Winton's pre-sale strategy delivers in difficult market

WINTON’S PRE-SALE STRATEGY DELIVERS IN DIFFICULT MARKET

Winton (NZX: WIN / ASX: WTN) is pleased to release its full-year results for the period ending 30 June 2024 (FY24) with revenue of $173.6 million, earnings before interest, tax, depreciation and amortisation (EBITDA) of $29.5 million and profit after tax of $15.7 million.

During FY24, Winton’s longstanding pre-sale strategy served it well with 345 settlements. These were skewed slightly to the second half, with 187 units settled, compared to 158 units in the first half of FY24. This compares to 565 units in FY23, where the development and construction project timeline led to an exceptional year of delivery.

Chris Meehan, Chair and CEO of Winton said: “The financial results don’t capture the resilience and progress that Winton made during FY24. Despite a difficult market and very challenging economic conditions, we have continued to deliver pre-sold properties, complete new projects and diversify our revenue streams. This steadfastness is a testament to Winton’s commitment and ability to weather market fluctuations.”

“Even with a slow market and challenging economic conditions, Winton finished the year with a landbank yield of c6,000 units, cash holdings of $41.7 million and a solid pre-sale book that has increased in the weeks after the end of the financial year to $411.7 million as at 23 August 2024.”

Similar to the decline reported in the half-year FY24 results, earnings before interest, tax, depreciation and amortisation (EBITDA) of $29.5 million and profit after tax of $15.7 million were down 69.1% from $95.6 million and 75.6% from $64.6 million respectively in FY23. The decrease is attributable to the lower number of settlements, higher cost of sales per unit from a higher percentage of built product, a $1.7 million fair value loss in FY24 compared to a $6.8 million gain in FY23, higher administration expenses from the establishment and operation of Ayrburn, and an abnormal one-off tax adjustment associated with a change in tax deductibility. This was slightly offset by lower selling expenses from selling fewer units, higher interest income, and lower current and deferred tax as a result of the above.

As previously communicated, a $80.0 million debt facility was established, secured only against the Lakeside development, to fund Winton’s wider growth plans. As at 30 June 2024, the drawn-down balance was $64.8 million. Winton has no recourse debt at group level and all other properties across the group remain unencumbered.

A core part of Winton is unlocking land value for masterplanned neighbourhoods and development projects. In FY24, Winton continued the momentum with value-creating outcomes on a number of projects. The plan change for Stage 18 at Northlake was approved unlocking a total of 125 lots, and rezoning has been approved to enable 7 prestigious residential lots at Ayrburn. In addition, resource consent was granted for Northbrook Arrowtown including the adjacent boutique hotel. Resource consent was also granted for Northbrook Launch Bay.

In December, Winton opened the multi-venue Ayrburn hospitality precinct in Arrowtown, which was an incredible undertaking by the development team to deliver spectacular venues, while maintaining and celebrating the heritage of their original purpose as farm buildings. The Ayrburn masterplan has been designed to uplift the value of neighbouring Northbrook Arrowtown and Winton-owned residential land. The response to date has been exceptional with approximately 150,000 visiting Ayrburn since opening and it is expected to increase year on year.

Northbrook now has three locations registered under the Retirement Villages Act 2003 and full-scale Display Suites – Northbrook Wynyard Quarter, Northbrook Wanaka and Northbrook Arrowtown.

Construction of Northbrook Wanaka has continued at pace in preparation for Stage One completion in May 2025. At Northbrook Wynyard Quarter, piling and basement construction was delayed from February 2024 due to industry-wide issues around structural engineering and the Auckland Council consenting process, which required changing structural engineers. Practical completion remains on schedule, with an anticipated occupation date for residents of FY28.

The Board has paused paying a dividend to maintain financial discipline through softer market conditions while enabling Winton to continue executing its growth plans. Therefore, the total dividend for FY24 was 0.55 cents per share reflecting the dividend paid for the six months ending 31 December 2023.

Chris Meehan concludes: “Property development is cyclical, and Winton’s experience gives us confidence that we are playing the cycle as best we can, and we are well prepared to weather continued challenging conditions until it does turn around. We know this won’t be the case for other industry players or an enticing time for new entrants to enter the industry. Our job is to continue to progress with discipline and to set Winton up well for when the market becomes more buoyant.

We remain cautious about the market conditions for the year ahead and will continue to operate with discipline. There is a lot to look forward to, and we are grateful to continue sharing Winton’s success with its partners, contractors, service suppliers, shareholders and employees.”

Winton’s Annual Report is also released today with the Company’s FY24 results, which contain important information related to the company’s governance, financial commentary, Northbrook, Ayrburn, Cracker Bay and ESG.

Winton’s Annual Report and all future financial reports will be publicly available on our website Investor Centre (https://investors.winton.nz/investor-centre/). Investors may at any time, request a hard copy (or an electronic copy) of the most recent and future Annual Reports free of charge. You can do so through our share registry, Link Market Services, including by updating your communication preferences online through the Investor Centre.

Ends.

For investor or analyst queries, please contact:
Jean McMahon, CFO
+64 9 869 2271
[email protected]

For media queries, please contact:
Sonya Fynmore
+64 21 404 206
[email protected]

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Announcement PDF