Commento di Alain Dinin, Chairman e CEO di Nexity
Since the start of the year, and especially in the second quarter, the French residential real estate market has been in a particularly tough situation. Household purchasing power has continued to decline, a host of complex regulations have been introduced (notably under the newly enacted ALUR Act) and, most importantly, buyer sentiment has suffered. All of those factors have combined to slow the – already historically low – rate of new homes entering the market for sale, whether to investors or would-be homeowners. According to French Housing Ministry statistics, the number of new home starts in the 12 months to end-May 2014 was down 9% year on year. If this trend continues, France is looking at housing production levels of 300,000 new homes per year at best. With that in mind, Nexity is pleased to confirm its full-year target announced in early 2014, of about 10,000 net reservations (no change from 2013). However, we now believe that the French market on the whole will go down this year rather than stay flat. On 25 June 2014, Prime Minister Manuel Valls, realising the gravity of the problems plaguing construction in France, announced a first series of initiatives which, if implemented swiftly, could help stem the market’s decline in the final months of this year. The government’s efforts should also have a positive impact in the medium term, assuming they are part of a larger and more proactive plan – which is the only way to rebuild confidence among investors and home buyers. With a total of 4,537 net reservations in the first half of 2014, a 2.2% year-on-year increase, Nexity has demonstrated its resilience in a depressed market. We accomplished this thanks to a wide and diverse array of products, spot-on price positioning, sales clout, and our strong franchise with professional landlords, who accounted for 38% of Nexity’s net reservations in residential real estate. The drop in revenue and operating profit in the first half of 2014 was expected. It does not adversely impact the targets shared with the market earlier this year, which Nexity fully stands by. Nexity’s operating margin (6.6%) remained stable overall compared to the first half of 2013, driven by strong financial performances in Residential as well as Commercial real estate, and Services and Distribution Networks, where margins have begun trending towards target levels. Another highlight of early 2014 was the completion of two major acquisitions (Oralia and PERL) which will help accelerate Nexity’s profitable growth.