Unibail-Rodamco-Westfield SE · EURONEXT:URW
Unibail-Rodamco-Westfield — H1 2021 Earnings Presentation
45 slides from Unibail-Rodamco-Westfield's earnings presentation, Jul 28, 2021
Slide 1: Half-Year Results
UNIBAIL-RODAMCO-WESTFIELD
Slide 2: H1-2021 Overview
H1-2021 OVERVIEW JEAN-MARIE TRITANT CEO
Slide 3: H1-2021 in review
H1-2021 in review Continued resilience in tough operating conditions consistent with expectations Encouraging recovery in footfall and sales data when restrictions ease Total focus on operational and financial priorities – good progress in H1-2021 Favourable access to credit markets – ample liquidit
Slide 4: Delivering on operational and financial priorities
Delivering on operational and financial priorities Operational Financial Opening of Westfield Mall EUROPEAN DISPOSAL €1.7 Bn of €4.0 Bn target FOCUS of the Netherlands PROGRAMME (2021/22) agreed or completed ON FLAGSHIP La Part-Dieu and La Maquinista DESTINATIONS extensions €0.3 Bn of debt reduction
Slide 5: Performance reflects tough conditions, with early positive indicators
Performance reflects tough conditions, with early positive indicators C&E Offices Shopping Centres NRI -97% NRI -24% NRI -25% Substantially closed during Impact of SHiFT and Les Impacted by lockdowns or trading H1-2021 due to restrictions Villages 3, 4 and 6 disposals restrictions in all markets and
Slide 6: URW's shopping centres impacted by substantial closures and other restrictions
URW’s shopping centres impacted by substantial closures and other restrictions Days “closed”(1) 100 91 83 85 67 68 c. 40 days with 57 limited restrictions vs. 70 days fully normal in H1-2020(2) 0 Continental Europe UK US Group H1-2020 H1-2021 (1) “Closed” means the centres were restricted to essenti
Slide 7: Continued support for tenants
Continued support for tenants Cash rent relief €220 Mn / 1.5 months Negotiations remain on fair “burden sharing” principle, offering more support • vs. €33 Mn in H1-2020, due to timing of for smaller and most impacted tenants negotiations and accounting treatment Operating in a changeable legal envi
Slide 8: Recovery of sales and footfall in line with reopening
Recovery of sales and footfall in line with reopening 80 100% 90% 90% 70 80% 76% 80% 60 sales / footfall as % of 2019 People vaccinated per 100 70% 65% 50 56% 60% 52% 53% 49% 51% 40 48% 50% 50% 46% 45% 43% 46% 40% 30 35% 30% 25% 20 20% 10 10% 0% 0 0% January February March April May June Sales Footf
Slide 9: After reopening of all centres in Europe, June saw strong recovery in footfall
After reopening of all centres in Europe, June saw strong recovery in footfall with tenant sales outperfoming June (in % of 2019) Select category results (vs. 2019) Category June YTD Footfall Sales Continental Europe 77% 89% Jewellery +2.1% -46.8% Food Stores & -2.0% -3.9% UK 68% 72% Mass Merchandis
Slide 10: US tenant sales now at pre-COVID levels
US tenant sales now at pre-COVID levels… US tenant sales (vs. 2019) Select category results (vs. 2019) 107% 98% 100% Category June YTD 91% 87% 74% Luxury +45.6% +42.6% 69% Home +27.1% +17.0% Jewellery +23.3% +15.4% Fashion -4.0% -14.8% January February March April May June June - non- CBD Flagship F
Slide 11: Despite URW's large exposure to US states with more stringent restrictions
... despite URW’s large exposure to US states with more stringent restrictions URW’s exposure to key US states(1) Average stringency of COVID-19 restrictions(2) 84% NY California New York CA New Jersey Texas TX Florida FL 2% Less stringent More stringent (1) Based on percentage of proportionate US r
Slide 12: Improvement in leasing supported by flexible and dynamic letting strategy
Improvement in leasing supported by flexible and dynamic letting strategy 1,218 leases signed (vs. 1,185 in H1-2019) 44% +1.3% 56% -13.8% leases > 36 months MGR uplift leases ≤ 36 months MGR uplift 1. Long term leases (>36 months) 2. Short term leases (≤36 months) Demanding on the tenant quality Pra
Slide 13: URW is the preferred partner for top brands
URW is the preferred partner for top brands 8 Deals 7 Deals 3 Deals 5 Deals 1 Deal 4 Deals 5 Deals 3 Deals 2 Deals 1 Deal NB: long-term relettings and renewals only 2021 HALF YEAR RESULTS 13
Slide 14: Accelerating demand for social entertainment experiences
Accelerating demand for social entertainment experiences based on COVID reopening Beer Garden, Westfield World Trade Center Cruel Summer promotion, Westfield Century City Miss Voon rooftop popup, Westfield Mall of Scandinavia Pinstripes Bowling/Bocce/Dining, signed for Hapik, La Part-Dieu Westfield
Slide 15: Successful opening of deliveries
Successful opening of deliveries GLA URW ownership GLA URW ownership GLA URW ownership +87,100 sqm 100% +1,300 sqm(2) 51% +32,000 sqm 100% Opened 100% TIC Opened 100% TIC Opened 100% TIC March 2021 €630 Mn March 2021 €30 Mn Nov’20 – June’21 €440 Mn Letting(1) May/June footfall Letting(1) Letting(1)
Slide 16: Steps to streamline the US portfolio and prepare for disposal strategy
URW has taken significant steps to streamline the US portfolio and to prepare for disposal strategy Four assets voluntarily foreclosed (with one further expected in H2) €0.3 Bn reduction in debt from foreclosures Generated a substantial reduction in IFRS debt & a net capital gain Completed big-box c
Slide 17: Broad recognition for results of Better Places CSR strategy
Broad recognition for results of Better Places CSR strategy Five-year €3.1 Bn sustainability-linked revolving credit facility, tied to Energy intensity // GHG emissions reduction including Scope 3 // BREEAM In-Use certification // CSR training of URW employees URW ranked 1st in RE industry and 1st i
Slide 18: H1-2021 Financial Review
H1-2021 FINANCIAL REVIEW FABRICE MOUCHEL CFO
Slide 19: H1-2021 Results
H1-2021 Results € Mn H1-2021 H1-2020 Change Lfl Change Shopping Centres 753 1,008 -25.3% -21.8% Offices & Others 32 42 -23.9% -1.0% Convention & Exhibition 0 15 -97.1% -97.1% Net Rental Income 785 1,065 -26.2% -22.4% Recurring Net Result (Group share) 472 667 -29.3% Recurring EPS 3.41 4.82 -29.3% Ad
Slide 20: Impact of pandemic on H1-2021 AREPS
Impact of pandemic on H1-2021 AREPS +€0.28 +€0.01 -€0.01 -€0.08 -€1.21 -€0.09 -€0.30 -€0.01 €4.65 COVID-19: -€1.10 €3.24 €3.24 AREPS P&L impact Doubtful Variable Convention & Financial Services Disposals Others (2) AREPS H1-2020 COVID-19 debtors income streams Exhibition (1) expenses H1-2021 rent re
Slide 21: Like-for-like retail NRI evolution impacted by rent relief
Like-for-like retail NRI evolution impacted by rent relief Net closures, renewals, relettings COVID-19 and indexation rent relief Doubtful debtors Other Total Lfl Continental Europe -3.8% -21.0% -4.1% -2.0% -31.0% United Kingdom -20.7% -28.9% +21.0% +18.5% -10.1% United States -12.5% -8.4% +20.5% +0
Slide 22: Update on COVID-19 rent relief: cash and accounting impact
Update on COVID-19 rent relief: cash and accounting impact Rent relief(1) granted to URW retailers in H1-2021: • Cash impact: €220 Mn (1.5 months) vs. €33 Mn in H1-2020 and €313 Mn in FY-2020 • P&L impact: €183 Mn vs. €16 Mn in H1-2020 and €246 Mn in FY-2020 Impact significantly higher due to: • Dif
Slide 23: H1-2021 rent collection at 89% of due
H1-2021 rent collection at 89% of due(2) H1-2021 collection rates 89% of due(2) Continental 18% Collected Europe UK US 6% 3% Q1 (1) 73% 70% 74% 79% 100% Q2(1) 73% 67% 80% 80% 76% 73% 73% H1(1) 73% 69% 77% 80% o/w due:(2) 89% 87% 94% 92% Invoiced Relief granted Provisioned (3) Remaining Collected ove
Slide 24: Lower bankruptcies in H1-2021
Lower bankruptcies in H1-2021 Bankruptcies down -46% vs. H1-2020 Sector split of bankruptcies: Cont. Europe UK US URW 14% # of stores 152 11 47 210 6% 35% % of total units 2.2% 1.7% 1.2% 1.8% 8% In place 97 8 34 139 Replaced 31 0 5 36 14% In place 84% 73% 83% 83% 23% / replaced Vacant 24 3 8 35 Food
Slide 25: Vacancy levels stabilised in Q2-2021
Vacancy levels stabilised in Q2-2021 14.0% 13.1% 13.4% 12.6% 12.2% 9.7% 9.1% 8.8% 8.9% 8.3% 7.7% 5.4% 5.4% 4.9% 5.0% 2.5% Continental UK US Group Europe FY-2019 vacancy FY-2020 vacancy Q1-2021 vacancy H1-2021 vacancy 2021 HALF YEAR RESULTS 25
Slide 26: Strong pick up of letting activity seen in H1-2021
Strong pick up of letting activity seen in H1-2021 1,218 leases signed +3% vs. H1-2019 +84% vs. H1-2020 1,218 1,185 573 698 757 RENEWALS 663 661 306 555 333 428 361 347 314 365 267 612 LETTINGS/ 451 172 520 189 RELETTINGS 330 300 175 161 125 190 Europe(1) US Group H1-2019 H1-2020 H1-2021 (1) Includi
Slide 27: Leasing performance reflects pragmatic approach to duration
Leasing performance reflects pragmatic approach to duration to protect occupancy and long term value Continental Europe UK US Group 12-36 >36 12-36 >36 12-36 >36 12-36 >36 Total Total Total Total months months months months # deals months months months months MGR Uplift -6.8% +2.2% -2.2% -12.8% -1.3
Slide 28: Offices & Others: NRI impacted by disposals
Offices & Others: NRI impacted by disposals Net Rental Income (€ Mn) H1-2021 H1-2020 Growth Lfl Growth France 19 27 -29.8% 11.8% Nordics 5 5 10.7% 11.3% Others 4 4 8.8% 6.8% US 4 7 -45.4% -40.3% Total 32 42 -23.9% -1.0% 2021 HALF YEAR RESULTS 28 Trinity, La Défense
Slide 29: Convention & Exhibition: challenges as expected
Convention & Exhibition: challenges as expected Restart activity Q4-2021 / Q1-2022 € Mn H1-2021 H1-2020 Change Back to “normal” 2023 Net Rental Income 0 15 -97.1% Paris Olympics From H2-2023 Property Services & Other Income -2 6 -131.9% Strong interest from organisers for 2021-22 Recurring Net Opera
Slide 30: GMV evolution mainly driven by disposals and like-for-like revaluation
GMV evolution mainly driven by disposals and like-for-like revaluation €56,314 Mn +€607 Mn +€561 Mn €54,966 Mn -€1,094 Mn -€22 Mn -€1,400 Mn December 2020 Lfl revaluation Non Lfl revaluation & CAPEX / Disposals Currency Effect June 2021 revaluation of shares Acquisitions / Transfers 2021 HALF YEAR R
Slide 31: Differentiated evolution of like-for-like shopping centre valuation
Differentiated evolution of like-for-like shopping centre valuation Lfl revaluation since Dec 31, 2018(1) -1.3% -1.7% -1.6% -2.0% -2.5% -3.0% -9.1% -8.5% -9.1% -11.8% -12.6% -11.3% -16.6% -15.2% -26.3% -38.7% Continental Europe United Kingdom United States URW (68% of GMV) (6% of GMV) (26% of GMV) R
Slide 32: EPRA NRV evolution
EPRA NRV evolution EPRA Net Reinstatement Value(1) (in € per share) €166.80 +€3.41 €162.40 +€0.67 -€0.84 -€7.64 December 2020 Lfl Asset Revaluation Non Lfl Asset Revaluation Recurring Results Other (3) June 2021 & Intangible Assets (2) (1) Hybrid securities are excluded from NAV (2) Including the re
Slide 33: LTV improving on net debt reduction
LTV improving on net debt reduction 25.0 44.7% 44.4% 45% 43.7% €24.2 €24.2 24.0 €23.5 40% 38.6% €23.0 23.0 22.0 35% (1) 2019 2020 H1-2021 H1-2021 pro-forma Net Financial Debt in Mn EUR IFRS LTV Proportionate LTV: 46.0% or 45.4% pro-forma(1) (vs. 46.3% as at FY-2020) (1) Pro-forma for the receipt of
Slide 34: Credit ratios reflect major impact of COVID-19 rent relief on 2021 EBITDA
Credit ratios reflect major impact of COVID-19 rent relief on 2021 EBITDA Interest cover ratio FFO / NFD Net debt to EBITDA(2) 6.7 16.6 9.7% 14.6 6.1 9.3% 5.9 8.7% 5.7 8.1% 8.8% 4.6 7.8% 10.5 8.5 9.9 4.8% 3.5 3.5 8.5 4.0% 4.3% 2.9 2.0 (waivers obtained(1)) Typical covenant level (1) A waiver of the
Slide 35: Progress achieved on deleveraging plan
Progress achieved on deleveraging plan Objectives (as stated in February 2021) Complete €4.0 Bn Controlled CAPEX Implement programme deployment with European disposal to significantly reduce focused development programme financial exposure pipeline and reduced (2021/2022) to US (2021/2022) cost base
Slide 36: European disposals well advanced and progress made to streamline US portfolio
European disposals well advanced and progress made to streamline US portfolio European disposals US portfolio streamlining Disposals agreed or completed in 2021: Four assets and associated debt exiting the portfolio: €1.7 Bn of €4.0 Bn (42% complete) Debt reduction: €0.3 Bn • €1.1 Bn offices // €0.6
Slide 37: Development pipeline reduction through deliveries
Development pipeline reduction through deliveries €4.4 Bn +€0.1 Bn €3.8 Bn -€0.7 Bn €1.5 Bn €4.4 Bn €2.3 Bn -€1.4 Bn €1.4 Bn €2.3 Bn €1.0 Bn FY-2020 Deliveries Project changes Removed projects H1-2021 Invested to date Remaining net of new Committed(1) Controlled(1) (1) Please refer to the MD&A for d
Slide 38: Favourable credit market access and extended €3.1 Bn sustainability-linked RCF
Favourable credit market access and extended €3.1 Bn sustainability-linked RCF Euro Senior Bonds Revolving credit facility €2.7 Bn cash on hand €650 Mn €3.1 Bn 7-years and 5 months 0.75% 5-years €9.8 Bn undrawn credit facilities Margin linked to the Sustainable Target Score of the Group €2.4 Bn of f
Slide 39: Conclusion
CONCLUSION JEAN-MARIE TRITANT CEO
Slide 40: Cautious optimism and focus on operational and deleveraging plan
Cautious optimism and focus on operational and deleveraging plan June footfall and tenant sales provides cautious optimism for H2-2021 Fully committed to operational and deleveraging plan with further progress in second half No guidance for 2021 given uncertainty over COVID-19 variants and ongoing r
Slide 41: Appendix
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Slide 42: All centres & sectors globally are now open
All centres & sectors globally are now open January February March April May June July May 11 May 31 February 8 April 1 May 3 May 19 April 21 May 6 January 31 May 19 June 9 May 21 June 8 March 15 April 28 June 5 February 1 March 15 May 5 May 28 June 1 April 19 May 17 January 7(2) March 1 May 22 Apri
Slide 43: Upcoming debt refinancing
Upcoming debt refinancing 16.1 2.7 3.2 1.3 2.0 0.9 0-1 Y 1-2 Y 2-3 Y 3-4 Y 4-5 Y >5Y Gross Financial Debt (in € Bn) Nb: URW’s debt profile as at June 30, 2021. On an IFRS basis. Excluding from chart: €1,250 Mn Hybrid NC 2023 and €750 Mn Hybrid NC 2026 treated as equity under IFRS and undrawn facilit
Slide 44: Cost of debt and average debt maturity over time
Cost of debt and average debt maturity over time Average Cost of Debt Average Maturity (years) 3.9% 3.6% 8.4 8.7 3.4% 8.2 EUR (1) USD & GBP 1.4% 3.9% 7.2 7.5 2.9% 7.0 2.6% 6.5 2.2% 5.9 5.4 1.9% 4.9 1.7% 4.5 1.6% 4.3 1.6% 1.4% (1) Including SEK 2021 HALF YEAR RESULTS 44
Slide 45: URW.COM
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