Renta 4 | Metrovacesa (MVC) has reported weak results for Q2 25-H1 25, with figures below our estimates as a result of lower-than-expected deliveries. In this regard, Metrovacesa is proceeding with the delivery of 177 homes in Q2 2025, compared to Renta 4’s estimate of 230 homes (delivery of 423 homes in H1 2025 versus 675 in H1 2024 and versus Renta 4’s estimate of 476). The average price of deliveries is also below our estimate, at €305k/unit in 2Q25 vsersus Renta 4’s estimate of €320k/unit (€290k/unit in 2Q24).
Meanwhile, the gross margin of the property development business stood at 22.0% in 1H25, 0.5 p.p. below our estimate of maintaining the gross margin at similar levels to those recorded in 1Q25 (down 2.2 p.p. versus 1H24). As for the land business, the company did not record significant figures in P&L (€1.8 million in revenue in 1H25), although it has a portfolio of contracts worth €98.7 million that will be formalised and recognised in P&L between 2025 and 2026.
From a commercial standpoint, there was a slowdown in pre-sales in Q2 2025, with 382 units pre-sold (versus 482 units sold on average per quarter in 2024, and versus 452 units sold in Q1 2025), although there continues to be a solid increase in prices (ASP of €366k/unit for 2Q25 pre-sales, up 12.6% vs 2Q24 pre-sales). As a result, the sales portfolio reached 3,676 units (€1,340 million at 1H25), raising coverage of expected deliveries to an estimated 96% in 2025 and 80% in 2026.
There were no major surprises on the balance sheet, with the LTV ratio increasing to 15.9% versus 13.1% at the end of 2024, and a slight improvement in NAV (up 3.6% like-for-like versus end of 2024) to €13.27/share (discount of -20% at current prices).
Finally, Metrovacesa takes the opportunity to reiterate its targets for 2025 (operating cash flow > €150 million versus Renta 4’s estimate of €199.9 million), anticipating a strong concentration of deliveries in 2H25, after 1H25 results that we believe should have a slightly negative impact on the share price. Conference call today at 10:00 a.m. CET.
We reiterate our Overweight recommendation with a target price of €11.90 per share.
