - | 86 662 |
| Other gain (loss), net | - | 1 028 691 | 1 028 691 |
| Operating profit (loss) | 145 406 | 991 040 | 1 136 446 |
| Units under construction | 1 431 | N/A | N/A |
| Units delivered | 114 | N/A | N/A |
| Property | |||
|---|---|---|---|
| (figures in NOK 1 000) | development | Other | Total |
| Operating revenues | 671 004 | 9 480 | 680 484 |
| Project expenses | (466 675) | (143) | (466 818) |
| Other operating expenses | (15 792) | (43 558) | (59 350) |
| EBITDA (percentage of completion) | 188 537 | (34 221) | 154 316 |
| Reconciliation EBITDA to operating profit (loss) | |||
| EBITDA (percentage of completion) | 188 537 | (34 221) | 154 316 |
| Sales revenues (adjustment effect of percentage of completion) | (663 852) | - | (663 852) |
| Sales revenues (completed contract) | 92 527 | - | 92 527 |
| Project expenses (adjustment effect of percentage of completion) | 466 611 | - | 466 611 |
| Project expenses (completed contract) | (69 303) | - | (69 303) |
| Lease liabilities | 2 614 | - | 2 614 |
| Depreciation and amortisation | - | (3 297) | (3 297) |
| Share of income (losses) from associated companies and | |||
| joint ventures | 5 582 | - | 5 582 |
| Other gain (loss), net | - | - | - |
| Operating profit (loss) | 22 716 | (37 518) | (14 802) |
| Units under construction | 1 534 | N/A | N/A |
| Units delivered | 29 | N/A | N/A |
The group has property which comprises land and buildings intended for sale in the ordinary course of business or in the process of construction or development for such sale. Inventories thus comprise land, property held for resale,
and property under development and construction. Inventories are measured at the lower of cost and net realisable value.
| (figures in NOK 1 000) | Q1 2020 | Q1 2019 | 2019 |
|---|---|---|---|
| Land (undeveloped) | 1 062 463 | 1 590 653 | 1 020 774 |
| Work in progress | 2 855 127 | 2 922 818 | 2 433 245 |
| Completed units | 136 359 | 101 420 | 182 644 |
| Carrying amount | 4 053 949 | 4 614 891 | 3 636 663 |
The group expenses all directly attributable costs in construction projects as project expenses. This includes financial expenses. Below is a specification showing the
project cost and EBITDA including and excluding financial expenses.
| (figures in NOK 1 000) | Q1 2020 | Q1 2019 | 2019 |
|---|---|---|---|
| Project expenses | (133 891) | (69 510) | (2 279 485) |
| Finance expenses | (7 075) | (2 554) | (81 906) |
| Other project expenses | (126 816) | (66 956) | (2 197 579) |
| (figures in NOK 1 000) | Q1 2020 | Q1 2019 | 2019 |
| EBITDA* | 110 250 | (11 505) | 877 455 |
| EBITDA margin | 52.7% | -10.5% | 26.0% |
| EBITDA adjusted** | 117 325 | (8 951) | 959 361 |
| EBITDA margin adjusted | 56.1 % | -8.2% | 28.5% |
* EBITDA is operating profit before interest, taxes, depreciation, amortisation and other gains (losses).
** EBITDA adjusted excludes financial expenses included in project costs.
Profit for the first quarter includes NOK 1 028.7 million in recognised gain from the transaction with Urban Property. This has been excluded from the calculation of EBITDA above. The other large increase in EBITDA during the first quarter reflected the high share of deliveries in joint
The group entered in the fourth quarter of 2019 into an agreement to sell a substantial proportion of the land it owned where construction had yet to start (the transaction) to Urban Property (UP). The transaction was implemented on 21 January 2020. The purpose of the transaction was to reduce the group's financial borrowings and tied capital, and to free up substantial added value in the Selvaag Bolig (SBO) portfolio of properties which has increased the group's capacity to pay dividend. Through options and pre-emption agreements with UP, the group will have the opportunity to buy back part of the properties sold in stages as and when required for further development and construction.
ventures, since profit from these is presented net and not included in turnover. For more information, see note 8 on proportional consolidation, which presents the effect if the joint ventures had been included with their share of turnover – in other words, not presented net.
The transaction covered properties divided into Portfolios A, B and C. Portfolio A comprised properties expected to be bought back through the exercise of a pre-emptive right within a longer timeframe extending beyond 2020. Portfolio B comprised properties where the group has buyback options which primarily fall within a timeframe expected to be shorter than 31 December 2020. Portfolio C covered future land purchase agreements, and prepayments related to these, with third parties where the group did not own the properties at the time. The transaction also included the purchase by UP of two companies which took the form of joint ventures between SBO and Veidekke Eiendom AS and NHP Eiendom AS
respectively. Portfolios B and C are covered by options for the group to buy back the properties later. SBO and UP intend to pursue a long-term collaboration, so that SBO will also obtain options to purchase land which UP acquires in the future. The intention is that UP will enter into agreements on acquiring new properties in the market, and that SBO will have an option to buy these from UP.
The accounting effects of the transaction for Portfolios A, B and C as well as for the sale of interests in joint ventures are discussed in more detail below.
The consideration for shares and settlement of intercompany liabilities related to Portfolio A was NOK 1 542 million. The carrying amount of these properties at 31 December 2019 was NOK 657 million. The transaction was implemented in the first quarter of 2020 and the interim financial statements reflect a net gain of NOK 921 million on the sale of Portfolio A properties. That includes associated tax positions.
A pre-emptive right is held by the group to buy back the land if UP decides on a sale. However, the group cannot at any time require UP to sell the properties.
Further information on the sale of Portfolio A properties is presented in the tables below.
At 31 December 2019, SBO owned 50 per cent of Sinsenveien Holding AS and 50 per cent of Haakon VII's Gate 4 Holding AS. Both joint venture holdings were sold in their entirety (100 per cent) in the transaction, with shareholder loans also being redeemed.
The holdings have been treated in the SBO financial statements as associated companies pursuant to IAS 28 Investments in Associates and Joint Ventures. These investments were owned 50 per cent by external owners and 50 per cent by SBO with equal interests, and the equity method was applied in SBO's consolidated financial statements.
Following the sale of the two holdings in the joint ventures through the transaction, SBO no longer owns any shares in Sinsenveien Holding AS and Haakon VII's Gate 4 Holding AS. The sale has therefore been recognised in its entirety in profit and loss. The sale of the two holdings yielded a gain of NOK 126 million and had a cash effect of NOK 202 million in the first quarter. Included in the consideration was NOK 17 million in settlement of further shareholder loans provided by SBO in January before implementation of transaction.
These properties were recognised with a total carrying amount of NOK 679 million at the transaction date. The total consideration amounted to NOK 864 million.
In accounting terms, the sale of Portfolio B with buy-back agreements (in other words, including purchase options) does not involve the calculation of either gain or loss, but has been treated as a financing arrangement because SBO retains control of these properties. This means that the carrying amount of Portfolio B remains unchanged as inventory after the transaction, while the consideration of NOK 864 million from the sale of Portfolio B has been recognised as a liability for repurchase agreements (to UP) in the SBO balance sheet.
The option premium related to the properties in Portfolio B is paid quarterly and corresponds to three months Nibor plus a margin of 3.75 per cent annually. These premiums are treated for accounting purposes in the same way as interest charges on land loans. They are recognised in the balance sheet as part of inventory and expensed as cost of sales when completed residential units are delivered. NOK 9 million in option premiums was paid and capitalised for land in portfolio B during the first quarter. SBO can cancel the option at any given time on payment of a fixed break fee corresponding to 48 months of option premiums for the property.
Portfolio C covered properties which the group had the right or obligation to purchase in the future. An agreement has been entered into which means that UP acquires rights and obligations corresponding to those currently held by the group in relation to the landowners. SBO will remain the formal counterparty to the present landowners. The agreement covers agreements on future property acquisitions. After UP has acquired a property, SBO will have an option to buy it back on specified terms.
In addition, Portfolio C included a compensation of NOK 143 million from UP for advance payments made by SBO to today's landowners for future land purchase. A 2.5 per cent deduction has been made from this amount, which has been recognised as a deduction of NOK 3.6 million from the net gain on the transaction.
The option premium related to land in Portfolio C corresponds to three months Nibor plus a margin of 3.75 per cent annually. Fifty per cent of this premium falls due when SBO acquires the land from UP, with the remainder falling due on completion of the relevant project. Provision for accrued option premiums is made quarterly in SBO's consolidated accounts, as other non-current assets and other non-current liabilities respectively. The asset is reclassified as inventory when the land is taken over. NOK 1.5 million in option premiums for Portfolio C was made
provision for and capitalised in the first quarter. SBO can cancel the option at any given time in exchange for a break fee comprising the accumulated rise in the buy-back price for the property plus a fixed supplement corresponding to 48 months of growth in this price.
Costs conditional on implementing the transaction amounted to NOK 15 million. These are recognised as a deduction from the net gain.
The following table provides an overview of the estimated accounting effects of the transaction for Portfolios A, B and C as well as for the sale of associated companies.
| Carrying | |||||||
|---|---|---|---|---|---|---|---|
| Statement of financial position | value | Joint | Total | ||||
| Amounts in NOK 1 000 | 31.12.2019 | Portfolio A | Portfolio B | Portfolio C | ventures | Financing | change |
| Disposal group preseted as asset held for sale | |||||||
| Inventory Portfolio A | 656 537 | (656 537) | (656 537) | ||||
| Prepayments for property acquistions | 143 000 | (143 000) | (143 000) | ||||
| Receivable from joint ventures | 58 632 | (75 681) | (75 681) | ||||
| Investments in joint ventures | |||||||
| Total asset held for sale in the balance sheet 31.12.2019 | 858 169 | (656 537) | (143 000) | (75 681) | (875 218) | ||
| Liabilities part of the disposal group presented as held for sale | |||||||
| Deferred tax liabilities | 52 473 | (52 473) | (52 473) | ||||
| Other assets influenced by in the transaction | - | ||||||
| Cash (representing net consideration from UP) | 1 541 806 | 863 579 | 139 425 | 201 664 | (978 517) | 1 767 958 | |
| Inventory Portfolio B | 678 778 | - | |||||
| Other liabilities influenced by the transaction | |||||||
| Interest-bearing liabilities (bank debt) settled as part of the | |||||||
| transaction | (978 517) | (978 517) | |||||
| Financial debt obligation assumed for portfolio B | 863 579 | 863 579 | |||||
| Income tax payable | 16 436 | 16 436 | |||||
| Equity | |||||||
| Equity | 921 305 | (3 575) | 125 984 | 1 043 714 | |||
| Statement of comprehensive income effects in 2020 | Joint | ||||||
| Amounts in NOK 1 000 | Portfolio A | Portfolio B | Portfolio C | ventures | Other | Total | |
| Gain, sale of properties | 921 305 | (3 575) | 917 730 | ||||
| Gain from sale of joint ventures Fees subject to completion of transaction |
(15 023) | 125 984 (15 023) |
|||||
| Profit (loss) before income taxes | 921 305 | (3 575) | (15 023) 1 028 691 | ||||
| Presentation in the cash flow statement in 2020 | Joint | ||||||
| Amounts in NOK 1 000 | Portfolio A | Portfolio B | Portfolio C | ventures | Other | Total | |
| Cash flow from operational activities | 1 541 806 | 139 425 | 1 681 231 | ||||
| Cash flow from investing activities (part of proceeds from sale of | |||||||
| other investments and repayments of loans) | 201 664 | 201 664 | |||||
| Cash flow from financing activities (proceeds from borrowings and | |||||||
| repayments of borrowings) | 863 579 | (978 517) | (114 937) | ||||
| Total cash effect | 1 541 806 | 863 579 | 139 425 | 201 664 | (978 517) 1 767 958 | ||
The table above presents a specification of the assets and liabilities covered by the transaction. It also shows the accounting implications of the transaction, including the effects on profit and loss and cash flow.
Selvaag Bolig executes a number of its housing projects in collaboration with other parties, often on a 50-50 basis. These are recognised in the statement of comprehensive income pursuant to the IFRS using the equity method, where Selvaag Bolig's share of the net result is presented as share of profit/(loss) from associated companies and joint ventures. Selvaag Bolig finds that the number of collaboration projects is increasing and that, in this context, it is relevant to provide information on how the statement of comprehensive income would have appeared were the equity interest in collaboration projects to be consolidated.
In the table below, the statement of comprehensive income pursuant to the IFRS has been restated to show the proportional consolidation of associated companies and joint ventures in accordance with Selvaag Bolig's equity interest in collaboration projects.
| Q1 2020 | Q1 2019 | ||||||
|---|---|---|---|---|---|---|---|
| Pro forma | Pro forma | ||||||
| Adj share | gross | Adj share | gross | ||||
| (figures in NOK 1 000) | IFRS | Assoc/JV gross | Assoc/JV | IFRS | Assoc/JV gross | ||
| Revenues | 195 923 | 370 527 | 566 450 | 92 791 | 70 718 | 163 509 | |
| Other revenues | 13 187 | 4 021 | 17 208 | 16 368 | 11 049 | 27 417 | |
| Total operating revenues | 209 110 | 374 549 | 583 659 | 109 159 | 81 767 | 190 926 | |
| Project expenses | (133 891) | (263 679) | (397 570) | (69 510) | (60 058) | (129 568) | |
| Salaries and personnel costs | (30 351) | (492) | (30 843) | (27 154) | (471) | (27 625) | |
| Depreciation and amortisation | (2 495) | (982) | (3 477) | (3 297) | (2 694) | (5 992) | |
| Other operating expenses | (21 280) | (3 862) | (25 142) | (29 582) | (7 389) | (36 972) | |
| Total operating expenses | (188 017) | (269 014) | (457 031) | (129 543) | (70 613) | (200 157) | |
| Associated companies and joint ventures | 86 662 | (86 662) | - | 5 582 | (5 582) | - | |
| Other gains (losses), net | 1 028 691 | - | 1 028 691 | - | - | - | |
| Operating profit | 1 136 446 | 18 873 | 1 155 319 | (14 802) | 5 572 | (9 231) | |
| Financial income | 4 246 | 53 | 4 299 | 2 836 | 196 | 3 032 | |
| Financial expenses | (4 183) | (1 099) | (5 282) | (8 624) | (3 142) | (11 766) | |
| Net financial expenses | 63 | (1 046) | (983) | (5 788) | (2 946) | (8 734) | |
| Profit/(loss) before taxes | 1 136 509 | 17 827 | 1 154 336 | (20 590) | 2 626 | (17 965) | |
| Income taxes | (7 514) | (17 827) | (25 341) | 5 348 | (2 625) | 2 723 | |
| Net income | 1 128 995 | - | 1 128 995 | (15 242) | - | -15 242 | |
| EBITDA margin * | 52.7% | N/A | 22.3% | -10.5% | N/A | -1.7% | |
| EBITDA margin adj** | 56.1% | N/A | 26.0% | -8.2% | N/A | 1.9% |
* EBITDA is operating profit before interest, taxes, depreciation, amortisation and other gains (losses).
** EBITDA adjusted excludes financial expenses included in project costs. See note 6.
For further information, please contact: Rolf Thorsen, CEO Selvaag Bolig ASA Telephone: +47 901 19 373, e-mail: [email protected]
Sverre Molvik, CFO Selvaag Bolig ASA Telephone: +47 401 00 585, e-mail: [email protected]
Selvaag Bolig ASA is a residential property developer controlling entire value chain from acquisition of land to sale of homes. The company has several thousand homes under development at any given time and focuses on the growth areas in and around Greater Oslo, Bergen, Stavanger and Trondheim. Selvaag bolig represents a continuation of Selvaag`s 70-year history and experience, and offers a broad variety of property types. The company is headquartered at Ullern in Oslo.
www.selvaagboligasa.no
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