Dear fellow shareholders,
In FY 2023/24, we met all our business and financial targets, created considerable value for our shareholders and stakeholders and cemented our position as the leading player in the Spanish residential development market.
Earnings-wise, we are reporting €1.15 billion of revenue, year-on-year growth of almost 25%, EBITDA of €173 million and a net profit of €109 million.
We ended the year in a position of financial strength: our net debt of €310 million implies a net debt-to-EBITDA ratio of 1.8x and an LTV ratio of 16.3%.
True to our disciplined approach to land investment, we invested over €220 million in new sites where we expect to develop 2,500+ homes, locking in our ability to meet our production and delivery targets for the years to come. That leaves us with a land bank with a development capacity of 14,000+ homes across Spain’s most dynamic housing markets.
Although the economic and geopolitical remained uncertain, the Spanish economy was very strong last year, emerging as one of the eurozone’s growth engines. Despite the rate increases ushered in by the change in monetary policy direction, the residential market proved highly resilient, marked by rising prices and steady demand. The gap between supply—limited by a scarcity of ready-to-build land—and growing demand, coupled with good household savings levels, points to healthy prospects for the years ahead.
AEDAS Homes once again proved itself a predictable and reliable company, thanks to a business model that produces sustained and sustainable growth, as borne out by earnings per share of €2.53 and a return on equity of 11.7% in FY 2023/24. The philosophy behind that model is one of decentralised and scalable management and an unwavering commitment to innovation, underpinned by a highly experienced, qualified team of professionals.
In FY 2023/24 our activity was concentrated in the Build-to-Sell line (sale of housing to individuals), targeted at households in the mid to upper income brackets, who have a strong appetite for the houses we build. In tandem, we continued to develop Build-to-Rent housing (turnkey sale of developments designed for the rental market to institutional investors).
Last year we saw significant growth in our asset-light Real Estate Services division, which provides value-added services to institutional investors and family offices who see AEDAS Homes as a trusted industrial partner for their residential development investments and leverage our track record, market knowledge and management capabilities. Over the course of the year, we closed two co-investment transactions valued at close to €300 million of equity, while remaining committed to developing affordable housing via public-private partnerships.
For the first time, AEDAS Homes has surpassed one billion in revenue and has achieved its business plan goals six years in a row
In the Build-to-Sell segment, we delivered 2,456 units at an ASP of €358,000 euros last year, generating revenue of €879 million (up 13.8% year-on-year). And in the Build-to-Rent segment, we delivered 383 units at an ASP of €184,000 euros, adding a further €71 million to our topline. The blended gross development margin in the two segments was 23.4%.
Elsewhere, the Real Estate Services division delivered 99 units and generated revenue from the provision of services of €9 million (up 84.9% year-on-year), at a gross margin of 32.5%.
At 31 March 2024, the company had 9,800 active units: 2,200 at the design phase, 1,500 at the marketing phase, 5,000 under construction and the remaining 1,100 already complete. That implies high coverage of our sales targets for FY 2024/25 (67%) and FY 2025/26 (37%) and leaves us confident in our ability to continue to deliver our targets in the coming years.
AEDAS Homes is leading the transformation of the sector into a modern, efficient, competitive and sustainable industry. That transformation will mean shorter delivery times, lower costs, higher product quality and safer construction processes. It also lessens the impact on the environment and generates higher returns for our shareholders and other stakeholders.
In this quest to transform the sector, we are spearheading the large-scale use of Modern Methods of Construction, which include factory-built components such as façades, bathroom pods, structures and stairways, as well as alternative materials such as cross-laminated timber. Offsite solutions like these are allowing us to deliver our homes within the timeframes promised to our customers despite significant endemic problems such as a shortage of qualified labour in the construction sector.
In FY 2023/24, we also continued the fine-tuning of our hyperconnected Developer Operating System, which is ready for the advent of generative AI. This system, which provides end-to-end digitalisation of our design, planning and execution processes, integrates the network of professionals and suppliers we work with and allows us to automate and synchronise data and critical business processes in real time, changing the way the real estate sector operates and optimising the use of our resources.
AEDAS Homes is committed to acting responsibly along the environmental, social and governance dimensions. We are working to create a better future to make our cities more sustainable and enrich the communities where we build homes. As such, we are aligned with the United Nations 2030 Agenda and the effort to tackle climate change, as set down in the targets embedded into our new ESG Strategic Plan 2024-2026.
We have met the environmental targets we set ourselves, which include carrying out Life Cycle Assessments on all our developments and ensuring that 100% of our development carry our Ecoliving® or another recognised seal. I am proud to say that 62% of the developments we completed last year boast an AA energy rating. To take this further, we have continued to sign agreements with suppliers of more environmentally-friendly materials such as sustainable concrete and 100%-recycled aluminium at our developments.
AEDAS Homes’ greatest asset is, unquestionably, its human capital. In addition to achieving the results and advances outlined here, our employees are determined to improve our impact on society. They participate in 30 charitable projects and sporting and cultural event sponsorships across our business communities and support young local artists through our #ConLasArtes by AEDAS Homes programme.
We want to play an active role in solving the social problem created by the shortage of housing and are working with the authorities on affordable housing development initiatives such as Plan Vive in Madrid. Under that plan, we are already managing the construction of 3,600 affordable rental homes and we plan to break ground on 700 additional units in the next few months.
I encourage you to read on for a more detailed account of these last 12 months of innovation, partnerships and shared value creation.
Many thanks,
Santiago Fernández Valbuena
