Inmobiliaria del Sur S A : Results Presentation

FY 2020

Results Presentation

26th February 2021

	Legal Notice
This presentation is the exclusive property of INMOBILIARIA DEL SUR. S.A. (INSUR). Its total or partial reproduction is strictly
	prohibited and it is covered by current law. Offenders will legally prosecuted both in Spain and abroad. The use, copy,
	reproduction or sale of this publication may only be undertaken with the explicit authorization in writing by INSUR. This
	document has been drawn‐up by INSUR, exclusively for use in the presentation of results of the Grupo Consolidado
	Inmobiliaria del Sur S.A. corresponding to the FY 2020 Results.
	This document is purely informative and does not constitute an acquisition, exchange or sales offer, nor an invitation to form
	a purchase offer on securities issued by the Company. Except for financial information included in this document (which has
	been taken from the FY 2020 Consolidated Accounts of Inmobiliaria del Sur S.A. the document contains statements on
	intentions, expectations and future prospects. All declarations, except those based on past data, are future declarations,
	including those regarding our financial position, business strategy, management plans and objectives for future operations.
	These intentions, prospects or forecasts are subject, as such, to risks and uncertainties which may determine that what
	actually occurs does not correspond to them. These risks include the evolution and competition of the real estate sector,
	preferences and expenditure and investment trends of consumers and their access to credit, economic, financing and legal
	conditions, plus others. The risks and uncertainties that could possibly affect information provided are difficult to predict.
	The information included in this document has not been checked or revised by INSUR auditors. The Company assumes no
	obligation to revise or publicly update these declarations in the event of changes or unforeseen events that may affect them.
	The Company provides information on them and other factors that may affect future declarations, the business and financial
	results of INSUR Group, in the documents presented before the Spanish National Stock Exchange Commission. Anyone
	interested is invited to consult these documents.
	INSUR, its subsidiaries or other companies of the group or companies in which INSUR has an interest, will not be held
	responsible, regardless of whether negligence of any other circumstance is involved, for damage or loss that may arise from
	the improper use of this document or its contents.

2

• Rationale behind the use of the proportionate method

Grupo INSUR (Insur) , whose parent company is Inmobiliaria del Sur, S.A., develops two main activities, housing development and rental.

The rental activity is carried out by Insur Patrimonial, S.L.U. (IPAT), fully owned by Insur, as well as by other companies which are also fully owned by IPA (except for IDS Madrid Manzanares, S.A. where Insur has a 90% stake)

The housing development activity is conducted through a company fully owned by Insur, Insur Promoción Integral, S.L.U., (IPI), which in turn holds shares in different companies. In order to increase the activity and also to diversify the risks, a significant part of this business is carried out through joint ventures in companies where Grupo Insur has a significant stake (usually 50%). With a view of increasing the quality of the houses, obtaining better customization options and a stricter control on the works, the Group develops the construction activity both for its fully owned developments and for the JV´s. This instrumental activity is carried out by IDS Construcción y Desarrollos, S.A.U, which is fully owned by IPI.

As the Group does not have the control over the JVs, in the sense that it cannot decide unilaterally the financial and activity policies, but it shares these decisions with the rest of the partners, these JVs are consolidated by the equity method as stablished in the IFRS 11. Accordingly, the consolidated financial statements do not include the proportional part of the Group in the assets, liabilities, incomes and expenditures of such JVs. The Group is fully involved in the management of these JVs which consolidate by the equity method, not just because it holds at least the 50% of the equity, but because it carries the operating management based on the management, construction and marketing contracts undersigned, as these JVs lack from human and material resources.

Therefore, since the activities of these companies are monitored internally on a proportional basis, based on the percentage of ownership in each one, the Parent's directors consider that for a better understanding and analysis of its consolidated business and, above all, of the true magnitude of its activities, the volume of assets managed and the size of its financial and human resources, it is more appropriate to present this information using the proportional consolidation method

At the end of this presentation can be found a conciliation between the financial statements consolidated by both methods.

3

Executive Summary. FY 2020 Highlights

Figures by proportionate method

M€ = Million Euros

.8 M€	.5 M€	.3 M€	.1 M€
+8.2%	‐8.0%	+47.1%	+138.6%
Revenues	Adjusted EBITDA*	EBIT	Net Profit

Homebuilding	98.0 M€	+50.7%
Rental	13.3 M€	‐3.0%
Construction	18.5 M€	‐53.2%
Asset management	3.0 M€	‐33.0%
Net Financial Debt	208.9M€	+6.3%

* Does not have into account assets turnover, excluding stock impairments

• Great number of deliveries; the homebuilding branch has delivered units amounting 161.3 M€ (98.0 M€ adjusted by the stake % in the JV) during the year.
• Good commercial performance, despite the extraordinary and unprecedent situation caused by the pandemic. Total presales totaled 86.2 M€ (52.6 M€ adjusted by the stake % in the JV). At the end of the year presales stayed at 121.7 M€ (75.7 M€ adjusted by the stake % in the JV), which shows the capacity to generate results in the incoming years.
• Resiliency of the asset management branch, which has only dropped by 3%, despite the Covid‐19 restrictions and the impact in car parks.
• Great investor effort in asset management; to highlight the termination and delivery of Madrid Río 55 Business Park and investment capex to reconvert and renovate rental buildings.
• Strengthening of the financial structure; important reduction of the short‐term debt. Capacity to finance working capital through new emissions at MARF.

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Executive Summary. FY 2020 Results

M€

All figures by proportionate method

+8.2%

122.8	132.8	+50.7%
					98.0
					65.1					‐53.2%
								‐3.0%		39.6		‐33.0%
							13.7	13.3	18.5	4.5	3.0
			R e v e n u e s		H o u s e b u i l d i n g		R e n t a l s		C o n s t r u c t i o n		A s s e t
													M a n a g em ent
M€				+47.1%
							+155.3%
			‐24.6%	+8.0%			35.3
								+138.6%
26.1							29.4
	24.5	24.0
				19.7	22.7								21.1

11.5

8.8

E B I T D A

A d j u s t e d E B I T D A * O p e r a t i n g P r o f i t

P B T

N e t P r o f i t

* Does not have into account assets turnover, excluding stock impairments

REVENUE BREAKDOWN

Housebuilding	Rentals
Construction	Asset Management
	2%

14%

2019

10%

2020

74%

PRESALES	OCCUPANCY RATE
100% Owned and JVs in their participation %
M€

	2019	121.1	75.7	88.4%	89.4%
	2020	2019	2020	2019	2020
		‐37.5%	+1p.p.	5