Polnord cautious despite success

The operating profit for the period came to PLN 21.9 mln and the net profit to PLN 3.3 mln. Over 2017 the group sold 1,389 units (up by 36 pct on the 1,024 sold in 2016), with the revenues from 1,113 premises being counted in its financial results (an increase of 34 pct on the 843 units sold in the previous year). Over the period the company launched apartment sales for 1595 units (up by 66 pct on the 962 units for 2016) in twelve projects in Warsaw, Gdańsk, Łódź, Olsztyn and Wrocław. At the end of the year the group had 1,401 units on sale, 28 pct higher than at the end of 2016 with 1097 units. The majority of handovers for the year were in Warsaw (59 pct) followed by the TriCity (14 pct).

“We expect a further increase in revenues over the coming months when we book the revenues of those apartments for which we signed sales contracts over the record breaking period of last year,” states Dariusz Krawczyk, the CEO of Polnord.

The developer’s debt decreased by 13 pct over the year from PLN 344 mln at the end of 2016 to PLN 299 mln at the end of last year. The developer claims that its results were not significantly affected by the termination of its contracts with KB Dom, which was the general contractor for most of its projects.

“We set up Polnord Construction within a week, which has effectively taken over all the construction work and will complete the projects without risk of delay to their schedules,” claims Dariusz Krawczyk. “However, this is an ad hoc measure because we do not intend to enter the general contracting market and on completion of these projects Polnord Construction will be terminated.”

The developer has a land bank with the potential to build a useable area of 300,000 sqm of residential space, Polnord intends to invest around PLN 10 mln every quarter in the purchase of land.

“We are very cautious in this regard and we’re not interested in plots with legal entanglements or in land that is too expensive or designated for agricultural use – such properties are a liability in the event of an economic downturn and could even prove disastrous for smaller developers,” warns the CEO of Polnord.