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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.

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Presentation on theme: "PREZENTACJA J.W.CONSTRUCTION HOLDING S.A. PERFORMANCE IN Q1 2009 PREZENTACJA J.W.CONSTRUCTION HOLDING S.A. PERFORMANCE IN Q1 2009."— Presentation transcript:

1 PREZENTACJA J.W.CONSTRUCTION HOLDING S.A. PERFORMANCE IN Q PREZENTACJA J.W.CONSTRUCTION HOLDING S.A. PERFORMANCE IN Q1 2009

2 2 CHANGE IN ACCOUNTING POLICY3 CHANGES IN ACCOUNTING POLICY – OUTCOMES4 PERFORMANCE IN Q Q GROSS SALES PROFIT 7 STRATEGY OF J.W. CONSTRUCTION HOLDING S.A.8 STRATEGY - DIVERSIFYING OPERATIONAL RISK OF THE GROUP9 STRATEGY- APARTMENTS READY TO MOVE IN16 STRATEGY- PROJECTS IN THE PIPELINE17 IMPLEMENTED PROJECTS – OVERVIEW18 INDUSTRY DEVELOPMENT PROSPECTS IN THE COMPANYS VIEW24 THE COMPANYS SALES POLICY IN PRESENTATION PERFORMANCE IN Q PRESENTATION AGENDA

3 CHANGE 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

4 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

5 data – restated to IAS 18 In Q1 2009, sales increased by 90.6% from the same period last year PRESENTATION PERFORMANCE IN Q PERFORMANCE IN Q1 2009

6 6 Operating profit rose by 179% in Q year on year In addition, net profit in Q posted a 204% increase as compared with Q PRESENTATION PERFORMANCE IN Q PERFORMANCE IN Q data – restated to IAS 18

7 Q 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 8 STRATEGY OF J.W. CONSTRUCTION HOLDING S.A. Regardless of circumstances, the Company diversifies the Groups 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 9 PRESENTATION PERFORMANCE IN Q STRATEGY - DIVERSIFYING 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 10 PRESENTATION PERFORMANCE IN Q 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 - DIVERSIFYING OPERATIONAL RISK OF THE GROUP

11 11 PRESENTATION PERFORMANCE IN Q 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 - DIVERSIFYING OPERATIONAL RISK OF THE GROUP

12 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 Point Warszawa, 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 - DIVERSIFYING OPERATIONAL RISK OF THE GROUP PRESENTATION PERFORMANCE IN Q1 2009

13 Office Building - Nowa Dana Szczecin, 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 - DIVERSIFYING OPERATIONAL RISK OF THE GROUP Office and Commercial Space PRESENTATION PERFORMANCE IN Q1 2009

14 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 - DIVERSIFYING OPERATIONAL RISK OF THE GROUP PRESENTATION PERFORMANCE IN Q1 2009

15 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 - DIVERSIFYING OPERATIONAL RISK OF THE GROUP Hotel Operations PRESENTATION PERFORMANCE IN Q1 2009

16 STRATEGY- APARTMENTS 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 17 PRESENTATION PERFORMANCE IN Q STRATEGY- PROJECTS 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 / DISTRICT MARKET SEGMENT NO. OF APARTMENTS / HOUSES ESTIMATED USABLE APARTMENT FLOOR SPACE, SQ. M Zielona Dolina I, Zdziarska/Ostródzka Streets Warsaw / Białołęka Standard apartments 633 * Lewandów Park III, Lewandów StreetWarsaw / Białołęka Standard apartments Zielona Dolina II, Zdziarska/Ostródzka Streets Warsaw / Białołęka Standard apartments ŚwiatowidaWarsaw / Białołęka Standard apartments Szczecin, Wyzwolenia AvenueSzczecinLuxury apartments/ services Badylarska – Office BuildingWarsawServices Pileckiego – Offices / HotelWarsawServices/ Hotel services BerensonaWarsaw / BiałołękaStandard apartments * Apartments available for sale – construction work to start in the middle of 2009

18 Górczewska Park II Warsaw, Górczewska/ Olbrachta Streets The Górczewska Park project includes 12 apartment buildings situated at Górczewska/Olbrachta Streets apartments and 4 commercial premises. Project Usable apartment floor space (sq. m) Revenue (PLN thousand) Górczewska Park Warsaw Market IMPLEMENTED PROJECTS - OVERVIEW PRESENTATION PERFORMANCE IN Q1 2009

19 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. Project Usable apartment floor space (sq. m) Revenue (PLN thousand) Lewandów Park Warsaw Market IMPLEMENTED PROJECTS - OVERVIEW PRESENTATION PERFORMANCE IN Q1 2009

20 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. Project Usable apartment floor space (sq. m) Revenue (PLN thousand) Osiedle Bursztynowe Warsaw Market IMPLEMENTED PROJECTS - OVERVIEW PRESENTATION PERFORMANCE IN Q1 2009

21 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. Project Usable apartment floor space (sq. m) Revenue (PLN thousand) Wiślana Aleja Warsaw Market IMPLEMENTED PROJECTS - OVERVIEW PRESENTATION PERFORMANCE IN Q1 2009

22 Ludwinowska Aleja II Warsaw, Ludwinowska Street Six cosy semi-detached houses with 24 apartments. Project Usable apartment floor space (sq. m) Revenue (PLN thousand) Ludwinowska Aleja II Warsaw Market IMPLEMENTED PROJECTS - OVERVIEW PRESENTATION PERFORMANCE IN Q1 2009

23 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. Project Usable apartment floor space (sq. m) Revenue (PLN thousand) Osada Wiślana Warsaw Market IMPLEMENTED PROJECTS - OVERVIEW PRESENTATION PERFORMANCE IN Q1 2009

24 24 PRESENTATION PERFORMANCE IN Q INDUSTRY DEVELOPMENT PROSPECTS IN THE COMPANYS 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 Polands probable entry into the euro area

25 25 PRESENTATION PERFORMANCE IN Q THE COMPANYS 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

26 INVESTOR RELATIONS OFFICE: Małgorzata Szwarc-Sroka Head of Financial Liquidity Management and Head of the Investor Relations Office Phone: / or


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