prezentacja j.w.construction holding s.a. performance in q 1 200 9
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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.
PRESENTATION PERFORMANCE IN Q1 2009
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
PRESENTATION PERFORMANCE IN Q1 2009
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
PRESENTATION PERFORMANCE IN Q1 2009
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
PRESENTATION PERFORMANCE IN Q1 2009
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
8 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)
9 PRESENTATION PERFORMANCE IN Q1 2009
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
10 PRESENTATION PERFORMANCE IN Q1 2009
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
Development of Affiliated Companies – Strength and Capabilities
STRATEGY - STRATEGY - DIVERSIFYING OPERATIONAL RISK OF THE GROUPDIVERSIFYING OPERATIONAL RISK OF THE GROUP
11 PRESENTATION PERFORMANCE IN Q1 2009
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
Development of Affiliated Companies – Strength and Capabilities
STRATEGY - STRATEGY - DIVERSIFYING OPERATIONAL RISK OF THE GROUPDIVERSIFYING OPERATIONAL RISK OF THE GROUP
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
STRATEGY - STRATEGY - DIVERSIFYING OPERATIONAL RISK OF THE GROUPDIVERSIFYING OPERATIONAL RISK OF THE GROUP
PRESENTATION PERFORMANCE IN Q1 2009
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
STRATEGY - STRATEGY - DIVERSIFYING OPERATIONAL RISK OF THE GROUPDIVERSIFYING OPERATIONAL RISK OF THE GROUP
Office and Commercial Space
PRESENTATION PERFORMANCE IN Q1 2009
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
STRATEGY - STRATEGY - DIVERSIFYING OPERATIONAL RISK OF THE GROUPDIVERSIFYING OPERATIONAL RISK OF THE GROUP
PRESENTATION PERFORMANCE IN Q1 2009
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
STRATEGY - STRATEGY - DIVERSIFYING OPERATIONAL RISK OF THE GROUPDIVERSIFYING OPERATIONAL RISK OF THE GROUP
Hotel Operations
PRESENTATION PERFORMANCE IN Q1 2009
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
16 PRESENTATION PERFORMANCE IN Q1 2009
17 PRESENTATION PERFORMANCE IN Q1 2009
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
PRESENTATION PERFORMANCE IN Q1 2009
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.
ProjectUsable apartment floor
space (sq. m)Revenue (PLN thousand)
Lewandów Park 81 191 443 169
19
Warsaw Market
IMPLEMENTED PROJECTS - OVERVIEWIMPLEMENTED PROJECTS - OVERVIEW
PRESENTATION PERFORMANCE IN Q1 2009
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.
ProjectUsable apartment floor
space (sq. m)Revenue (PLN
thousand)
Osiedle Bursztynowe 17 402 120 316
20
Warsaw Market
IMPLEMENTED PROJECTS - OVERVIEWIMPLEMENTED PROJECTS - OVERVIEW
PRESENTATION PERFORMANCE IN Q1 2009
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.
ProjectUsable apartment floor
space (sq. m)Revenue (PLN thousand)
Wiślana Aleja 9 770 71 925
21
Warsaw Market
IMPLEMENTED PROJECTS - OVERVIEWIMPLEMENTED PROJECTS - OVERVIEW
PRESENTATION PERFORMANCE IN Q1 2009
Ludwinowska Aleja II
Warsaw, Ludwinowska Street
Six cosy semi-detached houses with 24 apartments.
ProjectUsable apartment floor
space (sq. m)Revenue (PLN thousand)
Ludwinowska Aleja II 1 649 13 391
22
Warsaw Market
IMPLEMENTED PROJECTS - OVERVIEWIMPLEMENTED PROJECTS - OVERVIEW
PRESENTATION PERFORMANCE IN Q1 2009
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.
ProjectUsable apartment floor
space (sq. m)Revenue (PLN thousand)
Osada Wiślana 20 445 127 513
23
Warsaw Market
IMPLEMENTED PROJECTS - OVERVIEWIMPLEMENTED PROJECTS - OVERVIEW
PRESENTATION PERFORMANCE IN Q1 2009
24 PRESENTATION PERFORMANCE IN Q1 2009
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
25 PRESENTATION PERFORMANCE IN Q1 2009
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: relacje.inwestorskie@jwconstruction.com.pl
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