Nextensa · EURONEXT:NEXTA
Nextensa — Leasinvest Real Estate — FY2015 Earnings Presentation
50 slides from Nextensa's earnings presentation, Feb 18, 2016
Slide 1: Year Results 2015
YEAR RESULTS 2015 18 February 2016
Slide 2: Agenda
AGENDA Profile & strategy Activity overview Y-T-D Highlights & Key figures Divestments Lettings Redevelopments The real estate market The real estate portfolio Financial report 2015 Evolution of the share Appendices Year results 2015 2
Slide 3: Profile & Strategy
PROFILE & STRATEGY Year results 2015 3
Slide 4: Leasinvest Profile
LEASINVEST PROFILE 5% Fair value direct portfolio 41% 54% € 869 M (2014: € 756 M) Fair value indirect (incl. share Retail Estates) € 940 M (2014: € 808 M) Luxembourg Belgium Switzerland Market capitalization +/-€ 460 M 15,7% Shareholders 42,2% Ackermans & van Haaren 30% 42,1% AXA 29% Free float 41%
Slide 5: Milestones in LRE's Evolution
MILESTONES IN LRE'S EVOLUTION 1999-2005 2006 2008 2012-2013 2014 2015 FOCUS OFFICES LEASINVEST METRO KNAUF SHOPPING RETAIL Tour & BELGIUM IMMO LUX LUX CENTERS LUX CH Taxis BE 1.000 100% 900 90% 800 80% 700 70% 600 60% 500 50% 46,5% 400 40% 38,9% 300 30% 200 20% 14,5% 100 10% 0 0% 2000 2001 2002 2003
Slide 6: Strategy
STRATEGY Investment strategy Development strategy opportunity driven (re-)developments retail & offices generating capital gains & proactive portfolio management ongoing improvement portfolio capital recycling 140 127 70% 120 61% 108 60% 99 100 50% 80 70 38% 67 40% Net investments 60 30% 2007-2015 4
Slide 7: Luxembourg Remains Core
LUXEMBOURG REMAINS CORE • Leasinvest remains the largest real estate investor in Luxembourg • Belgium & Luxembourg have both created good net current results • Luxembourg acquisitions & redevelopments have created sustainable & remarkable capital gains • Buildings in Belgium have lost their capital
Slide 8: Results Since Inception
RESULTS SINCE INCEPTION 60.000 +297% 50.000 40.000 +145% 30.000 +135% 20.000 10.000 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 RENTAL INCOME (€ 1,000) NET CURRENT RESULT (€ 1,000) NET RESULT (€ 1,000) Year results 2015 8
Slide 9: Evolution EPS vs NAV
EVOLUTION EPS VS NAV 85,00 6,00 80,00 5,50 75,00 5,00 70,00 4,50 65,00 4,00 60,00 3,50 55,00 50,00 3,00 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 NAV per share investment value (€) NAV per share fair value (€) NAV per share EPRA (€) EPS (€) Year results 2015 9
Slide 10: Activity Overview
ACTIVITY OVERVIEW Year results 2015 10
Slide 11: Highlights 2015
HIGHLIGHTS 2015 Key figures • slight increase rental income to € 50.5 M • net result of € 30.6 M (2014: € 32.5 M) slightly lower • comparable net current result of € 25.6 M (2014: 26.1 M) Investments & divestments • acquisition of Royal Depot on Tour & Taxis site (December 2015) • public capital inc
Slide 12: Key Figures 2015
KEY FIGURES 2015 Key figures real estate portfolio 31/12/2015 31/12/2014 Fair value real estate portfolio (€ 1,000) 869,361 756,327 Fair value investment properties including participation Retail Estates (€ 1,000) 939,786 808,126 Investment value investment properties (€ 1,000) 886,390 770,680 Renta
Slide 13: Acquisition Royal Depot Tour & Taxis Site
ACQUISITION ROYAL DEPOT TOUR & TAXIS SITE • 100% of the shares of T&T Royal Depot SA (TT) from Extensa Group SA, owner of a leasehold on the emblematic building ‘Royal Depot’ (17/12/2015) and purchase freehold (in Q1 2016) for in total € 108M • originally constructed in 1910, renovated in 2004 into
Slide 14: Maintained Stake in Retail Estates
MAINTAINED STAKE IN RETAIL ESTATES • Retail Estates is a pure retail player with almost € 1 billion portfolio of retail parks & retail warehousing • Leasinvest needs to maintain at least 10% stake for withholding tax reasons (Parent-subsidiary directive) • Leasinvest followed in Q2 2015 capital incr
Slide 15: Divestments in 2015 (1)
DIVESTMENTS IN 2015 (1) Divestments amounting € 24.6 M in 2015: - 03/2015 : Kiem (Luxembourg) for € 6.3 M (building occupied for 20% and not strategic) - 29/06/2015: Canal Logistics Phase 2 (Belgium) for € 16.75 M (building was 100% vacant) - 20/10/2015: Wenenstraat Meer (Belgium) for € 1.5 M (fully
Slide 16: Divestments in 2016 (2)
DIVESTMENTS IN 2016 (2) Divestments amounting € 67 M in 2016: • 27/01/2016: sales & purchase agreement concluded for Zeutestraat Malines (Belgium) for € 4.5 M (to end user) • Q2 2016 : sales agreement ('vente à terme’) for Royal20 for € 62.5 M as of reception - sale is opportunity-driven - 100% pre-
Slide 17: Successful Lettings 2015
SUCCESSFUL LETTINGS 2015 Luxembourg Monnet: Bank Sal. Oppenheim left Monnet office building at Kirchberg (Lux) by 31/12/2014; 100% let with And Bank, China Merchants Bank (for 1 year) & 4 other tenants Strassen & Foetz: Adler Mode for 15 years fixed Knauf shopping centres: Retail remains fully let B
Slide 18: Lux Retail Portfolio
LUX RETAIL PORTFOLIO Schmiede 1 2 Pommerloch 3 Diekirch Hornbach Strassen 4 7 Dudelange 5 Foetz 6 Year results 2015 18
Slide 19: Lux Retail Portfolio
LUX RETAIL PORTFOLIO total GLA shopping centres in Luxembourg = 272,000 m² Knauf SC Schmiede & Pommerloch = 58,479 m² or 21.5% of total Year results 2015 19
Slide 20: Knauf Shopping Centers – Management & Marketing Plan
KNAUF SHOPPING CENTERS – MANAGEMENT & MARKETING PLAN • New logo and marketing plan started • Shopping center consultancy through Cushman & Wakefield (C&W) • New shopping manager hired • Property team will remain insourced • New brands were attracted as: McGregor - AS Adventure - Join Experience (pho
Slide 21: Knauf Shopping Centers Footfall Increases
KNAUF SHOPPING CENTERS FOOTFALL INCREASES • Overall progression of footfall (February-December 2015) for Schmiede +8% and Pommerloch +4.3% • All months the footfall increased versus 2014 except for June & August 2015 • Reasons were that weather conditions and holidays caused a less good record i.e.
Slide 22: Renovation & Letting Monnet = Success
RENOVATION & LETTING MONNET = SUCCESS • building was vacant from 01/2015 and 100% let as from 10/2015 • renovation & technical renovation works (e.g. new airco system) completed in 09/2015 • office project of 3,866 m² • rental price increased from € 28/m²/mth (€ 336/m²/y) to € 32/m²/mth instead (€ 3
Slide 23: Reconstruction Project: Montoyer 63
RECONSTRUCTION PROJECT: MONTOYER 63 BUILDING PERMIT OBTAINED • building vacant: 07/2016 • demolish & fully reconstruct the building • building permit obtained • office project of 6,570 m² • reception by Q4 2017/Q1 2018 • objective = BREAAM ‘excellent’ for reconstruction (2017) • one of few new build
Slide 24: Reconstruction Project: Square de Meeûs
RECONSTRUCTION PROJECT: SQUARE DE MEEÛS BUILDING PERMIT OBTAINED • building vacant as of 07/2015 • demolish & fully reconstruct the building • building permit obtained • office project of 5,936 m² • reception end Q2 2017 • objective = BREAAM ‘excellent’ for reconstruction (2017) • design: Assar Arch
Slide 25: Redevelopment Retail Site Strassen
REDEVELOPMENT RETAIL SITE STRASSEN LARGEST RETAIL PARK IN PERIPHERY • existing Einkaufszentrum Strassen to be refurbished into shopping center with shops & restaurant • retail project of 22,721 m² • in 2 phases in order to take into account the current tenants Adler Mode, Bâtiself and Roller (new re
Slide 26: The Real Estate Market
THE REAL ESTATE MARKET Year results 2015 26
Slide 27: Office Market BELUX: Take-up vs Vacancy
OFFICE MARKET BELUX: TAKE-UP VS VACANCY Belgium Yield bands 700.000 12% 6,6% 11,2% 11,2% 11,1% 10,4% 594.000 9,8% 10,10% 10,30% 600.000 9,70% 10% 6,4% 10,0% 531.000 9,2% 500.000 472.000 469.000 6,2% 411.000 423.000 419.000 8% 400.000 6,0% 350.000 331.000 299.000 6% 5,8% 300.000 4% 5,6% 200.000 5,4%
Slide 28: Evolution Office Market in Luxembourg
EVOLUTION OFFICE MARKET IN LUXEMBOURG Confirmed record year 2015 for investments and lettings Investment market • total investment volume reaches € 1.1 billion, best performance since 2007 • very low speculative pipeline (38,000 m² of 250,000 m² under construction in 2016) • prime yield reaching a r
Slide 29: Evolution Office Market in Brussels
EVOLUTION OFFICE MARKET IN BRUSSELS Investments up to € 1.5 billion, low take-up level but promising start of 2016 Investment market • total investment volume reached € 4.3 billion of which € 1.5 billion in offices! • Prime yield: 5.7% (4.25% for long term leases) Letting market • decreased letting
Slide 30: The Real Estate Portfolio
THE REAL ESTATE PORTFOLIO Year results 2015 30
Slide 31: Consolidated Portfolio Overview
CONSOLIDATED PORTFOLIO OVERVIEW (EXCL. INDIRECT REAL ESTATE) Share Contract 31/12/2015 Investment in ual Rental Rental Occupancy Fair value value Portf. rents yield yield rate Duration (€ M) (€ M) (% FV) (€ M/Y) FV (%) IV (%) (%) (y) Retail Retail Grand Duchy Luxembourg 274.41 277.08 31.56 19.17 6.9
Slide 32: Occupancy Rate at 96%
OCCUPANCY RATE AT 96% • occupancy rate from 96.24% (2014) to 95.96% (calculated without assets held for sale & development projects R20 & Square de Meeûs) • Luxembourg: 97.85% - Belgium: 93.21% - Switzerland: 100% • Retail: 98.79% - Offices: 92.77% - Logistics: 94.91% 100% 99% 98% 97% 96% 95% 94% 93
Slide 33: Rental Duration at 4.84 Years
RENTAL DURATION AT 4.84 YEARS 3% 5% 1% Retail & wholesale • duration rental contracts 4.84 y (2014: 5.08 y) 6% Services - Luxembourg 7.04 y 8% Government & non-profit - Belgium 3.99 y 47% Financial sector 8% - Switzerland 6.07 y Transport & distribution Industry ICT 22% Medical & Pharma Durations 8,
Slide 34: Financial Report 2015
FINANCIAL REPORT 2015 Year results 2015 34
Slide 35: Key Financials 2015
KEY FINANCIALS 2015 31/12/2015 31/12/2014 Rental income (€ M) 50.5 50.2 Net result (€ M) 30.6 32.6 Net current result (€ M) 25.6 26.1 Average funding cost 3.27% 3.63% Average duration credit lines (years) 2.96 3.2 Average duration hedges (years) 6.58 6.13 Year results 2015 35
Slide 36: Comments on Financials 2015
COMMENTS ON FINANCIALS 2015 • Debt ratio temporarily stands at 58.03% in comparison with 54.27% end December 2014. This increase is caused by the acquisition of T&T Royal Depot end December 2015, entirely financed by bank funding. In Q2 2016 the planned sale of the then finalized office building Roy
Slide 37: Comments on Financials 2015
COMMENTS ON FINANCIALS 2015 • Rental income increased by 0.6% to € 50.5 M (2014: € 50.2 M). • Slight increase results mainly from the Swiss retail buildings (acquired in November 2014), that contributed a full year of rent in 2015, and that compensated, the lower rental income from the temporary vac
Slide 38: Financial Strategy
FINANCIAL STRATEGY • funding diversification: 66% banks (9 banks), 34% debt capital markets (17% CP; 18% bonds) • funding cost down to 3.27% (2014: 3.63%) thanks to lower margins & prolonging existing hedging contracts • total committed credit lines (incl. bonds): € 568.7 M (2014: € 543.9 M ) • € 36
Slide 39: Hedging Strategy
HEDGING STRATEGY • hedging strategy historically based on 75% (first 5 years) & 50% (following 5 years) • debt financing at yearend 2015 76% hedged: fixed rate debt (30%), interest rate swaps (31%), interest caps (8%) and cross currency swaps EUR/CHF (7%) • no interest rate floors • duration at 6.58
Slide 40: Outlook Financial Year 2016
OUTLOOK FINANCIAL YEAR 2016 Notwithstanding the expected demolition and reconstruction of 2 buildings in the Brussels CBD in 2016 and except for exceptional circumstances, the company expects, thanks to the acquisition of the Royal Depot at Tour & Taxis, to realize a higher net result and net curren
Slide 41: Evolution of the Share
EVOLUTION OF THE SHARE Year results 2015 41
Slide 42: Share Price at Premium to NAV
SHARE PRICE AT PREMIUM TO NAV 100,00 90,00 80,00 70,00 60,00 50,00 40,00 31/12/2006 31/12/2007 31/12/2008 31/12/2009 31/12/2010 31/12/2011 31/12/2012 31/12/2013 31/12/2014 31/12/2015 Share price LRE NAV LRE (investment value) NAV LRE (fair value) NAV LRE (EPRA) Year results 2015 42
Slide 43: Premium/Discount Evolution
PREMIUM/DISCOUNT EVOLUTION 50% 40% 30% 20% 10% 0% -10% -20% -30% -40% -50% 12/2002 12/2003 12/2004 12/2005 12/2006 12/2007 12/2008 12/2009 12/2010 12/2011 12/2012 12/2013 12/2014 12/2015 Year results 2015 43
Slide 44: Stock Exchange Performance
STOCK EXCHANGE PERFORMANCE • NYSE Euronext Brussels – Bel Small index • member EPRA Eurozone Index • market cap LRE: € 460 million (15 February 2016) 31/12/2015 31/12/2014 Number of listed shares (#) 4,938,870 4,938,870 Number of issued shares (#) 4,938,870 4,938,870 Number of shares entitled to the
Slide 45: LRE Share vs EPRA Indices
LRE SHARE VS EPRA INDICES Leasinvest RE is part of EPRA Belgium Index EPRA Gold Award for annual financial reports 2012, 2013 & 2014 320 280 240 200 160 120 share price LRE EPRA Eurozone Index EPRA Belgium Index 80 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Year resul
Slide 46: Steady Dividend Growth Over the Years
STEADY DIVIDEND GROWTH OVER THE YEARS • gross dividend increased to € 4.70 over 2015 (2014: € 4.55) or +3.3% • net dividend amounts € 3.431 (27% WHT deducted) versus € 3.4215 (25% WHT) • gross dividend yield of 5.05% (31/12/2015) • consolidated pay-out ratio 2015: 90% (2014: 86.5%) 5,000 14,00% 4,50
Slide 47: GPR Share Performance
GPR SHARE PERFORMANCE Year results 2015 47
Slide 48: Analyst Recommendations
ANALYST RECOMMENDATIONS FINANCIAL CALENDAR 2015/2016 Bank Analyst Recommendation Target Date price Degroof Petercam Herman van der Loos Add € 95.00 18/12/2015 KBC Securities Koen Overlaet-Michiels Accumulate € 98.00 15/01/2016 ING Securities Jaap Kuin Hold € 82.00 18/12/2015 Financial calendar 2015/
Slide 49: Investor Relations Contacts
INVESTOR RELATIONS CONTACTS Jean-Louis Appelmans - CEO Michel Van Geyte - COO Piet Vervinckt - CFO Jean-Louis Appelmans is CEO Michel Van Geyte joined Piet Vervinckt joined as CFO of Leasinvest Real Estate Leasinvest Real Estate in Leasinvest Real Estate in (since inception 1999) and of August 2004.
Slide 50: Disclaimer
DISCLAIMER This presentation contains forward-looking statements. Such forward-looking statements involve unknown risks, uncertainties and other factors which may cause the actual results, financial conditions, performance or achievements of the company to be materially different from any future res
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