Hello, good morning, and welcome to the full year 2025 results webcast from Metrovacesa. My name is Juan Carlos Calvo. I am Director of Corporate Development and Investor Relations, and as usual, we have with us Jorge Pérez de Leza, CEO of Metrovacesa, and Borja Tejada, Chief Financial Director. We are going to present an overview of our operating activity and the financial results for the full year 2025. The slides of this presentation have been released to the market this morning, and they are available through the CNMV website, as well as the company website. We have also sent it by email to our usual distribution list for analysts and investors. At the end of this presentation, there will be a question and answer session.
If you wish to ask a question via conference call, you can register by pressing star five in your telephone keypad at any time, and if you are participating via webcast, you can type your question directly in the webcast platform, and we will read it out. We hand it over to our CEO to start the presentation. Please, Jorge.
Thank you, Juan Carlos. Good morning, everybody, and welcome to our full year results presentation. I'm very happy to have you here to share what we consider an excellent set of results for the full year 2025. Just as a summary, total revenues this year are close to EUR 710 million. EBITDA and net profit have reached a record figure with close to EUR 128 million and a 74% growth over last year, and a net profit of almost EUR 57 million with a growth of 258%. Our operating cash flow is well above the EUR 150 million guidance that we gave with a total of EUR 225 million.
Our dividend for the year, as you already know, and paid in full, was EUR 240 million, representing a 17% yield for the year. I think that, looking forward, we are still surrounded by a market context where housing demand remains very solid and demand for commercial lands keeps on improving, as we will see later on in the presentation. Our current pre-sales backlog offers a very good visibility on our upcoming residential developments and land sales for the next two, three years. Moving into page number seven, I would like to highlight here, probably focus on the prices, on the average prices of our units, where we see that our deliveries this year were, on average, at EUR 375,000 per unit.
If we look at our backlog, we see that it's still a very strong number of EUR 360,000 per house. The units under commercialization are close to EUR 380,000. And therefore, I reiterate my previous statement that the backlog offers quite a good positive outlook for the next two, three years coming forward. Now, moving on to page eight, I give the floor back to Juan Carlos to give us a brief overview on the market.
Yes, well, very quickly, a few data. I mean, the market in Spain was quite strong, both in terms of prices and volumes during last year. Prices accelerated, according to the official statistics, to a double-digit growth, 12.7%, and the volume of transactions increased to over 700,000, which is the highest figure since the previous cycle. The main reason for these two parameters is the continued imbalance between supply and demand. Actually, we have already accumulated quite a few years of this imbalance, and just looking at the last five years alone, we have accumulated approximately 600,000 units of shortfall of supply, according to the growth in households.
This continues to be the main driver behind the increase in prices as well as volumes. It is true that in the last few months, we have seen some moderation in the growth rate, and probably we will continue to see some moderation into next year, both in prices and volumes. Obviously, the prices, in the extent that it is going higher, it is making it a little bit less affordable for some groups of the potential demand. Still, the outlook continues to be a continuation of a positive trend. Perhaps more moderate than last year, but a continuation of a positive trend. Back to Jorge.
Yes. Thank you, Juan Carlos. Moving on to more operational KPIs. In terms of residential deliveries, we delivered a total of 1,805 units, with an average selling price of EUR 375,000 per home, driven by a mix of products. You can see that we've delivered some premium projects over the Q4 , like Málaga Towers, the second tower, Vision, also the Mesena 80 project in Madrid, as well as Serene Atalaya in Estepona, Málaga. Nevertheless, as I said before, if you look at the backlog, it's still quite strong in terms of average selling price going forward.
Probably more important is the gross margin, in which we have raised our gross margin to the development gross margin to a little bit more than 26%. This is driven obviously by tailwinds in the market, but also to the strategy that we followed in the last six months of the year, as we mentioned on our previous calls. That was, you know, really optimizing margin and given the very good coverage of sales for the deliveries not only in 2025, but in the coming years. We were optimizing margin and therefore selling a little bit less of units in the last part of the year in order to maximize the price and therefore the margin.
Good set of margin, and I think as we'll mention later on, I think the mid-20s figure in terms of gross margin is something that we consider a good assumption for the coming years. In terms of pre-sales, moving on to the next page, we sold 1,635 units in the year with a strong Q4 , in which we sold 434, with an average selling price, which is slightly higher than our backlog and also the deliveries. Again, this gives you a good picture of what's coming forward. An absorption rate of 2.5%, which is our average, and where we would like to be in this operating metrics.
In terms of sales backlog, moving on to the next page, we have just a little bit over 3,100 units in the backlog, with an average selling price of EUR 360,000, and with a very strong coverage ratio for our deliveries coming forward, standing at 89% in 2026, 66% in 2027, and 27% in 2028. Then, sorry, around 80% of this backlog is actually formalized in private contracts with more than a 10% down payment. In terms of construction, we have around 4,000 units under construction, including 851 units, which have already been completed, which means they have a certificate of final construction.
We started the construction of around 1,600 units in the year. In commercialization, we have 5,200 units, again, with a potential revenue of EUR 2 billion and an average selling price of close to EUR 380,000. 60% is already pre-sold, we have around 2,500 units, which are in the design phase, and will come into commercialization in the next few months or over the year. Moving into the next page, Isla Natura, I think the photo in 2022 and what you see in 2025, it speaks by itself. This is a project where we have basically started from scratch. We launched over 1,800 units already.
820 have already been delivered across 13 developments, and we continue to deliver throughout the year and then in the coming year. Unfortunately, we're running out of units, but we have around 200 more to launch, and also we have transformed some commercial land plots. Given the urgent measures approved by the regional government of Andalusia, we were able to transform some commercial land into protected housing, and we've launched around 300 additional protected units in the neighborhood. We hope this to be, you know, a proof of what we can do as a strong operating company with a strong balance sheet.
We shall be able to replicate this success story in some of our big developments where we have, such as Los Cerros, Seda-Papelera , Benial or Benimaclet in Valencia coming forward. Moving on to page 13. In terms of Madrid, this is going to be a strong example of launches in 2026, or commercial launches, in which in Los Cerros, you know, we have in this development around 2,700 units. The final reallotment has been approved, and therefore, in the short term, we shall be able to start selling in this development, in this area, where you know that in all the southeast region of Madrid, the commercial performance is very strong, given the lack of housing in Madrid.
In Valdecarros, where we have around 450 units, the final reallotment is expected in the mid of 2026, and urbanization works for phase number one are already 90% completed, and stage two and three are advancing quite strongly. Good prospect for our developments in Madrid, in Los Cerros and in Valdecarros, coming forward. In terms of land activity, land sales in P&L stood at EUR 32 million, which actually was a little bit lower than what we expected, given that one land sale was actually skipped into the Q1 , which is Valdebebas, and actually was signed yesterday. This is done.
We have a very strong backlog of binding contracts coming for coming in the next year. EUR 163 million in total, which are already signed in private contracts, and will be basically, will appear in the P&L as they are notarized in 2026 and 2027. In terms of land acquisitions, we acquired around 600 units. As you know, following our top up strategy of adding some units in order to be around, you know, our strategy of around 2,000 units per year. We acquired these units in core markets like Valencia, in Valdecarros, as well, Sabadell in Barcelona, and Marbella in Málaga. We will continue with our capital allocation policy of buying, you know, in selective approach.
Also, in some cases, we are now considering investment in partnerships with some players and funds that have actually approached us to co-develop with them in the BTS and Flex living segments. Something that will not be, you know, will be an add-on strategy to our core portfolio that will be coming as we transform the non-fully permitted land into fully permitted in the coming years.
In terms of the commercial portfolio, in page 15, very good news that came out in a press release at the end of the year, in the sense that we signed a turnkey project for office development in the two land plots that were still pending for delivery in the Oria Innovation Campus project, with a price of 200 million EUR for a total of 48,000 square meter of GLA and a top development in terms of certifications. These projects will start construction in the coming weeks and will be delivered at the beginning of 2029.
I think it's good news because a very well-rounded mixed-use development for the area, having not only offices, but also, as you remember, the PBSA that will be delivered in 2026. We're just about to finalize construction in the next couple of months. Also, the co-living that is coming in 2027 with Vita being an operator in both. This is the office deal. We'll also actually, as I mentioned, create a very a pole of attraction in the area, and again, will be an example of what we are able to deliver in big developments.
I also want to take the opportunity to give a, you know, a short overview of where we are at in our commercial development. As, as you remember, in our commercial portfolio, which, as you remember from the beginning, our idea here was to, you know, basically reduce our exposure by a value-add strategy that could mean sales of land, or turnkey projects, or JV developments. We started with a total gross asset value of around EUR 700 million, and we are now at around EUR 350 million, but 50% of that is already actually pre-sold and will be delivered, and therefore, notarized in the next two, three years. Our exposure has greatly diminished now.
The 49% that I mentioned, that is already pre-sold, you have the breakdown is the Oria offices, as well as the other two developments, La City in Barcelona, where we signed a pre-sale agreement to develop a Flex Living by a third party. In that area, Monteburgos I, which is the land located next to our office, where we signed some pre-sales agreements to develop retail and a hotel. Valdebebas, that I mentioned, we actually notarized yesterday. Then, the Loins in the 22@ District, where we signed a pre-sale agreement to sell the land.
Just to finalize, in Portos and Port Office, which were the project that we developed, a 20,000 sq m, that we developed together with Tishman Speyer, and where we own a 24% stake. At the end of the year, we had an 87% occupancy, and we are in advanced negotiation to for an additional 10% take-up, so basically to have a full occupation in the next few months. Finally, on ESG, we continue with our ultimate objective, which is to position Metrovacesa as a sustainable and responsible developer. We are advancing in, you know, different set of measures that you can see here, not only on environmental, but also on our social and governance metrics.
With that, I finish with the operating set of results, and I hand it over to our CFO, Borja, for a financial review.
Thank you, Jorge. Let me start with the profit and loss summary. As Jorge mentioned, 2025 was a record year across all key metrics. Total revenues reached EUR 709 million, 8% year-on-year, driven mainly by residential development, while land sales contributed EUR 32 million. Gross margin increased significantly to EUR 180 million, with residential gross margin expanding to above 26%, reflecting a strong product mix and solid execution. EBITDA amounted to EUR 128 million, representing an 18% EBITDA margin, and 74% increase year-on-year. Net profit reached around EUR 57 million, and importantly, recurring pre-tax profit more than double to EUR 109 million, confirming that earnings growth is fundamentally operational and sustainable.
Moving to operating cash flow in slide 20, fiscal year 2025 cash generation was exceptionally strong. Gross operating cash flow reached more than EUR 225 million, significantly above our initial guidance, over EUR 150 million. This performance was driven by EBITDA growth, optimal land monetization, and efficient discipline of land investment. Cash generation clearly demonstrates that quality of earnings and the cash conversion capacity of our business model is a reality. Turning to the net debt position in the slide 21, we closed the year with a total cash of EUR 200 million and net financial debt of EUR 300 million, improving versus last year, despite the high dividend paid in 2025. Loan to value remains very stable at 13.5%, slightly below our long-term reference range of 15%-20%.
Potential liquidity is strong, with more than EUR 300 million of undrawn committed facilities, the average cost of our debt stands at 5.5%. Overall, the company maintains a solid and resilient financial structure, which providing flexibility to execute the business plan and sustain shareholder returns. Finally, on asset valuation NAV, total GAV amounts to EUR 25 billion at the end of the year. Net asset value stands at EUR 12.13 per share, representing a like-for-like increase of 3.5% versus December 2024, adjusted for the dividend paid. The positive evolution is driven by residential assets, partially offset by more cautious valuation in commercial segment. This confirms the underlying value of our portfolio and the strength of our residential-focused strategy. I will hand over Jorge with closing remarks.
Thank you, Borja. Moving on to page number 24, I would like to take a couple of minutes to go over our evolution from 2018 until 2025, in which, you know, I think we are really showing our efforts to focus on dividends and a strategy driven by cash flow. Given that we started with a very large land bank, which at that point was, you know, not active, and then we started on the process of making it work, and I think, our strategy is really paying off at the end, no? In terms of GAV, what we see is that, our current GAV of EUR 2.2 billion, the active GAV, in terms of %, has really increased.
As I mentioned below, before, our commercial GAV has diminished or decreased through a value-add divestment strategy. The key operating data, I think, it speaks by itself with, you know, total launches of close to 16,000 units, sales of 13,000 units, deliveries of a little bit more than 10,000 units, land transformation from non-fully permitted to fully permitted, and land sales as well, no? At the end, this results in more than close to EUR 900 million dividend already paid, and obviously, respecting our policy of a payout of more than 80%, and exactly in this case, 92% of the operating cash flow generated in the period.
We will obviously continue with this strategy going forward, and with our focus on cash flow and dividends as well. To finalize, on page 25, I think, as takeaways, I think, again, we are very happy to share this strong set of results for the year, with revenue growth and growth margin expansion, driving to a net record, EBITDA and net profit. A significant increase in average selling price, of deliveries for the year. I think this is not only, an effort of the Q4 , where we can see, you know, some significant, increase because of the product mix.
e result of a strategy of being very driven by IT and digitalization, and improving our commercial funnels, and then being able to make very quick decisions on a weekly basis in order to maximize the revenue of all our projects. The solid presale coverage, as I mentioned before, with the high percentages of units sold on our coming deliveries for the next three years, makes us be quite positive on the forecast, as well as on the EUR 165 million of land pre-sales that will eventually come into notarization in the next couple of years, no
Attractive dividends for the year, EUR 240 million, with a 17% payout, which is probably one of the most attractive payouts in the, not only in the industry, but in general, in the stock market in Spain. Our next dividend will be in May of 2026, with a figure to be announced in March, as we have done in previous years. As I mentioned before, our solid outlook for the year, well, makes us, you know, think that our gross cash flow generation will be above EUR 200 million, with housing development deliveries of units, you know, similar to 2025.
Finally, land sales with significant growth, given the backlog of 165, plus additional deals that obviously will come into in the year, no? With that, I conclude. Thank you very much for joining, and I hand it back to Juan Carlos now for Q&A.
Thank you, Jorge. Yes, we are now ready to start the question and answer session. We will start taking questions from our participants in the conference call. If you wish to ask a question, please dial star five in your telephone keypad. Now we will allow for a few seconds so that you can register your questions. Okay, the first question comes from the line of Mariano Miguel, from Banco Santander. Mariano, can you hear us?
Hello, guys. Can you hear me?
Yes.
Hello?
Go ahead.
Yes. Okay. Morning, everyone, and thanks for taking my questions. I have two, if I may. In Q4, your gross development margin stood closer to 30%. You were guiding for higher margins, but it was, I would say that not as high as this one. I was wondering if in the next two years, we should expect it to remain closer to 30% or more towards 25%. That, I would say, is what I was more expecting. Second, on dividends, you have distributed more than 100% of your gross operating cash flow this year. Again, how should we look into the potential dividend payout in 2026, as your cash flow is gonna be above EUR 200 million? One last one, please.
on land acquisition, if you could please give us some color on your expectations for next year, as I believe part of your non-fully permitted land is gonna be transformed. I don't know if that might affect that potential policy in terms of land acquisition. That's all on my side. Thank you.
Thank you, Mariano. I will, I, Jorge here, will take the questions. I think the Q4 exceptional margins, gross margins are mainly driven by the product mix. Coming, you know, we delivered Málaga Towers, the second tower, Vision. We also delivered, I think a project in Madrid, Mesena, also, you know, a couple of other projects in Costa del Sol. Not only that, I mean, as I mentioned before, I think it's a matter of given the coverage we started with at the beginning of the year, you know, we have to basically sell 20%-25% of the deliveries in the year.
We've been very, very pushy and very, you know, I think surgically working on how to get the best contacts into, if to sell that 25% in order to maximize product pricing, no? I, you know, it sounds. It may sound a little, you know, kind of, I don't know what word to use, but the reality is that we are using some artificial intelligence model in order to get our contacts and to drive them into final sales. That, I think, are playing an important role in these last sales of each development, where you're really focusing on getting the best clients at the highest price, no?
Going forward, I would love to see that we, you know, we're gonna be close to 30%. I'm not optimistic. I think that, you know, a 24% is a, is a recent, is, I would say, a more accurate figure. You know, in some quarters, you may see 24% because of the mix, and some other quarters, you will see 26%, 27% because of mix. Overall, for the year, if I was, you know, if I had to put a figure in the Excel, I think between 24% and 26% would be a great figure. Dividend, yes, higher than 100%.
I think, as I've always mentioned, I think we are cash flow driven, we are dividend driven. We understand that the market is, you know, likes dividends at this point. We are, you know, we are very proactive to dividends. That's why we paid more than 100% of the cash flow generated in the year. Is that going to be the norm coming forward? No, I would say that our policy still stands at paying a cash payment of 80% o r higher than 80% of the cash flow generated.
Obviously, you know, the, it's actually the board that has to decide this and then propose it to the to the to the in the annual shareholders meeting. You know, if we see a positive positive forecast, we see that that, you know, the LTV, it stands at a reasonable figure, et cetera. I think we will, you know, give priority to dividends rather than than anything else. Land acquisitions, I think our strategy again, keeps to be the same, which is a top-up strategy. You know, in order to to complement the projects that are or the launches that are coming from the land transformed into fully permitted.
That means that, you know, in terms of acquisitions, we are talking about 500, 600 units per year in order to do that top up. It is true that if we find some attractive land investments that are bigger than that, we will go, we will try to go for them, probably with co-investment partners in that sense. So that we have again, a combination of investment, but also a focus on dividends. Basically, that will be the case. W e have to see how also the land market turns out to be in 2026.
No, I think there could be less people buying. There could be better opportunities. We're ready to go for those opportunities. Again, if they're large, we will go with co-investment so that we keep a good balance between dividend and investment of our own equity.
Okay. Thank you very much, Jorge. Very clear.
Thank you. We don't have more questions from the audio conference call, so we will now read questions received on the webcast platform. We have several, actually, three analysts asking mainly on the same point, which is gross margin. A question from Javier Díaz, analyst from Renta 4, Julián Megías , analyst from Kepler Cheuvreux, and Ignacio Dominguez, analyst from JB Capital. Essentially, the three are asking again about the gross margin. If you can say what was behind the increase in of margins from Q4, and whether this could be. What could be the expectation for gross margin going forward? In a way, it has been answered already, but if you want to add anything.
Yes, I mean, I would say that, in order to reiterate myself, I mean, in 2026, you know, we've already sold 89%, so we have 11% of the units left that to be sold. We will, you know, again, apply most of our knowledge and technology in order to maximize the prices on that. That should move the needle a lot. Well, with 11%, not that much, but we are very comfortable in saying, you know, that the 25% is good. Obviously, in 2027, you have a little bit more room because we've pre-sold 66%, so it means 34% is still there to be sold, and then in 2027, there's one more figures.
We do see sales growth or price growth is still coming in the next two years. As Juan Carlos mentioned, probably not, you know, we're not talking about figures in 10%, but rather closer to 5%. That should, you know, may move them, the needle upwards in 2027 and 2028. I think in 2026, the game is already, you know, almost done. With 11% to go, we will try to, you know, surpass that 25% gross margin, but I think, we cannot expect 30%.
Okay. Thank you. Also, William from Kepler Cheuvreux, he was also asking about the land investment pipeline. How does it look? There are any good opportunities in Tier 1 cities with good returns, in which regions or areas?
I think the land market is not easy right now, especially in Tier 1 markets, where for two reasons. First of all, is that, there's no land. I mean, there's very little fully permitted land. And then, you know, there's two ways to source that land, and, you know, one of them is through tenders. You know, public tenders, meaning that they're open for everybody, and those are, I think, extremely competitive. We, you know, we did source in the past some good deals through that source. Going forward, I think it's going to be difficult because probably price expectations are too high.
I think we are, we are quite good in working at bilateral transactions, so actually identifying land that is fully permitted or almost fully permitted with very, you know, few things to solve before being able to launch, you know, to launch in one year or less. In those bilateral transactions is where we are able to find, you know, land that is in the high teens of IRR and with reasonable gross margins that are in line with our, with our strategy. If we don't find those, we just will not buy. I mean, I think With the land bank that we have in hand, we have no pressure to, you know, to be buying thousands of units every year.
We, as I mentioned before, our strategy is a top-up strategy. We will do it, you know, with opportunities that fit our return expectations. I can say that, you know, in the land that we acquired in the last two, three years, I think we are, in all of them, beating our underwriting at the time of purchase. They're performing extremely well, and we just don't want to jeopardize that experience. We will just focus on good deals.
We have an additional question from one investor, in a way related to investments as well, but way with a focus on the construction costs. Given the increase in construction costs, do you think there are still affordable land plots in the city peripheries, for you to be able to renovate your land portfolio at a reasonable price?
Trying to understand the question, so let me take it in part. I think, you know, to talk about construction costs, yes, we have, we are experiencing some construction costs. Nevertheless, the price increases actually are outweighing the increase in construction costs, and hence, an increase in the margins. Yes, we are seeing construction costs, but the sales are growing at a slightly faster pace, and so therefore, we don't see erosion in margins. I think going forward, even with sales increases being more moderate, I think we're still not thinking about, you know, margin erosion. Thinking about affordable land plots, I'm not sure if that means land for affordable housing or land that is at good, at good price in the peripheries.
Well, we're still not in need to renovate. I mean, we have a large enough land portfolio, as I mentioned before, so that we only do acquisitions that are, you know, with good returns in order to top up to be in a, you know, in a run rate of between, as you see in the last figures, between 1,700 and 2,000 units, something like that. We are not at a stage in which we need to renovate our full portfolio. We will do acquisitions just, you know, on a very specific basis and with good returns.
In a few years down the road, it is when we will have to buy, you know, more, more aggressively. Good opportunities, I would say there are, but they're scarce, so that would be my conclusion.
Thank you. One additional question from an investor. It's about the land sale in private track. You have, at the end of the year, EUR 163 million of a backlog in land sales. Can you give us an estimate of the timing of those of the formalization of these land sales?
Yeah, I mean, I could be super specific, but, you know, always one deal may skip one year or whatever, but I think it would be reasonable to say that, you know, something slightly above 50% will be in 2026, and then the remaining in 2027.
Thank you. It seems that we do not have any more questions on the webcast or the conference call. With that, we will conclude our presentation of Metrovacesa full year results 2025. The investor relations team will be available to take any follow-up questions that you may have, as usual. We thank you for your participation, and we look forward to meeting you again next time. Thank you, and goodbye.