Wrap Text
Unaudited condensed consolidated interim financial results for the six months ended 31 August 2024
CALGRO M3 HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 2005/027663/06)
JSE Share code: CGR
ISIN: ZAE000109203
Company Alpha Code: CGRI1
LEI: 3789003B0859E9438F25
("Calgro M3" or "the Group" or "the Company")
UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL RESULTS FOR THE SIX
MONTHS ENDED 31 AUGUST 2024
1. SALIENT FEATURES
- Earnings per share ("EPS") increased to 101.40 cents per share (August 2023: 78.88 cents per
share)
- Headline earnings per share ("HEPS") increased to 101.40 cents per share (August 2023: 78.88
cents per share)
- Revenue decreased by 26.40% to R507.0 million (2023: R668.9 million)
- 869 residential units handed over
- 1 539 residential units under construction
- Net asset value ("NAV") increased by 6.92% to R14.29 per share (February 2024: R13.37 per
share)
- Cash increased by 37.73% to R168.9 million (February 2024: R122.6 million)
- Net debt to equity stable at 0.63 (February 2024: 0.63)
- No dividend was declared for the period ended 31 August 2024 (2023: Nil)
Residential Property Development
A decrease in revenue for the period under review was primarily driven by reduced unit sales due
to pressure on the already constrained consumer, and delayed transfers. The Group, however,
banked over R200 million in cash during the first two weeks of September. During the period, 869
units (August 2023: 1 193 units), were handed over, while 1 539 units are under construction, with
the majority expected to be completed by the end of February 2025. We intend to commence with
a further 1 592 units shortly that are targeted for completion in the next financial year. The Group
currently has a further 2 609 serviced opportunities available that are ready for top structure
construction to commence and a further 2 416 currently being serviced.
The growth in gross margin, to 29.69%, reflects the strategic move to a higher mix of open market
and non-public sector units as well as the project and product mix, which now benefits from historic
land and infrastructure costs. Additionally, while the number of units handed over was slightly lower
than the previous period, the positive product mix and lower infrastructure costs offset this
reduction, leading to an improved gross profit margin. The margin is expected to remain above the
target for the short to medium-term. To service the lower, high-demand end of the unhoused
market, Calgro M3's national average sales price for our core two-bedroom family apartment
during the period was R636 617, excluding VAT.
Memorial Parks
The Memorial Parks segment grew revenue to R31.7 million. This business accounts for 6.26% of
Group revenue. The segment's main goal remains cash generation for the Group. In line with this,
cash generation has shown remarkable resilience and growth, with cash receipts increasing by
52.8% to R52.1 million. The growth in reservations, particularly through the lay-by option, indicates
consumer preference for flexible payment options in the current environment.
The lay-by sales offering grew by R14.7 million during the period and currently has an active book
of R40.7 million, which will convert to revenue when sales are fully settled. The gross profit margin
remains robust at 57.08%, a testament to effective cost management and operational efficiency.
2. OUTLOOK
As we move into the second half of 2024, Calgro M3 is poised for a transformative growth phase.
Our robust pipeline, consisting of strategic large-scale developments Fleurhof, South Hills,
Bankenveld and Belhar, combined with the trading out of other developments, positions us to
deliver a future pipeline in excess of 38 000 units. These projects do not only represent financial
returns, they also represent our continued commitment to addressing South Africa's housing needs
and the offering of value-for-money homes that transform lives and communities.
Our focus in the coming months is twofold: to accelerate the transfer of completed units, drive
sales for sustainable growth to enable the Group to roll out the pipeline over an approximate 15
year period, and ensure efficient execution and cash flow conversion. We will continue refining
operational efficiencies across all segments, driving both profitability and value for shareholders
and stakeholders. By capitalising on our strong financial foundation, we are safeguarding short-
term stability and ensuring long-term resilience in an economic environment where we believe the
consumer will remain under pressure for some time to come, even if interest rates start decreasing.
The Memorial Parks segment, which has already shown robust growth, will be another key
expansion area. We intend to bring our high-quality, dignified burial solutions to new provinces,
meeting growing demand and extending our reach to more communities. With cash generation at
the forefront, this segment's ability to provide lasting value will continue to be a focus, underpinned
by our unique offering of flexible, dignified burial options.
3. SHORT-FORM ANNOUNCEMENT
This short-form announcement is the responsibility of the directors of Calgro M3. It contains only
a summary of the information in the unaudited condensed consolidated interim financial results for
the six months ended 31 August 2024 ("Interim Results") and does not contain full or complete
details.
The Interim Results can be found on the Company's website at
https://www.calgrom3.com/index.php/investors/annual-reports or on the JSE cloudlink at
https://senspdf.jse.co.za/documents/2024/JSE/ISSE/CGRE/HY2025.pdf.
Any investment decision by investors and/or shareholders should be based on consideration of the
Interim Results, as a whole. This short-form announcement and the Interim Results, from which
the information was extracted, have not been audited or reviewed by the Company's auditors.
By order of the Board
Wikus Lategan Sayuri Naicker
Chief Executive Officer Group Financial Director
Johannesburg
14 October 2024
Equity and Debt Sponsor
PSG Capital
Date: 14-10-2024 07:05:00
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