- FINANCIAL REPORT
Consolidated financial statements at 31 December 2023
5.1 CONSOLIDATED FINANCIAL STATEMENTS AT 31 DECEMBER 2023
5.1.1 Condensed consolidated financial statements
5.1.2 Notes to the consolidated financial statements
Note 1 Information on the Company and significant developments
Note 2 General principles
Note 3 Scope of reporting and business combinations Note 4 Recognition of revenue and operating profit Note 5 Alternative performance indicators
Note 6 Segment information
ANALYSIS OF THE FINANCIAL STATEMENTS
Note 7 | Goodwill |
Note 8 | Rightટofટuse assets, other property, plant, |
equipment and intangible assets | |
Note 9 | Equityટaccounted investments |
Note 10 | Other financial assets |
WORKING CAPITAL REQUIREMENT
Note 11 Breakdown of working capital requirement Note 12 Inventories and work in progress
Note 13 Trade and other receivables Note 14 Other current assets Note 15 Other current liabilities
EQUITY
Note 16 Share capital
Note 17 Nonટcontrolling interests
Note 18 Free share award plans
Note 19 Treasury shares held
247 | DEBT AND FINANCIAL RISK FACTORS | 273 | |
Note 20 Breakdown of net debt | 273 | ||
252 | Note 21 | Borrowings and financial liabilities | 274 |
Note 22 | Other financial receivables | 278 | |
252 | Note 23 | Cash and cash equivalents | 278 |
253 | Note 24 | Financial risk factors | 278 |
254 Note 25 Fair value of financial instruments
257 | by accounting category | 280 | |
258 | PROVISIONS | 282 | |
258 | Note 26 Current and nonટcurrent provisions | 282 | |
265 | INCOME | 284 | |
265 | Note 27 Employee benefits expense | 284 | |
266 | Note 28 Other operating expenses | 285 | |
Note 29 Depreciation, amortisation and impairment | |||
267 | 285 | ||
of nonટcurrent assets | |||
268 | Note 30 Net financial income/(expense) | 285 | |
269 | Note 31 | Taxes | 286 |
269 | Note 32 Earnings per share | 288 | |
269 | ADDITIONAL INFORMATION | 289 | |
269 | Note 33 Offટbalance sheet commitments | 289 | |
270 | Note 34 Statutory Auditors' fees | 291 | |
270 | Note 35 Information on related parties | 291 | |
271 | Note 36 Events after the reporting period | 292 | |
271 | Note 37 Main consolidated companies | ||
at 31 December 2023 | 292 | ||
271 | |||
271 | 5.1.3 | Statutory Auditors' report | 294 |
272 | on the consolidated financial statements |
246 / Nexity / UNIVERSAL REGISTRATION DOCUMENT 2023
FINANCIAL REPORT
Consolidated financial statements at 31 December 2023
5.1.1 Condensed consolidated financial statements
Consolidated balance sheet
ASSETS | |||||||||||
Balance at | |||||||||||
Balance at | |||||||||||
(in thousands of euros) | Notes | 31/12/2022 | |||||||||
31/12/2023 | |||||||||||
Nonટcurrent assets | |||||||||||
Goodwill | 7 | 1,171,893 | 1,397,735 | ||||||||
Other intangible assets | 8 | 107,153 | 147,596 | ||||||||
Rightટofટuse assets | 8 | 748,343 | 715,798 | ||||||||
Property, plant and equipment | 8 | 81,505 | 80,484 | ||||||||
Equityટaccounted investments | 9 | 132,795 | 109,326 | 5 | |||||||
Other financial assets | 10 | 49,713 | 60,201 | ||||||||
Deferred tax assets | 31 | 25,342 | 15,899 | ||||||||
Total non current assets | 2,527,039 | ||||||||||
2,316,744 | |||||||||||
Current assets | |||||||||||
Inventories and work in progress | 12 | 1,909,849 | 1,973,399 | ||||||||
Trade and other receivables | 13 | 1,163,205 | 1,541,735 | ||||||||
Tax receivable | 31 | 16,138 | 10,400 | ||||||||
Other current assets | 14 | 700,453 | 1,653,293 | ||||||||
Other financial receivables | 22 | 370,296 | 361,118 | ||||||||
Cash and cash equivalents | 23 | 715,947 | 897,979 | ||||||||
Total current assets | 6,437,924 | ||||||||||
4,875,888 | |||||||||||
Assets held for sale | 3.2 | 1,303,942 | 209,700 | ||||||||
TOTAL ASSETS | 8,496,574 | 9,174,663 |
Nexity / UNIVERSAL REGISTRATION DOCUMENT 2023 / 247
5 | FINANCIAL REPORT | |||||||||
Consolidated financial statements at 31 December 2023 | ||||||||||
LIABILITIES AND EQUITY | ||||||||||
Balance at | ||||||||||
Balance at | ||||||||||
(in thousands of euros) | 31/12/2022 | |||||||||
31/12/2023 | ||||||||||
Equity | ||||||||||
Share capital | 16 | 280,649 | 280,649 | |||||||
Additional paidટin capital | 521,060 | 521,060 | ||||||||
Treasury shares held | 19 | (16,633) | (21,652) | |||||||
Reserves and retained earnings | 1,073,184 | 1,006,267 | ||||||||
Net profit for the period | 19,206 | 187,770 | ||||||||
Equity attributable to equity holders of the parent company | 1,974,094 | |||||||||
1,877,466 | ||||||||||
Nonટcontrolling interests | 17 | 63,380 | 61,629 | |||||||
Total equity | 2,035,723 | |||||||||
1,940,846 | ||||||||||
Nonટcurrent liabilities | ||||||||||
Longટterm borrowings and financial debt | 21 | 581,780 | 665,481 | |||||||
Nonટcurrent lease liabilities | 21 | 719,731 | 672,222 | |||||||
Employee benefits | 26 | 10,928 | 20,815 | |||||||
Deferred tax liabilities | 31 | 80,137 | 98,921 | |||||||
Total non current liabilities | 1,457,439 | |||||||||
1,392,576 | ||||||||||
Current liabilities | ||||||||||
Shortટterm borrowings, financial liabilities and operating liabilities | 21 | 1,161,677 | 1,227,563 | |||||||
Current lease liabilities | 21 | 128,770 | 106,812 | |||||||
Current provisions | 26 | 68,735 | 76,999 | |||||||
Trade and other payables | 1,750,992 | 1,816,277 | ||||||||
Current tax liabilities | 31 | 4,693 | 21,263 | |||||||
Other current liabilities | 15 | 890,033 | 2,267,852 | |||||||
Total current liabilities | 5,516,766 | |||||||||
4,004,900 | ||||||||||
Liabilities associated with assets held for sale | 3.2 | 1,158,252 | 164,735 | |||||||
TOTAL LIABILITIES AND EQUITY | 8,496,574 | 9,174,663 |
248 / Nexity / UNIVERSAL REGISTRATION DOCUMENT 2023
FINANCIAL REPORT
Consolidated financial statements at 31 December 2023
Consolidated income statement
31/12/2023 | 31/12/2022 | ||||||||||||
(in thousands of euros) | Notes | (12 month period) | |||||||||||
(12 | month period) | ||||||||||||
Revenue | 4 | 3,964,311 | 4,351,751 | ||||||||||
Purchases | (2,605,277) | (2,883,564) | |||||||||||
Employee benefits expense | 27 | (664,045) | (671,481) | ||||||||||
Other operating expenses | 28 | (283,409) | (256,252) | ||||||||||
Taxes (other than income tax) | (35,657) | (33,275) | |||||||||||
Depreciation, amortisation and impairment of nonટcurrent assets | 29 | (197,427) | (172,019) | ||||||||||
Current operating profit | 335,160 | ||||||||||||
178,496 | |||||||||||||
Nonટcurrent operating profit | 39,624 | - | |||||||||||
Operating profit | 335,160 | ||||||||||||
218,120 | |||||||||||||
Share of net profit of equityટaccounted investments | 9 | 18,570 | 25,730 | 5 | |||||||||
Operating profit after share of net profit of equityટaccounted investments | 360,890 | ||||||||||||
236,690 | |||||||||||||
Financial expenses | 30 | (116,047) | (67,817) | ||||||||||
Financial income | 30 | 15,954 | 7,244 | ||||||||||
Net financial income/(expense) | (60,573) | ||||||||||||
(100,093) | |||||||||||||
Pre tax recurring profit | 300,317 | ||||||||||||
136,597 | |||||||||||||
Income tax | 31 | (50,780) | (88,770) | ||||||||||
Share of net profit/(loss) from other equityટaccounted investments | 9 | (49,086) | (7,441) | ||||||||||
NET PROFIT | 36,731 | 204,106 | |||||||||||
o/w: Attributable to equity holders of the parent company | 19,206 | 187,770 | |||||||||||
o/w: Attributable to nonટcontrolling interests | 17,525 | 16,336 | |||||||||||
(in euros) | |||||||||||||
Net earnings per share | 32 | 0.35 | 3.40 | ||||||||||
Diluted earnings per share | 32 | 0.33 | 2.98 |
Consolidated statement of comprehensive income
31/12/2023 | 31/12/2022 | |||||||
(in thousands of euros) | (12 month period) | |||||||
(12 | month period) | |||||||
NET PROFIT | 36,731 | 204,106 | ||||||
Change in value of derivative instruments for hedging | (2,656) | - | ||||||
Foreign currency translation gains and losses | 2,703 | (433) | ||||||
Gains and losses that may be recycled to net profit | 47 | (433) | ||||||
Actuarial gains and losses on retirement benefits | 2,150 | 3,870 | ||||||
Deferred tax on actuarial gains and losses | (555) | (999) | ||||||
Other variations | - | 106 | ||||||
Gains and losses that may not be recycled to net profit | 2,977 | |||||||
1,595 | ||||||||
TOTAL OTHER COMPREHENSIVE INCOME (NET OF TAX) | 1,642 | 2,544 | ||||||
TOTAL COMPREHENSIVE INCOME | 38,373 | 206,650 | ||||||
o/w: Attributable to equity holders of the parent company | 20,848 | 190,314 | ||||||
o/w: Attributable to nonટcontrolling interests | 17,525 | 16,336 |
Nexity / UNIVERSAL REGISTRATION DOCUMENT 2023 / 249
- FINANCIAL REPORT
Consolidated financial statements at 31 December 2023
Change in consolidated equity
Reserves | Other | Equity attributable | |||||||||||||||
Additional | Treasury | to equity holders | Non- | ||||||||||||||
Share | paid in | shares | and retained | comprehensive | of the parent | controlling | Total | ||||||||||
(in thousands of euros) | capital | capital | held | earnings | income | company | interests | equity | |||||||||
Movements in 2022 | |||||||||||||||||
At 1 January 2022 | 280,649 | 548,489 | (34,066) | 1,128,484 | 4,996 | 1,928,552 | 19,620 1,948,172 | ||||||||||
Treasury shares | 12,414 | (9,594) | 2,820 | 2,820 | |||||||||||||
Shareટbased payments | 11,773 | 11,773 | 11,773 | ||||||||||||||
Impact of acquisitions or disposals | |||||||||||||||||
of nonટcontrolling interests after | |||||||||||||||||
acquisition of control | (20,585) | (20,585) | (20,585) | ||||||||||||||
Dividends paid by Nexity | |||||||||||||||||
(€2.50 per share) | (138,100) | (138,100) | (138,100) | ||||||||||||||
Total movements linked | |||||||||||||||||
to relationships | |||||||||||||||||
with shareholders | 12,414 | (156,506) | - | (144,092) | - (144,092) | ||||||||||||
Net profit for the period | 187,770 | 187,770 | 16,336 | 204,106 | |||||||||||||
Other comprehensive income | 2,544 | 2,544 | 2,544 | ||||||||||||||
Total comprehensive income | 187,770 | 2,544 | 190,314 | 16,336 | 206,650 | ||||||||||||
Dividends paid by subsidiaries | - | (9,960) | (9,960) | ||||||||||||||
Impact of changes in scope | (680) | (680) | 35,633 | 34,953 | |||||||||||||
AT 31 DECEMBER 2022 | 280,649 | 548,489 | (21,652) | 1,159,068 | 7,540 | 1,974,094 | 61,629 | 2,035,723 | |||||||||
Movements in 2023 | |||||||||||||||||
At 1 January 2023 | 280,649 | 548,489 | (21,652) | 1,159,068 | 7,540 | 1,974,094 | 61,629 2,035,723 | ||||||||||
Treasury shares | 5,019 | (9,488) | (4,469) | (4,469) | |||||||||||||
Shareટbased payments | 2,032 | 2,032 | 2,032 | ||||||||||||||
Impact of acquisitions or disposals | |||||||||||||||||
of nonટcontrolling interests after | |||||||||||||||||
acquisition of control | 25,066 | 25,066 | 25,066 | ||||||||||||||
Dividends paid by Nexity | |||||||||||||||||
(€2.50 per share) | (139,241) | (139,241) | (139,241) | ||||||||||||||
Total movements linked to | |||||||||||||||||
relationships | |||||||||||||||||
with shareholders | 5,019 | (121,631) | (116,612) | (116,612) | |||||||||||||
Net profit for the period | 19,206 | 19,206 | 17,525 | 36,731 | |||||||||||||
Other comprehensive income | 1,642 | 1,642 | 1,642 | ||||||||||||||
Total comprehensive income | 19,206 | 1,642 | 20,848 | 17,525 | 38,373 | ||||||||||||
Dividends paid by subsidiaries | - | (15,898) | (15,898) | ||||||||||||||
Impact of changes in scope | (864) | (864) | 124 | (740) | |||||||||||||
AT 31 DECEMBER 2023 | 280,649 | 548,489 | 1,055,779 | 9,182 | 1,877,466 | 63,380 | 1,940,846 | ||||||||||
(16,633) |
250 / Nexity / UNIVERSAL REGISTRATION DOCUMENT 2023
FINANCIAL REPORT
Consolidated financial statements at 31 December 2023
Consolidated statement of cash flows
31/12/2023 | 31/12/2022 | |||||||||||||||||||
(in thousands of euros) | Notes | (12 month period) | ||||||||||||||||||
(12 | month period) | |||||||||||||||||||
Net profit attributable to equity holders of the parent company | 19,206 | 187,770 | ||||||||||||||||||
Net profit attributable to nonટcontrolling interests | 17,525 | 16,336 | ||||||||||||||||||
Consolidated net profit | 204,106 | |||||||||||||||||||
36,731 | ||||||||||||||||||||
Elimination of nonટcash income and expenses: | ||||||||||||||||||||
Elimination of depreciation, amortisation and provisions | 53,557 | 36,700 | ||||||||||||||||||
Elimination of depreciation of rightટofટuse assets | 155,534 | 134,366 | ||||||||||||||||||
Elimination of gains and losses on asset disposals | (58,830) | 547 | ||||||||||||||||||
Elimination of the impact of changes in fair value | - | - | ||||||||||||||||||
Elimination of net profit from equityટaccounted investments | (18,570) | (25,730) | ||||||||||||||||||
Elimination of net profit from other equityટaccounted investments | 49,086 | 7,441 | 5 | |||||||||||||||||
Elimination of the impact of shareટbased payments | 2,032 | 11,773 | ||||||||||||||||||
Cash flow from operating activities after interest and tax expenses | 369,203 | |||||||||||||||||||
219,540 | ||||||||||||||||||||
Elimination of net interest expense/(income) | 78,786 | 50,350 | ||||||||||||||||||
Elimination of tax expense, including deferred taxes and tax credits | 49,507 | 87,465 | ||||||||||||||||||
Cash flow from operating activities before interest and tax expenses | 507,018 | |||||||||||||||||||
347,833 | ||||||||||||||||||||
Change in operating working capital | 11 | 213 | (186,717) | |||||||||||||||||
Dividends received from equityટaccounted investments | 9 | 26,089 | 36,644 | |||||||||||||||||
Interest paid | (44,233) | (20,952) | ||||||||||||||||||
Tax paid | (91,056) | (66,759) | ||||||||||||||||||
Net cash from/(used in) operating activities | 269,234 | |||||||||||||||||||
238,846 | ||||||||||||||||||||
Purchase of subsidiaries, net of cash acquired | 3.4 | (6,763) | (23,446) | |||||||||||||||||
Proceeds from sale of subsidiaries, net of cash divested | 3.5 | 134,820 | 1,274 | |||||||||||||||||
Other changes in scope | (1,059) | 245 | ||||||||||||||||||
Reclassification in accordance with IFRS 5 | 3.2 | (14,852) | (45,395) | |||||||||||||||||
Purchase of property, plant, equipment and intangible assets | (59,738) | (69,135) | ||||||||||||||||||
Purchase of financial assets | (52,837) | (10,381) | ||||||||||||||||||
Proceeds from sale of property, plant, equipment and intangible assets | 617 | 325 | ||||||||||||||||||
Proceeds from sale and redemption of financial assets | 6,896 | 4,146 | ||||||||||||||||||
Net cash from/(used in) investing activities | (142,367) | |||||||||||||||||||
7,084 | ||||||||||||||||||||
Dividends paid to equity holders of the parent company | (139,241) | (138,100) | ||||||||||||||||||
Dividends paid to minority shareholders of consolidated companies | (15,898) | (9,960) | ||||||||||||||||||
Net disposal/(acquisition) of treasury shares | (7,065) | 639 | ||||||||||||||||||
(Acquisitions)/disposals of nonટcontrolling interests with no gain or loss of control | (114,642) | (46,329) | ||||||||||||||||||
Proceeds from issuance of bonds | 181,189 | 188,264 | ||||||||||||||||||
Redemption of bonds | (245,503) | (98,517) | ||||||||||||||||||
Repayment of lease liabilities | (143,144) | (132,786) | ||||||||||||||||||
Decrease in receivables and increase in shortટterm financial debt | 27,678 | (71,349) | ||||||||||||||||||
Net cash from/(used in) financing activities | (308,138) | |||||||||||||||||||
(456,626) | ||||||||||||||||||||
Impact of changes in foreign currency exchange rates | (113) | 188 | ||||||||||||||||||
CHANGE IN CASH AND CASH EQUIVALENTS | (181,083) | |||||||||||||||||||
(210,809) | ||||||||||||||||||||
Cash and cash equivalents at beginning of period | 861,316 | 1,042,399 | ||||||||||||||||||
Cash and cash equivalents at end of period | 23 | 650,507 | 861,316 |
Nexity / UNIVERSAL REGISTRATION DOCUMENT 2023 / 251
- FINANCIAL REPORT
Consolidated financial statements at 31 December 2023
5.1.2 Notes to the consolidated financial statements
Note 1 Information on the Company and significant developments
1.1 Presentation
Nexity is a global real estate operator harnessing the entire spectrum of property knowટhow and skills to serve private individuals, companies, institutional investors and local authorities. Covering all segments of the real estate development and services markets, Nexity is one of the top players in French real estate and offers its clients a unique range of expertise and advice, products, services and solutions to meet their evolving needs.
The Group is present throughout France, with some limited operations elsewhere in Europe.
It is organised around the following three business divisions:
- The Development division, which includes the following activities:
- Residential real estate development, including the development of new homes and subdivisions in France, urban regeneration and, to a lesser extent, development in other European countries, and
- Commercial real estate development, corresponding to the development of office buildings, business parks, logistics platforms, shops and hotels;
- The Services division including:
- Property management (property management and transactions for individuals and companies);
- Serviced properties (management of student residences and coworking spaces);
- Distribution (marketing of real estate products); and
- The Other activities division, which includes investment activities and the holding company.
Nexity's shares are listed on Eurolist by NYSE Euronext Paris.
1.2 Significant developments
The 2023 fiscal year was marked by the following events:
Business activity - Nexity outperforms the market
- New home reservations: -19% in volume in a market down by 26% yearટonટyear and by 41% over two years; and
- Continued strong growth in serviced real estate with revenue up 25%.
A busy 2023 to refocus the Group's roadmap
- Pivot towards urban regeneration:
- first market deal with Carrefour and creation of the property venture, jointly owned by Carrefour (80%) and Nexity (20%). This is classified under equityટaccounted investments. The revenue expected at completion on property development activities thanks to this partnership will be in excess of €2 billion over 10 years, and
- launch of Nexity Héritage, a property development brand specialising in urban regeneration, and partnership with Mirabaud AM to develop property venture operations.
- Disposal of international activities:
- Disposal of activities in Poland and Portugal.
- Strategic and financial partnerships:
-
In December 2023, Nexity entered into exclusive negotiations to sell its Services to Individuals business to Bridgepoint for an enterprise value of
€440 million. The transaction is expected to close in the 1st half of 2024. In this respect, assets and liabilities of discontinued operations are presented on specific lines of the assets and liabilities of the consolidated statement of financial position under the headings "Assets held for sale" and "Liabilities held for sale" in accordance with IFRS 5 Operations held for disposal (Note 3.2.3).
-
In December 2023, Nexity entered into exclusive negotiations to sell its Services to Individuals business to Bridgepoint for an enterprise value of
252 / Nexity / UNIVERSAL REGISTRATION DOCUMENT 2023
GENERAL INFORMATION
Note 2 General principles
2.1 Statement of compliance
The consolidated financial statements of Nexity group as at 31 December 2023 are prepared in accordance with IFRS (International Financial Reporting Standards) and the interpretations and decisions of the IFRS IC (IFRS Interpretations Committee) as adopted in the European Union.
The accounting policies and principles applied to the consolidated financial statements at 31 December 2023 are identical to those used for the consolidated financial statements for fiscal year ended 31 December 2022, except for the points described in 2.2.
FINANCIAL REPORT
Consolidated financial statements at 31 December 2023
The Company's press releases and annual reports - including historical financial information about the Company and the consolidated financial statements - are available on the Company's website www.nexity.fr/en/ group. Copies may also be obtained from Nexity's registered office at 19, rue de Vienne - TSA 50029 - 75801 Paris Cedex 8 (France).
The consolidated financial statements were approved | by | 5 |
the Board of Directors on 28 February 2024 and will | be |
submitted for approval at the Shareholders' Meeting of 23 May 2024.
2.2 New IFRS IC standards, interpretations and decisions
Pillar 2 or GloBE rules (finance law December 2023)
The aim of the "Global AntiટBase Erosion Rules" ("GloBE Rules" or "Pillar 2") is to ensure that groups of companies with revenue of at least €750 million are taxed at an effective rate of 15%.
To this end, these groups must determine, in each jurisdiction in which they operate, their effective GloBE tax rate and, if this is lower than the minimum rate, pay an additional tax.
No deferred tax in respect of Pillar 2 is recognised in the Group's financial statements at 31 December 2023 as a result of the application of the mandatory temporary
exemption introduced by the amendment to IAS 12 (published by the IASB on 23 May 2023, adopted by the EU on 8 November 2023) and applicable for accounting periods beginning on or after 1 January 2023.
In order to be as well prepared as possible for compliance with the new Pillar 2 obligations, the Group has followed OECD publications and legislative developments in the jurisdictions in which it operates. At this stage of our work, we consider that no significant additional tax cost is expected.
The other standards, amendments and interpretations adopted by the European Union in 2023 had no impact on the financial statements.
2.3 Estimates and assumptions
In the process of preparing the consolidated financial statements, the measurement of certain statement of financial position and income statement items calls for the use of assumptions or assessments based, in particular, on budgets for real estate projects. These are used to measure the operating margin, nonટcurrent assets, provisions, inventory impairment and accrued expenses, as well as the assets held for sale and the associated liabilities. Other items also require the use of estimates based on assumptions regarding business plans, or changes in the rates applied, and include provisions, goodwill, and put options granted to minority shareholders.
These assumptions, estimates or assessments are established and reviewed regularly on the basis of information available and the actual position of the Company on the date the financial statements are prepared, taking into consideration past experience and other relevant factors. Actual results may differ significantly from estimates due to changes in the underlying conditions and assumptions.
The assumptions, estimates and assessments used to prepare the financial statements for the year ended 31 December 2023 were made in the context of the real estate market crisis (sharp rise in interest rates impacting the purchasing power of real estate buyers, the announced end of the Pinel scheme, the scarcity of land, and changes of commercial property usage, etc.).
Nevertheless, in the medium term, basic housing needs in France will support demand and the Group's activity.
In addition, the Group's financial statements include the identified effects of issues and risks related to climate change. Given its activities, ESG (environmental, social and governance) issues are an essential part of Nexity group's growth and are factored into its financial decisions.
The Group is developing an ambitious strategy for a lowટcarbon, resilient city, helping to speed up the environmental transition in the real estate sector.
Nexity / UNIVERSAL REGISTRATION DOCUMENT 2023 / 253
-
FINANCIAL REPORT
Consolidated financial statements at 31 December 2023
These commitments are reflected in the financial statements by:
- Including the costs of complying with certain building design and construction criteria into the real estate development programme budgets;
Using methods to measure goodwill that rely on projected target margins for operations, including the costs described above; and
- Including a carbon footprint reduction criterion in variable remuneration targets for executives and free share plans.
Taking climate risk into account did not represent an issue for the managerial estimates made for the preparation of the financial statements.
2.4 Reporting date
Group companies are consolidated on the basis of their financial statements for the period ended 31 December 2023.
Note 3 Scope of reporting and business combinations
3.1 Consolidation and reporting
Subsidiaries
Subsidiaries are entities controlled by the Group. Control exists when the Group has power over the entity, has rights to variable returns from its involvement with the entity, and has the ability to affect those returns through its power over the entity.
In assessing control, potential voting rights that the Group is able in practice to exercise are taken into account.
The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases.
Associates and joint ventures
Associates are entities in which the Group has significant influence, but not control, over financial and operating policies.
Joint ventures are entities over whose activities the Group has joint control, established by contractual agreement. Most joint ventures are real estate development programmes (residential or commercial) undertaken with another developer (joint ventures).
The consolidated financial statements include the Group share of the total recognised gains and losses of associates and joint ventures on an equityટaccounted basis, from the date that significant influence or joint control commences until the date that significant influence or joint control ceases.
Transactions eliminated in the consolidated financial statements
The following are eliminated:
- intragroup receivables and payables; and
- intragroup balances and transactions (purchases, sales, dividends, internal margins, provisions recorded against consolidated companies, etc.).
3.2 Scope of reporting
3.2.1 Scope at 31 December 2023
Basis of reporting
Fully consolidated
Joint ventures
Associates
Equityટaccounted
Total scope of reporting
3.2.2 Changes in scope
The number of consolidated companies was virtually stable at 2,124 companies, compared to 2,128 at 31 December 2022.
The deconsolidation of 65 companies is mainly due to the removal of completed real estate programmes that have become inactive.
Development | Services | Other activities | Total at | ||
31/12/2023 | |||||
1,615 | 90 | 25 | 1,730 | ||
383 | 2 | 4 | 389 | ||
- | 1 | 4 | 5 | ||
383 | 3 | 8 | 394 | ||
1,998 | 93 | 33 | 2,124 |
61 companies were added to the scope of reporting during the fiscal year. These are mainly companies created to support the Group's real estate projects and companies resulting from external growth.
The Group carries out its new real estate projects in multiટprogramme companies, which explains the lower number of creations.
254 / Nexity / UNIVERSAL REGISTRATION DOCUMENT 2023
3.2.3 Assets and liabilities held for sale
A nonટcurrent asset or a group of directly related assets and liabilities is considered to be held for sale when its carrying amount will be recovered mainly through a sale and not through continued use. For this to be the case, the asset must be available for immediate sale and its sale must be highly probable.
To assess the highly probable nature of the transaction, the Group considers, on a caseટbyટcase basis, the decision and authorisation process, the reasonableness and acceptability of the proposed price, as well as the market conditions and legal, regulatory and social constraints.
These assets or groups held for sale are valued at the lower of the carrying amount and the estimated sale price, net of disposal costs. They are no longer subject to depreciation. The associated assets and liabilities held for sale are presented on specific lines of the consolidated balance sheet.
Impact on the balance sheet
(in thousands of euros)
ASSETS
Goodwill
Rights of use
Other nonટcurrent assets
Deferred tax assets
Non current assets
Operating current assets
Cash and cash equivalents
Current assets
TOTAL ASSETS HELD FOR SALE
(in thousands of euros)
LIABILITIES
Nonટcontrolling interests
Longટterm borrowings and financial debt
Nonટcurrent lease liabilities
Employee benefits
Deferred tax liabilities
Non current liabilities
Shortટterm borrowings, financial liabilities and operating liabilities Current lease liabilities
Operating current liabilities
Current liabilities
TOTAL LIABILITIES HELD FOR SALE
FINANCIAL REPORT
Consolidated financial statements at 31 December 2023
When the group of assets held for sale constitutes on its own a presented reporting segment, i.e. a business line, or is part of a coordinated plan to dispose of a business line, it is then treated as a discontinued operation, and as such, the net profit and each category of cash flows are presented on dedicated lines of the income statement and consolidated statement of cash flows.
In December 2023, Nexity entered into exclusive negotiations to sell its Services to Individuals business to Bridgepoint for an enterprise value of €440 million.
Since these property management (ADB) activities do not | |
constitute a business line, they are not treated as | |
discontinued operations. The income statement has not | 5 |
been restated. However, given the probable sale within 12 | |
months and the material nature of the assets and liabilities |
of these companies, they are presented at 31 December 2023 on specific lines under assets and liabilities on the consolidated statement of financial position.
ADB
230,000
45,223
53,666
3,780
332,669
952,622
18,651
971,273
1,303,942
-
-
35,348
10,171
2,376
47,895
86,056
11,474
1,012,827
1,110,357
1,158,252
Nexity / UNIVERSAL REGISTRATION DOCUMENT 2023 / 255
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Nexity SA published this content on 19 April 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 19 April 2024 14:20:07 UTC.