Half-year Results

The following replaces the announcement "Interim Results 2024" released on 5 September 2024 at 07:00 under RNS No: 9707C

The announcement previously omitted a responsibility statement which is required by the Transparency (Directive 2004/109/EC) Regulations 2007. All other details remain unchanged, and the full amended text is shown below.

Glenveagh Properties plc

Interim Results 2024

Full year expectations reiterated for a milestone year of growth

Announcing intention to commence €50 million share buyback programme

Glenveagh Properties plc ("Glenveagh" or the "Group") a leading Irish homebuilder announces its Interim Results for the period ended 30 June 2024.

Financial Highlights

1 Excluding development rights

Operational Highlights

• Closed and forward order book totalling approximately €1.4 billion across our three business segments, underpinning our 2,700 completions for FY 2024 and giving strong visibility on deliveries and revenue into FY 2025
• Over 800 units of the 2,700 full year target completed in H1 2024 (H1 2023: 333)
• Suburban completions of 294 units in the first half (H1 2023: 333) have accelerated strongly in the third quarter. The closed and forward order book in the Suburban business is €770 million, comprising 2,215 units for delivery in FY 2024 and early FY 2025. Driven by our enlarged scale, increased standardisation of product and processes, and continued integration of manufacturing, Suburban gross margin is expected to be in excess of 20% in FY 2024, compared to an underlying margin of 19.3% in FY 2023
• Partnerships performance reflected increased construction activity in our Balmoston (Ballymastone) and Oscar Traynor Road sites. A third Partnerships contract for a site adjacent to Balmoston is now completed, with site development works now commenced. We are also advancing a fourth agreement and combined, these agreements will add approximately 1,000 units to our Partnerships pipeline for delivery from FY 2025 onwards
• Urban performance reflected the completion of 510 units from existing forward fund transactions, where approximately 90% of revenue has already been recognised in prior periods. Following the request to join the Land Development Agency ("LDA") framework panel to accelerate the delivery of mixed tenure homes, a partnership with the agency to commence the activation of our Urban portfolio in Cork Docklands, via a forward fund transaction, is subject to final legal agreement
• Strong planning momentum with permissions now granted for approximately 1,500 units so far this year with over 95% of units targeted for FY 2025 now with planning permissions granted
• Good progress with our sustainability ambitions, focussing on implementing actions in line with our strategies on Net Zero transition, biodiversity and circular economy

Disciplined Capital Allocation Supporting Growth and Returns

• As noted in our H1 Trading Statement on 4 July, we see potential to accelerate our future land investment plans and significantly expand our landbank in the near term in highly attractive locations. These investments, should they all materialise, would provide more than 6,000 units across multiple tenures, with an attractive return profile. These acquisitions would also provide potential to secure partnership agreements on adjacent sites for approximately 2,000 units, further enhancing the growth and return potential for that business segment and the Group overall
• Assuming these acquisitions are completed, our landbank value at year end would be approximately €500 million, with our medium-term target remaining at less than €400 million
• We remain committed to returning excess cash identified to shareholders, in accordance with our capital allocation framework. Given our operational and financial position and our confidence in the future cash generation and balance sheet strength of the business, we are pleased to announce the intention to commence on 6 September 2024 a €50 million share buyback programme, having returned over €300 million of capital to shareholders since the beginning of FY 2021
• Net Debt is expected to fall to below €200m by the end of FY 2024. This includes the commencement of our share buyback programme and all anticipated land acquisitions, should they materialise, and is within our guidance range of 15-25% of gross assets, a measure that now aligns with current covenant metrics

Outlook

• FY 2024 is a milestone year of growth for Glenveagh. We operate in a thriving market with strong demand, driven by an outperforming economy, strong population growth, and supportive State initiatives
• Our ability to deliver great value, high-quality, sustainable homes at scale via our proven vertically integrated operation positions the business at the forefront of meeting Ireland's housing needs into the future
• We reiterate our full year EPS guidance which anticipates a more than doubling of EPS to approximately 17 cent in FY 2024 and a Return on Equity target of approximately 15%

CFO Transition

• Glenveagh today announces that Michael Rice has informed the Board that he is stepping down from his role as Executive Director and Chief Financial Officer ("CFO") of Glenveagh to pursue other interests. Michael will step down from the Board on 31 December 2024 but will remain with Glenveagh into 2025 to ensure a smooth transition. Michael will be succeeded in the role of CFO by Conor Murtagh, who is currently Chief Strategy Officer and a member of the Group's Executive Committee.

CEO Stephen Garvey commented:

"Our report today strongly signals that our business remains on a solid trajectory in 2024, achieving significant milestones across all three business segments.

Our ability to consistently deliver high-quality, sustainable homes at scale reflects the strength of our vertically integrated operation and the skill and dedication of our team at Glenveagh. We are on track to deliver on our target of 2,700 homes this year, a critical objective in our role in the sector responding to Ireland's housing needs.

Glenveagh's pioneering of modern methods of construction and our focus on standardisation and innovation are central to our strategy. As we continue to expand, our commitment to sustainability, efficiency, and affordability remains at the core of our operations.

We welcome the Government's ongoing commitment to driving housing completions forward through targeted initiatives that enhance viability, and improvements in the planning system. The momentum we've seen in new home commencements and the growing output across the industry are promising indicators that Ireland can achieve the necessary increase in housing supply. Yet, as we aim to scale our activities further, collaboration between the public and private sectors remains key. It is crucial that we build upon the foundations laid by current initiatives to reach the next phase of output growth-delivering over 50,000 units per annum.

We are confident that with continued targeted policy measures and strategic partnerships involving both capital and land between the public and private sectors, we will not only meet but exceed the housing targets necessary to respond to the housing needs of Ireland's growing population and to bolster and sustain ongoing economic successes."

Results Presentation

A webcast presentation of the results for analysts and institutional investors will take place at 8.30am on 5 September 2024. The presentation slides will be available on the Investor Relations section on www.glenveagh.ie from 7.00am on 5 September 2024.

Conference call: Click here to register for conference call

Audio webcast: Click here for webcast

GLENVEAGH PROPERTIES PLC: BUSINESS AND FINANCIAL REVIEW

• BUSINESS REVIEW
• Group Sales
• Overview

The Group had total revenue of €152.2 million (H1 2023: €171.6 million), primarily driven by the completion of 294 suburban units (H1 2023: 333) in the period and the inclusion of a first-time contribution in H1 Results from our Partnerships business segment.

Suburban

The Group reported suburban revenue of €102.2 million, a reduction of 6.8% from the H1 2023 revenue outturn of €109.7 million.

In H1 2024, 294 suburban units were closed (H1 2023: 333). Completions were impacted by the scheduling of closings which have now accelerated in the third quarter. The Average Selling Price ("ASP") in H1 2024 was approximately €329k (H1 2023: €324k), reflecting underlying House Price Inflation ("HPI") and changes in our product and site mix.

Underlying market demand for new homes remains very strong, driven by a robust economic environment, population growth and a range of supportive demand-side initiatives from the Government.

The Group delivered approximately half of our suburban units as part of these Government support initiatives to provide social, cost rental and affordable housing.

The First Home Scheme, a €480 million fund set up as part of the Government's Housing for All strategy, continues to progress well since its launch in July 2022. The scheme helps first-time buyers, a key target market for Glenveagh, to bridge the gap between their mortgage, deposit and the price of a new home, providing up to 30% of the price of the home. Over 10,600 potential buyers have registered their interest in the Scheme to date, with a significant increase in usage during the first six months of 2024.

Alongside the Government's Help To Buy Scheme and the Central Bank of Ireland's changes to macroprudential rules in early 2023, first-time buyers have enhanced access to new housing developments and improved affordability.

Partnerships

FY 2023 was a milestone year for our Partnerships business segment. Full planning permission was received and construction works commenced on both the Balmoston and Oscar Traynor Road sites in H2 2023 and we reported our first interim revenue and profits contribution in H1 2024.

We are on track to have commenced the construction of almost 1,300 homes under our partnership schemes by the end of FY 2024. We have also lodged a planning application for the next phase of the Balmoston development, comprising approximately 400 mixed tenure units.

A third Partnerships contract for a site adjacent to Balmoston is now signed, with construction anticipated to begin by year end. We are also advancing a fourth agreement and combined, these agreements will add approximately 1,000 units to our Partnerships pipeline for delivery from FY 2025 onwards.

A strong pipeline of partnership opportunities has also been identified for the medium term, partnering with local authorities and the LDA on other State land developments. These have the potential to generate significant and sustainable incremental revenue, profits and returns for the Group over the longer term.

Urban

Urban revenue was €17.7 million in H1 2024 (H1 2023: €61.9 million). This primarily reflects the completion of two of our contracted forward fund projects, Citywest and Castleknock, where approximately 90% of revenue had already been recognised in prior periods. These two projects delivered 510 units in the period.

Several other projects are underway or are in the final stages of negotiations and are detailed in the table below.

Urban revenue in the second half of FY 2024 is expected to comprise the contribution from projects already contracted as well as the new revenue opportunities indicated above. Our commercial office development, the residual non-core asset in the Docklands portfolio, has completed construction with a first tenant now contracted for a portion of the building and we continue to explore opportunities for this asset.

Forward Order Book

The continued strength of the Irish market is demonstrated through our strong forward order book which now totals approximately €1.4 billion. This provides us with strong visibility on revenue and deliveries for the remainder of FY 2024 and into early FY 2025.

The closed and forward order book in the suburban business is €770 million, comprising 2,215 units. Strong reservation rates in our Suburban business segment reflects strong underlying private market demand that is supported by the resilience of the domestic economy, the range of Housing for All initiatives, and further underpinned by the structural undersupply across the market of high-quality, affordable housing in Ireland.

The forward order book also includes revenue to be recognised from the transactions within the Urban business segment, as well as the contracted element of the Partnerships business segment.

We are currently active on 21 sites across our business segments, with a focus on delivering higher output from larger sites to further enhance operational efficiencies.

Planning Progress and Policy

Strong planning momentum has continued with permissions granted for approximately 1,500 units to date in FY 2024. The Group has planning permission for all of its expected deliveries in FY 2024 and for over 95% of units targeted for FY 2025 delivery.

We also remain on track to lodge planning applications for over 2,000 units over the course of this year, further underpinning unit delivery in FY 2025 and beyond.

It is evident that the Government's range of demand and supply side incentives, coupled with enhanced compact growth guidelines and encouraging improvements in planning policy and system, are having the desired effect on industry performance and output.

Building on this momentum is critical so that the industry can meet the next phase of output growth, to deliver well over 50,000 homes per annum.

Effective delivery requires comprehensive resourcing of all aspects of the design, planning and development lifecycle and streamlined design standards at a national level. This, alongside effective partnering with local authorities and the LDA, will enable the industry and private sector capital to work together with the State to accelerate supply in a sustainable manner.

Development Land Portfolio Management

Our approach to land acquisitions and portfolio management is both disciplined and strategic, with a focus on maintaining a land portfolio at scale for a period of 4-5 years.

The Group's land investment, excluding development rights, was €411.1 million at 30 June 2024 (31 December 2023: €403.8 million). Development rights decreased from €29.3 million at 31 December 2023 to €27.9 million at 30 June 2024 reflecting the utilisation of certain development rights associated with our partnership agreements for Balmoston and Oscar Traynor Road.

The Group's land portfolio currently comprises over 13,100 units with an average plot cost of approximately €33k. The Suburban segment accounts for 68% of the portfolio by units, with the remainder comprising the Partnerships segment (17%) and the Urban segment (15%). Almost 70% of the overall portfolio is in the Greater Dublin Area.

The Group spent or contracted to spend a total of approximately €21.5 million on three land sites in H1 2024. These sites have the capacity to deliver approximately 550 new own-door housing in sustainable communities.

In addition, we have continued to progress negotiations on several acquisition opportunities. These opportunities, should they all materialise, would provide in excess of 6,000 new units across multiple tenures, some of which can be delivered from FY 2025. These acquisitions would also provide potential to secure partnership agreements on adjacent sites for approximately 2,000 units, further enhancing the growth and return potential for that business segment and the Group overall.

Input Cost Inflation

The construction sector continued to face some inflationary pressures across its raw material and labour costs base in H1 2024, though at a lesser level than experienced in FY 2022 and FY 2023.

To manage the effects of inflation, we have implemented several strategies. We work closely with our supply chain partners to ensure competitive and sustainable pricing while maintaining a secure supply. Additionally, our size and purchasing power allow us to negotiate favourable terms and pricing with suppliers. Our supply chain integration strategy also gives us greater control over input costs.

Development levies were removed by the Government in April 2023 for a limited time subject to certain criteria being met, a measure that has partly mitigated against cost pressures across the industry.

These mitigation strategies enabled us to manage build cost inflation to a low single digit percentage level in H1 2024.

Supply Chain Integration - NUA

NUA has exhibited a strong performance in H1 2024, underpinned by its commitment to safety, innovation, and efficiency. The business leverages advanced technology in three factories located in close proximity to our main geographical areas of focus, setting a benchmark in modern construction methods. This innovation underpins our ambition to provide high-quality and accessible homes, showcasing excellence and customer satisfaction. NUA has the capacity to deliver frames for over 2,000 homes per year working on a single shift, focusing on the off-site panellised manufacture using timber frame and light gauge steel.

The Group's focus on standardising house types and investing in offsite manufacturing has been instrumental in ensuring effective delivery and high build quality. At Glenveagh, standardisation is a core principle that drives operational excellence and efficiency across design and house type layouts, mechanical and electrical layouts, and other processes. This attention to detail ensures consistency and quality across all projects, helping us to manage costs and reduce our environmental impact.

The combination of NUA and the increasing standardisation of our product and process means that we can plan, design, and build houses more effectively, with greater efficiency and speed, and in greater numbers than ever before whilst managing our resources more efficiently. This in turn supports an improved margin and return profile for the Group overall.

Sustainability Agenda Progress

We have continued to progress our sustainability ambitions, focussing on implementing actions in line with our strategies on Net Zero transition, biodiversity and circular economy. We continue to work towards our science-based targets which were verified by the Science Based Targets initiative (SBTi) earlier this year. Actions focus on transitioning our sites to renewable fuel, driving innovation in our design and engaging with our supply chain to drive action.

Our biodiversity strategy, 'Building a Better Habitat' and our circular economy strategy, 'Building Better Circularity' were both published in H1 2024. These set out the actions we will take to manage our impacts, risks, and opportunities with respect to these areas across our value chain.

Underpinning our three strategies is our work with our supply chain which has been ongoing throughout the first half. This involves collaborating and supporting our suppliers to come with us on our sustainability journey. Becoming a founding partner and supporting the Supply Chain Sustainability School in Ireland is a key element of this work.

In July 2024 we were named as the first company in the construction sector in Ireland to be awarded gold accreditation by the Irish Centre for Diversity. This is an important milestone for the business and the industry as we continue implementing our ED&I strategy, 'Building a Better Workplace'.

We are continuing our preparation to report in line with European Sustainability Reporting Standards (ESRS) under the Corporate Sustainability Reporting Directive (CSRD) at year end.

Our ESG ratings remain positive with our Sustainalytics rating at 16.4 ('Low-risk'), our CDP rating at B and our MSCI rating at AA.

• FINANCIAL REVIEW
• Group Performance

Total Group revenue for the first half of the year was €152 million (H1 2023: €172 million). The Group's gross profit for the period was broadly unchanged at €27.7 million (H1 2023: €27.9 million) with an overall expansion in gross margin to 18.2% (H1 2023: 16.3%).

In the Suburban business segment, revenue of €102 million represents a modest decline of 7% versus the H1 2023 outturn. The Group delivered 294 core units in the first half (H1 2023: 333) at an Average Selling Price of approximately €329k (H1 2023: €324k). ASP increased by less than 2% as a result of portfolio mix and house price inflation in the period.

Group gross margin increased by 190bps to 18.2%. The most significant driver was in the Suburban business with a gross margin of 19.7% (H1 2023: 18.7%). The business benefitted from several operational improvements including increased product standardisation, our pricing power in the market and enhanced cost efficiencies from our manufacturing capabilities. We anticipate further progression in the underlying suburban margin to over 20% for FY 2024 as we deliver at increased scale and with a higher percentage of our product from our standardised house types and our manufacturing facilities.

We generated €32 million of revenue from our Partnerships business segment, reflecting significant progress made on both Partnership sites during the period. Given the structure of the Partnership transactions, we recognise revenue and profits on a percentage of completion basis and therefore the revenue and profits recognised in H1 2024 reflect the early stages of construction rather than any units being completed. The Partnership gross margin was 15.1%, consistent with our margin guidance for that business segment.

Our Urban business segment generated revenue of €18 million. This includes the completion of our forward funds in our apartment schemes in Citywest and Castleknock, the revenue from which was primarily recognised in prior reporting periods. Urban gross margin was 15.5% in H1 2024, ahead of the H1 2023 margin of 12.1%.

Group operating profit was €8.6 million (H1 2023: €8.9 million). The Group's administrative costs for the first half were €17.7 million (H1 2023: €17.9 million), which along with €1.4 million (H1 2023: €1.2 million) of depreciation and amortisation gives total administrative expenses of €19.1 million (H1 2023: €19.1 million).

Net finance costs for the period increased modestly to €7.7 million (H1 2023: €7.5 million), primarily impacted by a higher level of average debt during the period to support the growth trajectory of the business.

Overall, the Group delivered Earnings Per Share of 0.12 cent (H1 2023: 0.21 cent).

Balance Sheet and Cash Flow

In H1 2024 the business continued to manage balance sheet efficiency alongside delivery of its growth agenda.

The Property, Plant & Equipment balance of €63.2 million (FY 2023: €64.2 million) decreased modestly, reflecting the completion of our phase of significant investment in our off-site facilities and equipment.

The Group's land investment, excluding development rights, was €411.1 million at 30 June 2024 (31 December 2023: €403.8 million). Development rights decreased from €29.3 million in FY 2023 to €27.9 million in H1 2024 reflecting the utilisation of certain development rights associated with our partnership agreements for Balmoston and Oscar Traynor Road.

To facilitate the significant growth trajectory during FY 2024, the business has invested in work-in progress totalling €441.5 million at 30 June 2024 (FY 2023: €274.6 million). This incremental investment of over €160 million reflects the significant growth across the business in the first half, which will unwind as unit deliveries accelerate in H2. The work-in-progress balance also includes a combined investment of approximately €90 million representing our apartment scheme in Cluain Mhuire (scheduled to complete in FY 2024) and the non-core office development in the Dublin Docklands.

Net assets increased modestly to €681.6 million at 30 June 2024 (FY 2023: €678.2 million). The Group has returned over €300 million to shareholders since the beginning of our first share buyback programme in May 2021 and remains committed to returning surplus cash to shareholders, in line with our capital allocation framework. In this context we are pleased to announce the intention to commence on 6 September 2024 a €50 million share buyback programme.

Reflecting the phasing of investment in work in progress, which has peaked in H1 2024 and will deliver in FY 2024, the Group had an increased net debt position at 30 June 2024 of €244.1 million (FY 2023: €48.8 million). This remains a prudently managed debt level in the context of the overall scale of the business and is expected to fall to below €200m by the end of FY 2024, including the commencement of our share buyback programme and even if all anticipated land acquisitions materialise.

The Group recently finalised a €100 million expansion of its credit facilities with its existing syndicate of lenders. The overall facility now totals €450 million, comprising a €150 million term loan and a €300 million revolving credit facility. The tenure, interest rates and covenants associated with these enlarged facilities are unchanged.

Statement of Directors' responsibilities in respect of the condensed consolidated interim financial statements for the half year ended 30 June 2024

• prepare and present the condensed set of consolidated financial statements in accordance with IAS 34 Interim Financial Reporting as adopted by the EU, and the Transparency Directive and the Transparency Rules of the Central Bank of Ireland;
• ensure the condensed set of consolidated financial statements has adequate disclosures;
• select and apply appropriate accounting policies; and
• make accounting estimates that are reasonable in the circumstances.

We confirm that to the best of our knowledge:

(1) the condensed set of consolidated financial statements included within the half-yearly financial report of Glenveagh Properties plc for the six months ended 30 June 2024 ("the interim financial information") which comprises the condensed consolidated statement of profit or loss and other comprehensive income, the condensed consolidated balance sheet, the condensed consolidated statement of changes in equity, the condensed consolidated statement of cash flows and the related explanatory notes, have been presented and prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the EU, the Transparency Directive and Transparency Rules of the Central Bank of Ireland.

• The interim financial information presented, as required by the Transparency Directive, includes:
• an indication of important events that have occurred during the first 6 months of the financial year, and their impact on the condensed set of consolidated financial statements;
• a description of the principal risks and uncertainties for the remaining 6 months of the financial year
• related parties' transactions that have taken place in the first 6 months of the current financial year and that have materially affected the financial position or the performance of the enterprise during that period; and
• any changes in the related parties' transactions described in the last annual report that could have a material effect on the financial position or performance of the enterprise in the first 6 months of the current financial year.

On behalf of the Board

Stephen Garvey Michael Rice 4 September 2024

Director Director

Independent Review Report to Glenveagh Properties plc ("the Entity")

Conclusion

We have been engaged by the Entity to review the Entity's condensed set of consolidated financial statements in the half-yearly financial report for the six months ended 30 June 2024 which comprises Condensed Consolidated Interim Statement of Financial Position, Condensed Consolidated Interim Statement of Profit or Loss and Other Comprehensive Income, Condensed Consolidated Interim Statement of Changes in Equity, Condensed Consolidated Interim Statement of Cash Flows, a summary of significant accounting policies and other explanatory notes.

Basis for conclusion

Conclusions relating to going concern

Directors' responsibilities

Our responsibility

The purpose of our review work and to whom we owe our responsibilities

KPMG 4 September 2024

Chartered Accountants

1 Stokes Place

Stephen's Green

Dublin, Ireland

Glenveagh Properties PLC

Condensed consolidated statement of profit or loss and other comprehensive income

for the six months ended 30 June 2024

Items that are or may be reclassified subsequently to profit or loss:

for the six months ended 30 June 2024

Glenveagh Properties PLC

Notes to the condensed consolidated interim financial statements

1 Reporting entity

Glenveagh Properties PLC ("the Company") is domiciled in the Republic of Ireland. The Company's registered office is Block C, Maynooth Business Campus, Straffan Road, Maynooth, Co. Kildare. These condensed consolidated interim financial statements comprise the Company and its subsidiaries (together referred to as "the Group") and cover the six month period ended 30 June 2024 ("the period"). The Group's principal activities are the construction and sale of residential houses and apartments for the private buyer, local authorities and institutional investors. The condensed consolidated interim financial statements for the six months ended 30 June 2024 are unaudited and do not constitute statutory financial statements as defined in the Companies Act 2014. A copy of the financial statements for the financial year ended 31 December 2023 are available on the Company's website (https://glenveagh.ie/) and are filed with the Companies Registration Office. The auditor's report accompanying those financial statements was unqualified.

2 Statement of compliance

3 Functional and presentation currency

4 Use of judgements and estimates

In preparing these interim financial statements, management has made judgements and estimates that effect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. No individual judgment or estimate is deemed to have a significant impact upon the financial statements apart from those supporting the assessment of the carrying value of the Group's inventories as described below.

Critical accounting judgements

Management applies the Group's accounting policies when making critical accounting judgements, of which no individual judgement is deemed to have a significant impact upon the financial statements.

Key sources of estimation uncertainty

The Group holds inventories stated at the lower of cost and net realisable value. Such inventories include land and development rights, work-in-progress and completed units. As residential development is largely speculative by nature, not all inventories are covered by forward sales contracts. Furthermore, due to the nature of the Group's activity and, in particular the scale of its developments and the length of the development cycle, the Group has to allocate site-wide development costs between units being built and/or completed in the current year and those for future years. It also has to forecast the costs to complete on such developments. These estimates impact management's assessment of the net realisable value of the Group's inventory balance and also determine the extent of profit or loss that should be recognised in respect of each development in each reporting period.

In making such assessments and allocations, there is a degree of inherent estimation uncertainty. The Group has established internal controls designed to effectively assess and centrally review inventory carrying values and ensure the appropriateness of the estimates made. These assessments and allocations evolve over the life of the development in line with the risk profile, and accordingly the margin recognised reflects these evolving assessments, particularly in relation to the Group's long-term developments. The impact of sustainability and other macroeconomic factors have been considered in the Group's assessment of the carrying value of its inventories at 30 June 2024, particularly with regard to the potential implications for future selling prices, development expenditure and construction programming. Management has considered a number of scenarios on each of its active developments and the consequential impact on future profitability based on current facts and circumstances together with any implications for future projects in undertaking its net realisable value calculations.

5 New significant accounting policies

New and amended standards adopted by the Group

IAS 1 - Classification of Liabilities as Current and Non-Current Liabilities with Covenants

The Group has adopted Classification of Liabilities as Current and Non-Current Liabilities with Covenants - Amendments to IAS1, as issued in 2020 and 2022 became effective in the current reporting period. The amendments apply retrospectively for annual reporting periods beginning on or after 1 January 2024. They clarify certain requirements for determining whether a liability should be classified as current or non-current and require new disclosures for non-current liabilities that are subject to covenants within 12 months after the reporting period. The Group's liabilities were not impacted by the amendments in the current and comparative financial periods.

This amended accounting standard will also apply to the Group's consolidated financial statements as at and for the year ending 31 December 2024 and the effect is not expected to be material.

Standards issued but not yet effective

A number of new standards and amendments to standards are effective for annual periods beginning

after 1 January 2024 and earlier application is permitted. The Group has not early adopted any of the

forthcoming new or amended standards in preparing these condensed consolidated interim financial

statements and do not expect the impact of these to be material.

• IAS 21 The Effects of Changes in Foreign Exchange Rates: Lack of exchangeability (amendment)
• IFRS 10 Consolidated Financial Statements and IAS 28 Investments in Associates and Joint Ventures: Sale or contribution of assets between an investor and its associate or joint venture (amendment)
• IFRS 18 Presentation and Disclosure in Financial Statements (amendment)

There have been no other changes to significant accounting policies during the period to 30 June 2024.

6 Going concern

The Group has recorded a profit before tax of €1.0 million (2023: €1.4 million). The Group has an unrestricted cash balance of €15.7 million (31 December 2023: €46.9 million) exclusive of the minimum cash balance of €25.0 million which the Group is required to maintain under the terms of its debt facilities. The Group has committed undrawn funds available of €68.3 million (31 December 2023: €233.3 million).

Management has prepared a detailed cash flow forecast in order to assess the Group's ability to continue as a going concern for at least a period of twelve months from the signing of these interim financial statements. The preparation of this forecast considered the principal risks facing the Group, including those risks that could threaten the Group's business model, future performance, solvency or liquidity over the forecast period.

The Group is forecasting compliance with all covenant requirements under the current facilities including the interest cover covenant which is based on earnings before interest, tax, depreciation and amortisation (EBITDA) excluding any non-cash impairment charges or reversals. Total debt must not exceed adjusted EBITDA by a maximum of 4 times, this is calculated on both a forward and trailing

twelve-month basis. Other assumptions within the forecast include the Group's expected selling prices and sales strategies as well as its investment in work in progress which reflect updated development programmes.

7 Segmental information

Segmental financial results

As in the prior year, the Group expects significantly more closing activity (and consequently increased revenue) in the second half of the financial year as a result of the seasonality that currently exists within the Group's development cycle.

Core suburban product relates to affordable starter homes for first time buyers. Core urban product relates primarily to apartments suitable for institutional investors. Non-core urban product relates to high-end, private developments and sites. Core suburban and non-core urban revenue is recognised at a point in time. Income from the sale of land amounted to €4.1 million (30 June 2023: €Nil) in the period.

Urban core revenue includes income from the sale of land and development revenue from construction contracts that are recognised over time by reference to the stage of completion of the contract with the customer. Development revenue recognised in the period related to the development of the sites at Barn Oaks Apartments, Castleforbes and Carpenterstown and amounted to €13.3 million (30 June 2023: €58.9 million) with €17.8 million (31 December 2023: €25.5 million) outstanding in contract receivables at the period end. The payment terms for these contracts are between 30 and 90 days. Income from the sale of land amounted to €3.7 million (30 June 2023: €Nil) in the period.

Partnerships revenue includes income from the sale of units recognised at a point in time and development revenue from construction contracts that are recognised over time by reference to the stage of completion of the contract with the customer. Development revenue recognised in the financial period related to the development of the sites at Ballymastone and Oscar Traynor Road and amounted to €32.3 million (30 June 2023: €Nil) with €47.4 million (31 December 2023: €19.3 million) outstanding in contract assets at the year end. No units were sold during the current period.

9 Share-based payment arrangements

Description and reconciliation of options outstanding

The options outstanding at 30 June 2024 had an exercise price €0.001 (2023: €0.001) and a weighted-average contractual life of 7 years (2023: 7 years).

Measurement of fair values

The EPS and ROE related performance conditions are non-market conditions and do not impact the fair value of the EPS or ROE based awards at grant date which is equivalent to the share price at grant date. Awards granted have a three year vesting period. The inputs used in measuring fair value at grant date were as follows:

The exercise price of all options granted under the LTIP to date is €0.001 and all options have a 7- year contractual life.

Expense recognised in profit or loss

The Group recognised an expense of €1.5 million (2023: €1.0 million) in the condensed consolidated statement of profit or loss in respect of options granted under the LTIP and SAYE arrangements.

Global minimum tax

To address concerns about uneven profit distribution and tax contributions of large multinational corporations, various agreements have been reached at a global level, including an agreement by over 135 jurisdictions to introduce a global minimum tax rate of 15%. In December 2022, the Organisation for Economic Co-operation and Development ("OECD") released a draft legislative framework that is expected to be used by individual jurisdictions that signed the agreement to amend their local tax laws. Once changes to the tax laws in any jurisdiction in which the Group operates are enacted or substantively enacted, the Group may be subject to the top-up tax. Currently, the Group operates solely in the Republic of Ireland, based on current criteria there is no current tax impact in the period ended 30 June 2024 (six months ended 30 June 2023: €Nil).

Employment cost capitalised

€12.0 million of employment costs incurred in the period have been capitalised in inventory (June 2023: €7.0 million).

Development rights

Oscar Traynor Road, Coolock, Dublin 5

In December 2022, the Company entered into a Development Agreement ("DA") with Dublin City Council ("DCC"). Under the terms of the DA and following planning permission being granted in February 2023, the Company acquired certain development rights in respect of the site at Oscar Traynor Road, Coolock, Dublin 5 for consideration of approximately €14.0m exclusive of stamp duty and acquisition costs. Under the granted planning permission for the site, the development rights entitle the Company to develop approximately 850 residential units alongside commercial elements in accordance with the terms of the DA.

Ballymastone, Donabate, Dublin

In December 2021, the Company entered into a Development Agreement ("DA") with Fingal County Council ("FCC"). Under the terms of the DA and following planning permission being granted in March 2023, the Company acquired certain development rights in respect of the site at Ballymastone, Donabate, Dublin for consideration of approximately €11.0m exclusive of stamp duty and acquisition costs. The development rights (subject to planning permission) entitle the Company to develop approximately 1,200 residential units in accordance with the terms of the DA.

12 Property, plant and equipment

During the period, the Group recognised total additions to property, plant and equipment of €2.4 million (six months ended 30 June 2023: €11.8 million) which included expenditure on land and buildings of €0.7 million (six months ended 30 June 2023: €8.5 million), with €1.7 million (six months ended 30 June 2023: €3.3 million) invested in plant and machinery, fixtures and fittings and computer equipment. Depreciation recognised in the period was €3.3 million (six months ended 30 June 2023: €2.3 million). Net disposals of plant and machinery in the period of €0.2m (six months ended 30 June 2023: €0.6 million).

During the period, the Group entered into new lease agreements for the use of motor vehicles €0.2 million (six months ended 30 June 2023: €0.2 million).

13 Share capital and share premium

Authorised share capital

Issued and fully paid share capital and share premium

On 6 January 2023, a fourth share buyback programme commenced to repurchase up to 10% of the Group's issued share capital such that the maximum number of shares which can be repurchased under this buyback is 63,813,172. As at 30 June 2023 the total number of shares purchased under the

fourth buyback programme was 60,552,834 at a total cost of €59.3 million. On 2 August 2023, the Group completed the fourth share buyback programme repurchasing 63,813,172 shares for a cost of €62.7 million. All repurchased shares were cancelled.

14 Loans and Borrowings

Loans and borrowings

The Group is party to a five-year sustainability linked finance facility of €350.0 million (Term loan: €116.7m, Revolving Credit Facility: €233.3m), with a syndicate of domestic and international financial institutions, at an interest rate of one-month EURIBOR (subject to a floor of 0 per cent) plus a margin of 2.7-2.8%. The debt facility interest rates are linked to the Group meeting certain sustainability performance targets aligned to its sustainability strategy. The sustainability performance targets are in respect of decarbonisation and the Group's Equity, Diversity and Inclusion strategy. The term loan is repayable in full in February 2028. €281.7 million has been drawn on the debt facility (31 December 2023: €116.7 million). Pursuant to the debt facility agreement, there are fixed and floating charges and assignments in place over all the assets of the Group as continuing security for the discharge of any amounts drawn down. The assets' carrying value at the end of the period is €1,096.5 million (31 December 2023: €935.3 million).

• A maximum total debt to gross asset value ratio of 40%;
• Loans to eligible assets value does not equal or exceed 65%;
• The Group is required to maintain a minimum cash balance of €25.0 million throughout the term of the debt facility;

All covenants have been complied with in the 6-month period and in financial year 2023.

Net funds reconciliation

15 Financial instruments and financial risk management

• Accounting classification and fair value
• Level 1 - Inputs based on quoted prices in active markets for identical assets or liabilities;

The following table presents the Group's estimates of fair value on a recurring basis based on information available at 30 June 2024, aggregated by the level in the fair value hierarchy within which those measurements fall.

Cash and cash equivalents are short-term deposits held at variable rates.

Carrying amount

Other financial liabilities

Trade payables and other current liabilities are non-interest bearing.

*The fair value of the group's loans and borrowings is €278.3m at 30 June 2024 (31 December 2023: 119.6m)

• Financial risk management objectives and policies
• liquidity risk - the risk that suitable funding for the Group's activities may not be available;
• market risk - the risk that changes in market prices, such as interest rates will affect the Group's income or the value of its holdings of financial instruments; and
• credit risk - the risk that a counter-party will default on their contractual obligations resulting in a financial loss to the Group.

Liquidity risk

The Group is party to a five-year sustainability linked finance facility of €350.0 million with a syndicate of domestic and international financial institutions, at an interest rate of one-month EURIBOR (subject to a floor of 0 per cent) plus a margin of 2.7-2.8%. The debt facility interest rates are linked to the Group meeting certain sustainability performance targets aligned to its sustainability strategy. The sustainability performance targets are in respect of decarbonisation and the Group's Equity, Diversity and Inclusion strategy. €281.7 million has been drawn on the debt facility (31 December 2023: €116.7 million). The Group has an exposure to cash flow interest rate risk where there are changes in the EURIBOR rates.

*Includes €25.0 million (31 December 2023: €25.0 million) of restricted cash.

The Group's RCF is subject to the following primary financial covenants on a bi-annual basis:

• A maximum total debt to gross asset value ratio of 40%;
• Loans to eligible assets value does not equal or exceed 65%;
• The Group is required to maintain a minimum cash balance of €25.0 million throughout the term of the debt facility;

Market risk

Interest rate risk reflects the Group's exposure to changes in interest rates and stems predominantly from its debt obligations. Interest rate risk reflects the Group's exposure to fluctuations in interest rates in the market. This risk arises from bank loans that are drawn under the Group's debt facilities with variable interest rates based upon EURIBOR. At the period ended 30 June 2024 it is estimated that an decrease of 100 basis points to EURIBOR would have increased the Group's profit before tax by

€1.1 million (2023: decrease of €1.1 million) assuming all other variables remain constant, and the rate change is only applied to the loans that are exposed to movements in EURIBOR.

As part of the Group's strategy to manage our interest rate risk, the Group entered into an interest rate swap on 28 February 2023 to hedge the interest rate risk associated with the €100.0 million term loan element of our new debt facilities. The interest rate swap is in place for the 5-year period of the facility agreement. The nominal amount hedged for years one and two is €100.0 million with this stepping down to €50.0 million for the remaining three years of the facility agreement.

Interest rate risk

The Group held the following instruments to hedge exposures to changes in interest rates.

The amounts at the reporting date relating to items designated as hedged items were as follows:

As at 30 June 2024

Change in

value used for

Credit risk

The Group's exposure to credit risk encompasses the financial assets being: trade and receivables,

contract assets and cash and cash equivalents. Credit risk is managed by regularly monitoring the Group's credit exposure to each counter-party to ensure credit quality of customers and financial institutions in line with internal limits approved by the Board.

16 Commitments and contingent liabilities

Hollystown Golf and Leisure Limited ("HGL")

Contracted acquisitions

At 30 June 2024, the Group had contracted to acquire development sites; one in County Galway, one in County Meath and one in County Cork for an aggregate consideration of approximately €11.8 million (excluding stamp duty and legal fees). Deposits totalling €2.6 million were paid pre-period end and are included within trade and other receivables at 30 June 2024.

17 Subsequent events

In August 2024, the Group finalised an expansion of the existing sustainability linked finance facility to €450.0m (Term Loan: €150.0m, Revolving Credit Facility €300.0m) with the existing syndicate of domestic and international financial institutions. All other terms and conditions agreed at the commencement of the facility remain the same as at the commencement in February 2023.

A third Partnerships contract with revenue of approx. €50 million for a site adjacent to our Balmoston site is now signed, with construction anticipated to begin by year end.

18 Goodwill

No indicator of impairment existed at reporting date in respect of goodwill.

19 Related party transactions

There were no related party transactions in the current or prior reporting period.

20 Approved condensed consolidated interim financial statements

The Directors approved the condensed consolidated interim financial statements on 4 September 2024.