Kaufman & Broad 9M 2025 slides: outperforming market with 6.2% revenue growth

French property developer Kaufman & Broad SA (PAR:KOF) reported solid results for the first nine months of 2025, with revenue growing 6.2% year-over-year to €744.7 million, according to its presentation slides released on October 3. The company continues to outperform the broader housing market despite industry challenges, maintaining its operating margin at 7.6%.

Market Context & Housing Position

Kaufman & Broad is navigating a challenging French housing market, where housing permits and starts have declined 42% over 17 years despite population growth of 4 million during the same period. Despite these headwinds, the company has demonstrated remarkable resilience.

The company significantly outperformed market trends across key metrics. While the broader market saw declines in housing being marketed (-6%), commercial offers (-10%), and orders (-10%), Kaufman & Broad achieved impressive growth of +59%, +37%, and +12% respectively in these categories.

As shown in the following comparison of commercial performance between Kaufman & Broad and the broader market:

The company’s take-up rate (the time needed to sell available inventory) stood at 5.1 months at the end of August 2025, substantially better than the market average of 19.7 months. This efficiency in inventory management has been a consistent competitive advantage for Kaufman & Broad over several years.

The following chart illustrates this significant performance gap in take-up rates:

Quarterly Performance Highlights

Kaufman & Broad reported housing orders of 3,760 units for the first nine months of 2025, representing a 9.5% increase from the same period in 2024. The value of these orders rose to €826.9 million, up 6.3% year-over-year.

The company’s housing land portfolio expanded to 34,474 lots, a 13.6% increase compared to August 2024, providing over six years of activity with 84% of lots located in high-demand areas. This strategic positioning supports sustainable growth despite market fluctuations.

The customer mix for housing orders showed a shift toward individual buyers, with first and second-time buyers increasing to 24% of total lots (35% of value) compared to 18% (24% of value) in the previous year. Block sales decreased slightly to 64% of lots (53% of value).

This changing customer breakdown is illustrated in the following chart:

Commercial Property Growth

Commercial property emerged as a significant growth driver, contributing 18% of total revenue in the first nine months of 2025, up from 12.9% in the same period of 2024. Revenue from this segment reached €133.8 million, a substantial increase from €90.3M in the previous year.

The company reported having 108,900 square meters in development, 123,700 square meters under marketing, and 113,500 square meters in construction. The commercial property backlog stood at €384.4 million, down from €552.5 million at the end of August 2024.

The following slide details the commercial property activity:

Financial Analysis

Kaufman & Broad’s total revenue for the first nine months of 2025 reached €744.7 million, a 6.2% increase from €701.2 million in the same period of 2024. Housing remained the largest contributor at 80.5% of revenue (€599.2 million), while commercial property accounted for 18%.

The revenue breakdown by segment is shown in the following chart:

The company maintained its current operating income margin at 7.6% of sales (€56.8 million), consistent with the same period in 2024. Gross profit stood at €149.2 million, representing 20% of sales.

The following waterfall chart illustrates the path from revenue to operating profit:

After accounting for financial expenses, taxes, and minority interests, attributable net income reached €33.3 million, representing 4.5% of sales:

Kaufman & Broad maintained a strong financial position with shareholders’ equity of €220.2 million and a robust net cash position of €394.7 million (excluding IFRS 16 and Put Néorésid lease debt). The company’s solid balance sheet is reflected in Fitch’s confirmation of its BBB- Investment Grade rating with a stable outlook, making Kaufman & Broad the only pure continental European developer with an investment grade rating.

The simplified consolidated balance sheet as of August 31, 2025:

Outlook & Forward Guidance

Kaufman & Broad maintained its outlook for the full year 2025, projecting revenue growth of approximately 5% and a current operating income (EBIT) margin between 7.5% and 8%. The company expects to maintain a significant net cash position even after the payment of nearly €43 million in dividends for fiscal year 2024.

Market conditions appear supportive with interest rates remaining competitive at 3.14% over 20 years and 3.27% over 25 years as of August 2025. The extension of the zero-interest loan program (PTZ) to the whole of France and increased income ceilings should further support demand, with projections of 40,000 loans for new homes in 2025 compared to 25,000 in 2024.

With its strong market position, healthy balance sheet, and strategic land portfolio, Kaufman & Broad appears well-positioned to continue outperforming the broader market despite persistent industry challenges in the French housing sector.

Full presentation:

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