Hungary Duna House to pay smaller-than-planned dividend, but starts 2024 strong

Duna House's numbers continued to improve in the first quarter of 2024, according to newly published figures.

• During Q1, intermediated loan volumes reached a record high of HUF 256 billion (+76.8% yr/yr and +3.0% q/q), mainly driven by growth in the Polish market.
• In the real estate franchise segment, the network generated nearly HUF 4 billion in commissions in the first quarter of 2024 (+54.1% year-on-year and +10.6% compared to the fourth quarter of 2023), the second strongest quarter ever for the Group after the first quarter of 2022 (HUF 4,075 billion in commission income).
• Commission volumes in the own office segment amounted to HUF 498 million in Q1 (+32.1% yr-yr)

Italian credit intermediation volumes grew by 6% year-on-year on a euro basis in the first quarter. Compared to Q4 2023, the decline is 7%, due to normal seasonality. The Group has signed a significant cooperation agreement with the real estate brokerage network Professione Casa, which is expected to generate significant organic growth, gradually building up from 2024.

In Hungary, the positive trend that started after the market trough in Q1 2023 continued, with all main segments growing significantly on a year-on-year basis in Q1 2024. The Group's Hungarian franchise real estate volumes increased by 56% year-on-year, while own office volumes jumped by 63% year-on-year. The Group's Hungarian lending volumes grew 121% year-on-year and loan application data points to further growth in the second quarter.

Poland has seen an explosive performance since the trough in the last quarter of 2022, driven in part by a favourable macro environment and in part by government-backed lending programmes. Franchised real estate brokerage volumes grew 52% year-on-year, while own office brokerage volumes rose 6% year-on-year. Loan intermediation volumes jumped 232% year-on-year to a new record. The turnaround in the credit market was helped by the easing of payment-to-income conditions for fixed-rate loans by the regulator and the launch of the First Home scheme on 1 July to help first-time home buyers under the age of 45. Although the programme's budget ran out at the end of the year, disbursements continued until the first quarter of 2024, maintaining the momentum of the credit market. The loan disbursement is preceded by the signing of the contract for the purchase of the property, so the minimal decline in the property market is already due to the expiry of the programme. Further state support is expected only in the second half of the year, so more moderate volumes are expected in Poland in the next 1-2 quarters.

In a separate statement, DH said that the dividend proposal of the Board of Directors (HUF 124.82 per ordinary share) included in agenda item 10. of the proposals of the General Meeting published on Monday differs slightly from the planned dividend proposal (HUF 131.0 per ordinary share) published in the unaudited consolidated Quarterly Report for the fourth quarter of 2023 on 28 February 2024. The deviation is HUF 6.18 per share (-4.7%) due to loss-financing among the Company’s real estate development subsidiaries limited the amount of dividends available to the Company. 

The HUF 124.82 DPS translates into a 12.5% dividend yield on the basis of Monday's closing price on the Budapest Stock Exchange (BSE). DH shares gained 55.3% this year.