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Kaufman & Broad cautious on 2015, open to acquisitions
January 22, 2015 / 5:12 PM / 3 years ago

Kaufman & Broad cautious on 2015, open to acquisitions

* Company sees stable revenue and gross profit this year

* CEO says economic, political conditions rocky

PARIS, Jan 22 (Reuters) - French property developer Kaufman & Broad said on Thursday it was cautious about its outlook for this year but was open to acquisitions despite still difficult economic and political conditions.

The group said it expected revenue to be stable this year after rising 5.6 percent in 2014 to 1.08 billion euros ($1.23 billion), ahead of its forecast for sales to be largely flat.

The company, which is primarily focused on residential property development and is 89 percent owned by private equity group PAI Partners, also said it expects stable gross profit this year after it slipped 1.3 percent last year to 194.3 million euros.

“We’re cautious because we are still in a rocky environment in France,” Chief Executive Nordine Hachemi told Reuters in an interview.

“We are wary about the prospects for 2015 even if we have a government that’s understood the importance of housing for the economy,” he added.

A deep housebuilding slump forced the government last year to backtrack on some of its key housing polices, prompting it to introduce a range of tax breaks to boost the rental market, free up land for new construction and make it easier for poor households to buy homes.

It also promised to slash red tape holding back housing investment and weighing on house prices despite a massive shortage of appropriate housing.

“We have a legal environment that is interesting for investors and landowners who can be enticed to put land on sale for construction, which is good for supply,” Hachemi said.

“But there is still a big administrative burden for building permits,” he added.

French homebuilders produced only 300,000 units last year, the lowest level since 1997, according to the French homebuilding federation.

With prospects for a strong recovery dim, Hachemi said the company could look to acquisitions to fuel growth.

“We are open to everything, we want to develop. If we see interesting acquisition opportunities, we are not going to stop ourselves studying them,” he said. ($1 = 0.8753 euros) (Reporting by Leigh Thomas and Matthieu Protard; Editing by James Regan)

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