INLAND HOMES INTERIM RESULTS PRESENTATION Period ending 31 December 2017 March 2018
Half-year highlights ▪ Growth in housebuilding operations continues ▪ Significant progress being made on partnership pipeline ▪ Strong forward sales position of £38.9m supported by government initiatives ▪ Land bank up 6.3% to 7,372 plots in the period ▪ Revenue* up 26% Y/Y driven by plot and unit sales ▪ Adjusted EPRA NAV per share +1.5% to 97.63p in the period ▪ Interim dividend +30% to 0.65p * Revenue includes value of land sold via a corporate disposal Tiptree, Essex March 2018 2 Inland Homes PLC - Interim Results 2017
A strategy focused on growth Target Maximise Growth specific value sites ▪ Increase size of land bank ▪ Focus on South and South East ▪ Secure valuable planning permissions ▪ Diversify portfolio with increased number of ▪ Allow 12-24 months to secure planning ▪ Capture profits from land sales, speculative ▪ T sites arget challenging and complex brownfield development and partnership housing ▪ Add value through planning and development sites – 100% success rate on planning ▪ Sites with short-term income generation to drive EPRA NAV per share preferable 3 Inland Homes PLC - Interim Results 2017 March 2018
Returns on land dependent on level of risk Greenfield Brownfield ▪ T ▪ Challenging sites, e.g environmental and ecological issues arget local authorities without 5 year land supply ▪ Control sites by way of options with minimal up front payment ▪ Well located sites with good transport links ▪ Planning process includes zoning component ▪ Allow 12-24 months to secure planning ▪ Allow 2-5 years to secure planning ▪ Preferred sites of 100-400 plots ▪ Exercise price at a discount to market value, typically 20% ▪ Sites with initial income generation preferred, e.g. short-term leases ▪ T ▪ ASP of homes approximately £300k otal investment at period end of £7m Illustrative returns on brownfield and greenfield land Return On Capital Employed Initial Risk Capital Unallocated Allocated Unallocated Allocated Brownfield Brownfield Greenfield Greenfield Inland Homes PLC - Interim Results 2017 4 March 2018
South and South-East focused portfolio Status of land bank Under construction 8% Other Strategic sites 55% 37% T otal land bank split by type Flats Houses 57% 43% 5 Inland Homes PLC - Interim Results 2017 March 2018
Balanced and growing pipeline Land Portfolio Unit completion timescale Plots without planning permission Plots with planning permission < 24 Months 8% 8,000 7,000 6,000 5,000 4,000 2 - 5 Years 3,000 33% 2,000 > 5 Years 1,000 59% 0 Total Group Total Group Total Group share share share 2015 2016 2017 6 Inland Homes PLC - Interim Results 2017 March 2018
Lower risk partnership housing to balance business model ▪ Cash received upfront on disposal of land with profit realised ▪ Steady cash income stream over development period ▪ Lower development margin but with lower risk ▪ Forward orders secured ▪ No sales, marketing and funding costs ▪ No construction finance required ▪ Housing market risk avoided ▪ Currently, three partnership projects in progress with further three under negotiation ▪ T arget order book this calendar year £100m Whitley Gardens, Southall 7 March 2018 Inland Homes PLC - Interim Results 2017
Sites in the pipeline Wilton Park, Beaconsfield Cheshunt Lakeside, Hertfordshire Appletree Farm, Cressing • Outline planning submitted for 350 homes • Outline planning submitted by Inland for • Inland controls this 13.5 acre site within and commercial within a parkland setting the 31 acre site comprising 1,853 the green belt via an option • Delivery of relief road is significant of apartment-led mixed use development • The site has been identified by Braintree • Regeneration includes new local plaza, which first phase has been constructed District Council in their emerging Local • Estimated gross development value of senior accommodation, office, retail, Plan for residential development leisure and a two form entry primary • Two detailed planning applications will £350m school • Potential for further residential and shortly be submitted for 65 apartments and • Inland has a 50% interest in 18 acres of 88 houses commercial as included in Local Authority’s Preferred option list the site upon which 1,317 apartments are located • Ability to buy out JV partner 8 Inland Homes PLC - Interim Results 2017 March 2018
Developments under construction Lily’s Walk, High Wycombe Witley Gardens, Southall Chapel Riverside, Southampton • Former gas works, 3.5 acres site with • Former one acre industrial site adjacent to • Development Agreement with planning for 239 residential units and the Grand Union Canal Southampton City Council over 9 acres of 16,000 sq ft of commercial • Planning secured for 57 apartments water fronted brownfield site • Highly contaminated brownfield site • Planning secured for 457 residential • Land sold to Registered Provider for £6m • One and two bedroom apartments with apartments and 60,000 sq ft of commercial with a construction contract for £10.5m • Complex site which involves a major prices ranging from £250k to £350k • Construction 46% complete • Forward sales of £5.5m archeological dig, sea defences and • Build margin 17% relocation of settlement tanks • Gross development value of £75m • Gross development value of £49m • HCA funding agreed for the development 9 Inland Homes PLC - Interim Results 2017 March 2018
Private housebuilding in progress H1 2017 H1 2016 Change % Open Outlets 9 6 50.0 Net reservation rate 0.81 0.58 28.4 Private reservations (homes) 141 64 120.3 Forward order book (£m) 38.9 31.8 18.9 Private completions (homes) 96 87 10.3 Private ASP (£'000) 322 319 0.9 Affordable completions (homes) 34 14 142.9 10 Inland Homes PLC - Interim Results 2017 March 2018
Stable market environment ▪ Continuing to see good demand for properties under £400k ▪ Strong net reservation rate in 2018 at an average of 1.0 unit per active site ▪ Pricing remains firm, supported by the strong reservation rate ▪ Partnership housing market is robust with ongoing discussions on a number of sites ▪ Strong appetite from housebuilders and RP’s for consented land St John’s, Chelmsford 11 Inland Homes PLC - Interim Results 2017 March 2018
Financial summary H1 2017 H1 2016 Change % Revenue (£m) 61.2 48.6* 26.0 Profit before Tax (£m) 5.4 5.0 8.5 Diluted EPS 2.08p 1.78p 16.9 Dividend 0.65p 0.5p 30.0 EPRA NAV per share 97.63p 92.34p 5.7 Gearing 51.8% 66.1% EPRA Gearing 35.6% 42.0% * Includes value of land sold via a corporate disposal 12 March 2018 Inland Homes PLC - Interim Results 2017
Income statement H1 2017 H1 2016 Change % £m £m Revenue 61.2 48.6* 25.9 Cost of sales (49.8) (35.7) 39.5 Gross profit 11.4 12.9 -11.6 Administrative expenses (5.0) (4.1) 22.0 Operating profit 6.4 8.8 -27.3 Net finance cost (1.6) (3.6) -55.6 Profit before tax and share of profits from associates and JVs 4.8 5.2 -7.7 Share of profit of associates and JVs 0.6 (0.2) Profit before tax 5.4 5.0 8.0 *Includes value of land via a corporate disposal 13 Inland Homes PLC - Interim Results 2017 March 2018
Revenue analysis 70 60 50 40 30 20 10 0 Dec 2017 Revenue Dec 2017 Gross profit Dec 2016 Revenue* Dec 2016 Gross profit* -10 Land sales Housebuilding Contract income Rental income Other * Revenue and gross profit includes value of land sold via a corporate disposal 14 Inland Homes PLC - Interim Results 2017 March 2018
Balance sheet H1 2017 H1 2016 Change % Investment properties (£m) 53.6 52.1 2.9 Investment in associate and JVs (£m) 27.8 24.7 12.6 Stock and WIP (£m) 137.1 148.1 -7.4 Land debtors (£m) 16.8 10.0 68.0 Land creditors (£m) -23.8 -22.1 7.7 Other (£m) -6.9 -15.8 -56.3 Net borrowings (£m) -69.9 -78.4 -10.8 Net assets (£m) 134.7 118.6 13.6 Adjusted EPRA NAV (£m) 196.3 186.5 5.3 Adjusted EPRA NAV per share (p) 97.63 92.34 5.7 15 Inland Homes PLC - Interim Results 2017 March 2018
Debt liquidity Debt maturity as at 31 December 2017 40 35 30 25 £ m 20 15 10 5 0 2018 2019 2020 2021 2022 16 Inland Homes PLC - Interim Results 2017 March 2018
Movement in NAV EPRA NAV £m 200 4.4 199 198 197 196.3 196 (2.3) (0.2) 195 194.4 194 193 192 191 190 Jun 17 Profit for period Change in Other Dec 17 unrealised profit 17 Inland Homes PLC - Interim Results 2017 March 2018
Summary and outlook ▪ Residential market for core operating areas remains strong ▪ Transformation into volume private and partnership housebuilding on track ▪ Cross-party political environment remains supportive to housebuilding and to increase housing numbers 18 March 2018 Inland Homes PLC - Interim Results 2017
Appendices Church Road, Ashford 19 Inland Homes PLC - Interim Results 2017 March 2018
Key metrics as at 31 December Note. 2016 Revenue includes value of land sold via a corporate disposal 20 March 2018 Inland Homes PLC - Interim Results 2017
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