Mr. Iain Stewart reports
GENESIS REPORTS 2023 SECOND QUARTER RESULTS
Genesis Land Development Corp. has released its financial and operating results for the three months (Q2) and six months ended June 30, 2023 (YTD).
Herein are highlights of Genesis financial results for the first half of 2023.
2023 highlights (Q2 2023 and YTD 2023):
Progress on business plan:
During 2023, Genesis has continued to execute its growth business plan. Genesis achieved some significant milestones in 2022, with the removal of growth management overlays (GMOs) and in 2023, with receiving final development approvals enabling Genesis to proceed with development of the comapny's Lewiston and Logan Landing communities in 2023. Subsequent to June 30, 2023, Genesis received outline plan and land use approval from the City of Calgary for the 157 acres it acquired in Q2 2022, in the Belvedere ASP. Final approvals required prior to commencement of site servicing activity are expected to be received this fall. More growth is coming through expansion of its home building division. Genesis has contracted to purchase 505 lots through third party developers. In all, Genesis is now building homes in nine communities which provides additional growth opportunities.
- $90.5-million of revenues in YTD 2023:
Genesis generated revenue of $90.5-million in YTD 2023 up from $42.6-million achieved in YTD 2022. Q2 2023 revenues of $53.2-million were higher when compared with $22.2-million generated in Q2 2022.
Net earnings in YTD 2023 were $4.3-million:
Net earnings attributable to equity shareholders in YTD 2023 were $4.3-million (seven cents of net earnings per share -- basic and diluted), compared with net loss attributable to equity shareholders of $400,000 (one cent loss per share -- basic and diluted) in YTD 2022. Net earnings attributable to equity shareholders in Q2 2023 were $4.1-million ((seven cents of net earnings per share -- basic and diluted), compared with net earnings attributable to equity shareholders of $10,000 (zero cents of earnings per share -- basic and diluted) in Q2 2022.
166 lots sold:
In YTD 2023, Genesis sold 166 residential lots (75 to third party builders and 91 through its home building division, GBG), an increase of 196 per cent from 56 lots in YTD 2022 (six to third party builders and 50 through GBG). In Q2 2023, Genesis sold 104 residential lots (45 to third party builders and 59 through GBG), an increase of 333 per cent from 24 lots in Q2 2022 (two to third party builders and 22 through GBG).
129 homes sold: In YTD 2023, Genesis sold 129 homes, an increase of 93 per cent from the 67 sold in YTD 2022. In Q2 2023, Genesis sold 69 homes, an increase of 92 per cent from the 36 sold in Q2 2022.
132 new home orders in Q2 2023:
During Q2 2023, Genesis had 132 new home orders compared with 23 for Q2 2022. New home orders for the six months ended June 30, 2023, were 156 units compared with 198 units for the same period in 2022. As of June 30, 2023, Genesis had 232 outstanding new home orders, compared with 272 as at June 30, 2022.
Cash on hand of $40.2-million:
On June 30, 2023, Genesis had $40.2-million in cash and cash equivalents and loan and credit facilities of $60.1-million which is 15 per cent of the total book value of assets.
Supported by a solid financial position, a backlog of new-home orders and the strength of Calgary's economy, Genesis continues to add growth opportunities in both its land and housing divisions. Housing price increases in recent years, rapidly increasing interest rates, inflationary pressures, tight labour markets and continuing supply chain constraints are impacting new home orders, and home affordability. These negative factors are being offset by strong housing demand from newcomers to Alberta, the continued historic low supply of homes for sale in the tight Calgary market and the growing economy.
The Calgary Real Estate Board is forecasting an overall reduction in home sales in 2023 in Calgary, to 25,921 units, down from a record high in 2022 of 29,672 units. The Royal Bank of Canada forecasts Alberta GDP (gross domestic product) to grow by 2.4 per cent in 2023, which is the strongest in Canada but a marked deceleration from the 5.1-per-cent growth in 2022. Immigration to both Alberta and the CMA continues to be strong into 2023 as evidenced by the 4-per-cent growth in the working age population in the CMA to the end of June, 2023, as compared with June, 2022. In addition to strong international immigration, people are moving to the CMA from across Canada, with the biggest net inflows coming from the two provinces with the most unaffordable housing markets: Ontario and British Columbia. However, continued mixed economic indicators and general economic uncertainty, lead Genesis to remain cautious in planning and executing its strategic and business plans.
The information contained in this press release should be read in conjunction with the unaudited condensed consolidated interim financial statements for the three and six months ended June 30, 2023, and 2022 and the related management's discussion and analysis (MD&A) dated July 27, 2023, which have been filed with Canadian securities regulatory authorities. Copies of these documents may be obtained via SEDAR+ or the company's website.
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