Merlin Properties Socimi, S.a. · BME:MRL
Merlin Properties Socimi — 6M 2022 Earnings Presentation
37 slides from Merlin Properties Socimi's earnings presentation, Jul 29, 2022
Slide 1: 6M22 Results Presentation
6M22 Results Presentation 29 July 2022
Slide 2: Disclaimer
DISCLAIMER This presentation has been prepared by certain assumptions and estimates. These and, should there be an offering, will not be This presentation may include forward- MERLIN Properties SOCIMI, S.A. (the internal analyses may have not been verified registered under the U.S. Securities Act of
Slide 3: Contents
Contents 6M22 Financial results Offices Logistics ISMAEL CLEMENTE CEO Shopping centers Valuation and debt position Sustainability Value creation Digital Infrastructure Plan MIGUEL OLLERO COO Closing remarks
Slide 4: Key highlights | Overview
Key highlights | Overview Operating performance •G ood performance in all three asset categories with outstanding LfL rental growth (+7.1%) and occupancy at 95.1% (+69 bps vs. PF 3M22) •O ffices delivering excelent operating performance: +5.5% LfL rental increase, +6.3% release spread and 90.4% occu
Slide 5: 6M22 Financial results
~. ISSN 6M22 Financial results
Slide 6: FFO of €0.34 per share, on track to exceed 2022 guidance
6M22 Financial results | FFO OF € 0.34 PER SHARE, ON TRACK TO EXCEED OUR 2022 GUIDANCE (€ 0.58 PER SHARE) (€ million) 6M22 6M21 restated(1) YoY Gross rents 222.6 205.4 +8.3% Gross rents after incentives 209.3 177.0 +18.3% Net rents(2) 186.4 153.1 +21.8% EBITDA(3) 165.8 136.2 +21.7% Margin 74.5% 66.3
Slide 7: GRI bridge: outstanding rental LfL growth
6M22 Financial results | GRI bridge OUTSTANDING RENTAL LFL GROWTH IN THE PERIOD (+7.1%) (€m) +5.5% Offices LfL(1) +9.3% Logistics +7.1% +6.0% Shopping centers +14.0 +3.2 222.6 205.4 6M21 Like-for-Like Balance acquisitions, 6M22 growth disposals & other 7 (1) Portfolio in operation for 6M21 (€ 196.5m
Slide 8: Occupancy and WAULT
6M22 Financial results | Occupancy and WAULT OVERALL OCCUPANCY +69 BPS VS 3M22 PF POST-BBVA DISPOSAL Occupancy and WAULT to first break per asset type(1) +69 bps 99.2% 97.4% 95.1% vs 94.4% @3M22(2) MERLIN 94.3% Average 90.4% 7.6 3.2 years 3.5 3.3 MERLIN 2.2 Average Offices Logistics Shopping centers
Slide 9: Offices
Offices 9
Slide 10: Offices | GRI bridge and breakdown
Offices | GRI bridge and breakdown LFL RENTAL INCREASE (+5.5%) AND RELEASE SPREAD (+6.3%) VS 3M22 LfL(1) (€m) +5.5% 111.5 +5.7 +2.4 119.6 6M21 Like-for-Like growth Balance acquisitions, 6M22 disposals & other LfL growth by area Occupancy by area 3M22 6M22 Madrid +4.9% Madrid 88.0% 87.9% (9 bps) Barc
Slide 11: Offices | Leasing activity
Offices | Leasing activity Contracted sqm #Renewed contracts Release spread Tenants contracted Madrid 36,234 91 +4.5% Barcelona 24,561 44 +10.0% Lisbon 4,912 7 +21.9% Total 65,797 142 +6.3% 11
Slide 12: Offices | Flex space
Offices | Flex space 3 NEW SPACES OPENED THIS SEMESTER AND 3 MORE TO COME BEFORE YEAR-END WHICH WILL IMPLY A 51% INCREASE IN FOOTPRINT KPIs 20,708 sqm 2,176 desks 72% occupancy 10 spaces New openings 2022 Open Atica exp. 155 desks Torre Glòries exp. 87 desks Castellana 93 exp. 69 desks Works ongoing
Slide 13: Logistics
N \ i — i Logistics
Slide 14: Logistics | GRI bridge and breakdown
Logistics | GRI bridge and breakdown FULL OCCUPANCY COUPLED WITH RENTAL GROWTH RESULT IN OUTSTANDING LFL GROWTH (+9.3%) LfL(1) (€m) +9.3% 32.2 +2.9 +0.5 35.6 6M21 Like-for-Like growth Balance acquisitions, 6M22 disposals & other LfL growth by location Occupancy by area 3M22 6M22 Madrid +9.5% Madrid
Slide 15: Logistics | Leasing activity
Logistics | Leasing activity Contracted sqm #Renewed contracts Release spread Tenants contracted Madrid 102,420 6 +3.6% Barcelona 2,725 2 +12.2% Other 47,538 4 - Total 152,683 12 +6.7% 15
Slide 16: Logistics | ZAL Port
Logistics | ZAL Port EXTRAORDINARY PERFORMANCE: FULL OCCUPANCY AND DOUBLE DIGIT FFO INCREASE (+35.2% VS 6M21) Stock 736,384 sqm Third parties stock 183,252 sqm Stock under management 919,636 sqm Tenants Contracted sqm Release spread # contracts 176,434 (1.9%) 38 Occupancy by area 6M21 97.0% +305 6M2
Slide 17: Shopping centers
Shopping centers
Slide 18: Shopping centers | GRI bridge and breakdown
Shopping centers | GRI bridge and breakdown FOOTFALL AND TENANT SALES RECOVERING TO PRE-COVID LEVELS, MAINTAINING OCR AT 12.5% LfL(1) (€m) +6.0% 57.2 +3.4 +0.1 60.7 6M21 Like-for-Like growth Balance acquisitions, 6M22 disposals & other Footfall evolution Tenant sales evolution 6M22 vs 6M21 +30.6% 6M
Slide 19: Shopping centers | Occupancy continues increasing
Shopping centers | GRI bridge and breakdown OCCUPANCY CONTINUES INCREASING FOR THE FIFTH CONSECUTIVE QUARTER Release spread # contracts Tenants All portfolio +5.4% 183 Contracted sqm Net absorption Occupancy 30/06/22 Change vs 31/03/22 (bps) Total 34,698 620 94.3% +4 19
Slide 20: Valuation and debt position
le Valuation and debt position
Slide 21: Valuation and debt position | GAV summary
Valuation and debt position | GAV summary BROADLY STABLE GAV (+1.2% LFL) WITH LOGISTICS DRIVING THE REVALUATION OF THE OVERALL PORTFOLIO Passing 4.1% 5.2% 5.4% - 4.5% 11,390 yield 10,775 6,429 GAV TOTAL with minority stakes (€ million) Shopping centers 2,195 Minority stakes 1,357 Logistics Offices T
Slide 22: Valuation and debt position | GAV drivers
Valuation and debt position | GAV drivers SLIGHT YIELD EXPANSION (+15 BPS) OFFSET BY RENTAL GROWTH +3.6% +1.2% +1.2% GAV MERLIN LIKE-FOR-LIKE average(2) EVOLUTION(1) (0.4%) Offices Logistics Shopping centers +25 +18 +15 bps MERLIN YIELD +10 average (COMPRESSION) / EXPANSION(3) Offices Logistics Shop
Slide 23: Sound financial structure: LTV reduction
Valuation and debt position | Sound financial structure LTV REDUCTION AT ITS BEST AFTER TREE DISPOSAL 30/06/2022 31/12/2021 Net debt € 3,216m € 5,247m 30.4% PF LTV 27.4% post-extraordinary 39.2% dividend Average cost (spot) 1.94% (1.93%) 2.07% (1.76%) Fixed rate debt 99.6% 100% Average maturity (yea
Slide 24: Financial discipline: green, long maturities and fixed rate debt
Valuation and debt position | Sound financial structure FINANCIAL DISCIPLINE: GREEN, LONG MATURITIES AND FIXED RATE DEBT TO NAVIGATE CHALLENGING TIMES 872 872 745 745 602 600 602 531 600 502 531 502 800 302 743 800 302 600 500 600 743 500 1 600 500 2 300 500 600 2 2 2 1 1 2 2 72 2 2 2 2 300 29 2022
Slide 25: Sustainability
Sustainability
Slide 26: Sustainability | 6M22 Milestones
Sustainability | 6M22 MILESTONE INTENSE SEMESTER IN TERMS OF ESG INITIATIVES 3 main milestones achieved this Launching of our semester Pathway to Net Zero 1. Reducing operational carbon Certification program in (scope 1+2) shopping centers completed 2. Reducing embodied carbon (offices & logistics d
Slide 27: Value creation
Value creation
Slide 28: Value creation | BBVA portfolio disposal
Value creation | BBVA portfolio disposal EXCELLENT TIMING IN TERMS OF EXECUTION OF THE TRANSACTION 1 2 3 LTV reduced to 27.4% Rating upgrade € 351m with € 2.1bn of gross perspective Extraordinary Transformational debt repaid dividend event for the € 670m BBVA portfolio Stable to or company mortgage
Slide 29: Value creation | Non-core disposals
Value creation | Non-core disposals DIVESTMENTS AT 8.9% PREMIUM TO LATEST GAV (EXCL. BBVA PORTFOLIO) Offices Sale of 4 office buildings comprising 33,783 sqm (3 periphery and 1 NBA) 29
Slide 30: Future deliveries: Plaza Ruiz Picasso
Value creation | Future deliveries: Plaza Ruiz Picasso THE MOST TECHNOLOGICAL AND SUSTAINABLE ASSET IN THE IBERIAN PENINSULA ns tio et tia -l go e Pr d ne 7% ce 2 an d v n a i 6% +4 GLA Capex Incremental rents Delivery Yield on cost 36,899 sqm € 63.2m € 6.0m 2023 9.2% After Refurbishment 30 5,323 sq
Slide 31: Digital Infrastructure Plan (Mega)
Digital Infrastructure Plan (Mega) 31
Slide 32: Digital Infrastructure Plan | Projects status
Digital Infrastructure Plan | Projects status #Asset License 1st module MW % Pre-let Status Construction Bilbao-Arasur 3 66% works ongoing Advanced Construction Madrid - Getafe 3 negotiations works start on for 53% August 1st Advanced Construction Barcelona - PLZF 3 negotiations works start on for 2
Slide 33: Outlook 2022
Outlook 2022
Slide 34: Outlook 2022 | Guidance
Outlook 2022 | Guidance Extraordinary € 0.75 p.s. dividend To be paid on August 18th Guidance Old New FFO € 0.58 p.s. € 0.60 p.s. Old New Ordinary dividend € 0.40 p.s. € 0.42 p.s. 34
Slide 35: Closing remarks
Closing remarks
Slide 36: Closing remarks
Closing remarks | Operations ERLIN has delivered a strong performance in all key financial and operating metrics (occupancy, LfL rental •M growth, release spread and FFO generation) •O ccupancy continues increasing in all three asset classes (+69 bps vs. PF 31/03/2022) • Inflation favoring financial
Slide 37: Contact
Paseo de la Castellana, 257 28046 Madrid +34 91 769 19 00 info@merlinprop.com www.merlinproperties.com 37
MERLIN Properties SOCIMI — 6M 2022 Earnings Presentation on 6ix