Hammerson plc · LSE:HMSO
Hammerson — FY2019 Earnings Presentation
99 slides from Hammerson's earnings presentation, Feb 25, 2020
Slide 1: 2019 full-year results
2019 full-year results 25 February 2020 Village Noël, Les Terrasses du Port, Marseille
Slide 2: Agenda
Agenda 01 2019 full-year overview 02 2019 full-year financial results 03 Strategic and operational review 04 Conclusion Additional disclosure 2
Slide 3: Full-year overview: Delivering strategic progress in a challenging environment
Full-year overview Delivering strategic progress in a challenging environment Debt reduction target surpassed, retail parks exited Gross proceeds of £975m since January 2019 12 Retail Parks and 75% of Italie Deux Pro forma(1) net debt at £2.4bn (vs target 2019 <£3bn), Gearing 55%, LTV 35%, LTV 42% f
Slide 4: £1bn transacted in the last 12 months
Full-year financial results £1bn transacted in the last 12 months Hammerson annual disposal proceeds (£m) 700 600 500 400 300 200 100 0 (1) (2) 2015 2016 2017 2018 2019 2020 YTD UK flagships UK retail parks UK other France Ireland 1 2 Key disposals: Italie Deux (75%), Dallow Road, Abbotsinch, St Osw
Slide 5: Delivering against strategy in polarising retail market
Full-year overview Delivering against strategy in polarising retail market July 2018 Progress to date Strategic Agenda Capital Efficiency • Delever to mid 30%s LTV • Net debt reduced by a third to £2.4bn • £300m share buybacks • Buybacks programme ended July 2019 • Defer Brent Cross • Brent Cross an
Slide 6: Priorities remain: reduce debt; maintain vibrancy; City Quarters
Full-year overview Priorities remain: reduce debt; maintain vibrancy; City Quarters Key priorities Capital Efficiency • Further cross-portfolio disposals to strengthen balance sheet • Disciplined capital expenditure • Cost control Optimised Portfolio • Diverse portfolio: Flagships; Premium Outlets;
Slide 7: Our Net Positive commitments
Full-year overview Our Net Positive commitments Hammerson set a target in 2015 to be Net Positive for carbon, water, resource-use and socio-economic impacts by 2030 2016 – 2020 2021 – 2025 2026 – 2030 Phase One Phase Two Phase Three Hammerson Hammerson Hammerson, controlled impacts controlled & tena
Slide 8: Significant progress against ambitious targets
Full-year overview Significant progress against ambitious targets FY19 achievements towards Net Positive -12% -12% -7% £900k £1.4m carbon(1) electricity(1) water(1) energy cost savings(2) community investment spend(3) Thassalia project, Les Terrasses du Port PV array, Silverburn 1 2 EPRA LfL Service
Slide 9: 2019 full-year financial results
2019 full-year financial results Victoria Leeds, Leeds
Slide 10: FY headline results
Full-year financial results FY headline results 31 December 2019 31 December 2018 Change Income statement Net rental income (£m) 308.5 347.5 (11.2%) Adjusted profit (£m) 214.0 240.3 (10.9%) Adjusted EPS (p) 28.0 30.6 (8.5%) Total dividend (p) 25.9 25.9 − (2) Balance sheet Portfolio value (£m)(1) 8,3
Slide 11: EPS walk – disposals remain key driver of EPS decline
Full-year financial results EPS walk – disposals remain key driver of EPS decline 2019 EPS walk (pence per share) 30.0 3.1 28.0 0.4 1.5 1.5 26.0 0.5 0.6 30.6 24.0 28.0 22.0 20.0 (1) Dec 2018 Net disposals LfL NRI Net admin Premium outlets Interest FX, tax and other Dec 2019 1 Other includes change i
Slide 12: LfL NRI movements
Full-year financial results LfL NRI movements LfL NRI movements across the portfolio (%) -6.7 FY19 UK Flagships -6.8 H1 -6.6 H2 FY19 2.1 France Flagships H1 0.1 H2 4.2 -5.0 FY19 Ireland Flagships -7.4 H1 -2.6 H2 FY19 -1.4 UK Retail Parks 1.0 H1 -5.5 H2 (1) FY19 10.8 Premium Outlets H1 11.1 H2 10.6 0
Slide 13: Flagships LfL NRI analysis
Full-year financial results Flagships LfL NRI analysis 2019 FY LfL NRI analysis UK flagships France flagships Ireland flagships Tenant restructuring -2.9% -0.5% -3.8% Leasing(1) -1.6% 4.3% 0.4% Void costs -1.9% -1.3% -0.5% Surrender premiums 0.2% -0.2% -1.4% Marketing -0.4% 0.0% 0.0% Car park, comme
Slide 14: Portfolio valuation summary
Full-year financial results Portfolio valuation summary Sector FY 2019 H2 2019 Value at Portfolio capital return(1) capital return(1) 31 Dec 19(2) weighting(2) % % £m % Flagship destinations UK -19.9 -11.9 2,351 28 France -10.2 -6.6 1,270 15 Ireland -7.5 -4.5 860 10 Premium outlets Value Retail +9.5
Slide 15: NAVPS walk
Full-year financial results NAVPS walk 2019 EPRA NAV movement (pence per share) 850 800 26 12 19 750 28 26 738 700 134 650 600 601 550 500 Dec 2018 Adjusted profit Premium outlets Retail parks Fx & other (incl. Dividend Reval deficit Dec 2019 (1) reval impairment loss on disposal) (ex outlets) 1 Inc
Slide 16: Components of valuation change
Full-year financial results Components of valuation change Components of capital return for FY19, total portfolio (%)(1) 7.8% 8.2% 8% 3% 0.6% 0.4% -0.3% -2% -0.5% -0.9% -2.2% -1.4% -1.6% -2.6% -5.5% -5.3% -5.9% -7% -6.7% -7.5% -7.3% -8.1% -7.7% -10.2% -9.8% -12% -11.3% -13.4% -13.6% -17% -19.9% -19.
Slide 17: ERVs reflective of underlying leasing markets since December 2017
Full-year financial results ERVs reflective of underlying leasing markets since December 2017 Two year change in ERVs Dec 2017 – Dec 2019, by unit type(1) (%) • ERVs derived by external valuers to UK France Ireland reflect leasing and market evidence -9.8% -1.2% +4.3% • Largest ERV declines from 10%
Slide 18: Net debt analysis
Full-year financial results Net debt analysis Net debt analysis (£m)(1) 3,400 3,200 536 3,000 2,800 3,406 174 199 2,600 172 428 110 27 37 2,843 2,400 2,415 2,200 Net debt Disposals, net of Net cash inflow Exchange and Value Retail VIA Outlets acqn Capital Dividends Net debt Retail park Pro forma 1 J
Slide 19: Credit ratios
Full-year financial results Credit ratios 31 Dec 2019 31 Dec 2019 31 Dec 2018 (pro forma)(1) Net debt £2,415m £2,843m £3,406m Cash and undrawn facilities £1,638m £1,210m £729m Group debt Internal 31 Dec 2019 31 Dec 2019 31 Dec 2018 covenants guidelines (pro forma)(1) Gearing(2) <150%/175% <85% 55% 6
Slide 20: Debt maturity profile
Full-year financial results Debt maturity profile Debt maturity profile at 31 December 2019 (£m)(1) 900 800 Revolving credit facilities 700 floating linked to IBOR Sterling bonds 600 4.7% wav coupon Private placement 500 2.5% wav coupon Euro bonds 2.0% wav coupon 400 Secured debt 2.1% wav coupon 300
Slide 21: FY20 modelling assumptions
Full-year financial results FY20 modelling assumptions Planning for a challenging but transitional year Indicative 2020 EPS sensitivity to disposals, assuming completion at 30 June, proceeds held as cash: FY20 NRI: Disposals (£m) • UK negative, weaker first half 200 400 600 800 1000 • Ireland positi
Slide 22: Dividend to be rebased in 2020
Full-year financial results Dividend to be rebased in 2020 2019 final dividend of 14.8p (no change), full year dividend of 25.9p (no change) due to: • Confidence in debt reduction • REIT & SIIC tax obligations - therefore 100% PID 2020 dividend to be rebased to a sustainable level • Board adopting p
Slide 23: Strategic and operational review
Strategic and operational review Bullring and Grand Central, Birmingham
Slide 24: Diversity of portfolio agenda
Strategic and operational review Agenda 01 Diversity of portfolio 02 Flagships 03 Premium outlets 04 City Quarters Pavilions, Swords 24
Slide 25: Diverse portfolio of leading pan-European destinations
Diversity of portfolio Diverse portfolio of leading pan-European destinations Portfolio by value(1) FY19 operational statistics Developments 15.0% & UK other(2) (9%) 10.0% 9% 9% 30% 5.0% 0.0% 25% -5.0% 16% 11% -10.0% Premium Outlets (34%) Flagships (57%) Value Retail UK flagships -15.0% France flags
Slide 26: Diverse tenant base
Diversity of portfolio Diverse tenant base(1) Hammerson and peers(2) : % of retail rent accounted for by top 10 tenants 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% (3) (3) UK Peer UK Peer UK Peer UK Peer Hammerson HMSO Euro Peer Euro Peer 1 2 As at 31 December 2019, excluding Retail Parks Peers incl
Slide 27: Flagships
Flagships Skate Southampton, Westquay
Slide 28: Tenant restructuring: managing the challenge since December 2017
Flagships Tenant restructuring: managing the challenge since December 2017 Restructuring impact on rent: Dec17 – Dec19(1) (£m) 149 units 14 Key flagships restructuring stats (two years to December 19): 12 10 • 234 units affected by restructuring 8 (149 units in UK flagships) 44 6 units • 9% of 2,700
Slide 29: Leasing: 70% of flagship leasing at or above previous passing
Flagships Leasing: 70% of flagship leasing at or above previous passing Group, UK, France and Ireland flagship destinations FY19 leasing vs previous passing rent(1) Group Flagships UK France Ireland 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Leases below previous passing Leases in line with previou
Slide 30: Leasing: high street fashion remains most challenged category
Flagships Leasing: high street fashion remains most challenged category UK flagship destinations leasing(1) vs previous passing rent by category - FY19 (£’000s) 200 Type £’000s No. % vs previous 150 passing High street fashion 3,652 34 -36% 100 Non-fashion consumer brands 4,238 56 +9% 50 F&B 1,053 2
Slide 31: Shifting the occupier mix - UK
Flagships Shifting the occupier mix - UK Mix 2019 leasing ERV Rent Category Current Current Future New Renewals Average Average Average of mix mix mix leasing by area across across 2019 by income by area(1) by area by area portfolio portfolio leasing £/sq ft £/sq ft £/sq ft Department stores 6% 38%
Slide 32: Proactive portfolio management: repurposing department stores
Flagships Proactive portfolio management: repurposing department stores Dundrum Ireland’s leading luxury retail House of Fraser store, Brown Thomas, is to open Dundrum, Dublin a flagship store 13,200m2 £14m >12% project forecast cost(1) YOC The Oracle innovative leisure, House of Fraser F&B and flag
Slide 33: Footfall compares favourably with national indices
Flagships Footfall compares favourably with national indices(1) UK– strong polarisation 4% 2% 0% -2% -4% -6% -8% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2018 2019 Cabot Circus Christmas lights switch on Hammerson UK National Index France & Irel
Slide 34: Customer experience and innovation are driving commercial benefits
Flagships Customer experience and innovation are driving commercial benefits Super Events The Maze & Urban Treehouse, Village Noël, Les Terrasses du Port Festival of Light, Dundrum Westquay +11.1% footfall +8.7% footfall +2.7% footfall +13% social media engagement +169% social media engagement +156%
Slide 35: Customer experience and innovation: frictionless parking
Flagships Customer experience and innovation are driving commercial benefits Frictionless parking Family rooms Last mile fulfilment Flexible labour 35
Slide 36: Physical space is key to success of retail brands
Flagships Physical space is key to success of retail brands Higher Drives web conversion traffic and rates than engagement online Cheaper for online fulfilment and returns 36
Slide 37: Physical retail offers competitive acquisition and distribution cost
Flagships Physical retail offers competitive acquisition and distribution cost 50p – 170p 9p – 95p Acquisition Cost per visitor occupancy costs(1) visitor costs(2) In-store conversion rate c.25-50%(3) c.2-4%(4) Acquisition cost per sale(5) £1.00+ £2.25+ Merchant payment cost(2) 1.2% 1.7 - 2.5% Opera
Slide 38: The path towards stabilisation of UK rents
Flagships The path towards stabilisation of UK rents Upward pressures on rents Online rent increasing Physical retail proven to drive awareness and reduce costs Polarisation of footfall and vibrancy Retailers making progress on right-sizing of portfolios Increasing consumer confidence, employment, w
Slide 39: Premium outlets
Premium outlets Hede Fashion Outlet, Gothenburg
Slide 40: 2019 operational update
Premium outlets 2019 operational update Value VIA Premium outlets value creation (£m) Retail(1) Outlets(1) 8 year IRR - 22% Gross Asset Value (£m) 1,966 693 1,800 1,600 Net Asset Value (£m) 1,506 445 1,400 Brand sales growth (%) 9 8 1,200 Footfall growth (%) 5 6 1,000 1,276 (149) 1,711 Average sales
Slide 41: Diverse customer base underpins progressive sales growth
Premium outlets Diverse customer base underpins progressive sales growth 2019 tax free sales (TFS) as a proportion of total sales(1) Value Retail: TFS customers 26% of total sales VIA Outlets: TFS customers 4% of total sales China Brazil China S. Korea Angola Russia 0.6% 9% 0.5% 2% 0.4% 1% Other 2.5
Slide 42: Diverse customer base underpins progressive sales growth
Premium outlets Diverse customer base underpins progressive sales growth Premium outlets sales (€m)(1)(2) 3,500 3,000 2,500 Bird flu 2,000 MERs 1,500 1,000 Swine flu GFC 500 SARS 0 1998 2003 2008 2013 2018 Value Retail VIA Outlets 1 2 The sales figures have been restated at constant FX rates The sal
Slide 43: City Quarters
City Quarters Dublin Central
Slide 44: Beyond retail
City Quarters Beyond retail See slide 99 >100 acres of City Quarters potential 6,600 residential units 1,600 hotel rooms Dundrum Phase 2, Dublin Callowhill Court, Bristol 9 parks and public spaces 300,000m2 work space The Goodsyard, London Dublin Central 44
Slide 45: 2019 progress
City Quarters 2019 progress Martineau Galleries, Birmingham The Podium at Dundrum, Dublin Leeds Hotel, Victoria Planning committee approval Planning committee approval Planning committee approval 7.5 acres 1,300 residential units 107 apartments 205 rooms 130,000m2 of workspace Gym, lounge and terrac
Slide 46: Conclusion
Conclusion Festival of Light, Bullring & Grand Central, Birmingham
Slide 47: Near-term challenging but confident in long-term value creation
Conclusion Near-term will remain challenging but confident in long-term value creation Balance sheet strength Evolve our spaces Beyond retail Reducing debt, repurposing and recycling capital into more Addressing Debt reduction remains diverse prime rental decline - portfolio First City Quarters sche
Slide 48: Questions
Questions Highcross, Leicester
Slide 49: Additional disclosure
Additional disclosure Festival of light, Westquay, Southampton
Slide 50: Contents
Contents 01 Group 02 Net Positive 03 UK flagship destinations 04 France flagship destinations 05 Ireland flagship destinations 06 Premium outlets 07 City Quarters 50
Slide 51: Group
01 Group Bullring & Grand Central, Birmingham
Slide 52: Distinctive market characteristics help explain variation in performance
Additional disclosure: Group Distinctive market characteristics help explain variation in performance UK France Ireland Premium Outlets Macro backdrop ▲ Low unemployment and ▲ Stable consumer outlook ▲ Strong economic growth ▲ Diverse exposure to highly increasing wages ▼ Occasional political unrest
Slide 53: Group statistics
Additional disclosure: Group Group statistics 2019 UK Ireland France Retail Premium parks outlets Occupancy (%) 97 100 97 97 95 Leasing activity (£m) 11 2 6 3 n/a Leasing vs. ERV (%)(1) -8 -2 +5 +1 n/a Leasing vs. previous passing (%)(1) -11 +9 +9 -10 n/a In-store retail sales (%)(2) -2 n/a +3 n/a +
Slide 54: H1 flagships LfL NRI analysis
Additional disclosure: Group H1 flagships LfL NRI analysis H1 2019 LfL NRI analysis UK flagships France flagships Ireland flagships Tenant restructuring -1.8% -1.3% -4.1% Leasing(1) -0.6% 2.2% 1.0% Void costs -1.4% -0.5% Surrender premiums -0.2% -0.7% -2.1% Marketing -0.6% 0.1% Car park, commerciali
Slide 55: 2019 Group leasing performance
Additional disclosure: Group 2019 Group leasing performance cumulative 2019 leasing and cumulative vs 2018(1) (£m) Flagship leasing Dec 19 Dec 18 volumes £m £m 4.0 30 UK 11.2 14.4 3.5 25 France 6.0 7.3 3.0 Ireland 2.1 2.6 20 2.5 Total 19.3 24.3 2.0 15 1.5 10 1.0 5 0.5 0.0 0 March April May August Fe
Slide 56: 2019 portfolio leasing key metrics
Additional disclosure: Group 2019 portfolio leasing key metrics Leasing vs previous Leasing vs ERV Like-for-like ERV New rent secured passing (%)(1) (%)(1) growth from leasing (%) (£m)(2) UK flagships -11.1 -8.1 -8.6 11.2 France flagships 8.3 5.0 -1.9 6.0 Ireland flagships 9.5 -1.5 1.2 2.1 UK retail
Slide 57: Leasing: UK remains most challenging
Additional disclosure: Group Leasing: UK remains most challenging UK, France and Ireland flagship destinations FY19 leasing vs previous passing rent and ERV UK France Ireland % vs previous % vs previous % vs previous Type £’000s % vs ERV £’000s % vs ERV £’000s % vs ERV passing passing passing Princi
Slide 58: Run rate of tenant restructuring in the UK & Ireland
Additional disclosure: Group Run rate of tenant restructuring in the UK & Ireland Units in CVA or administration by month since January 2018 25 20 15 10 5 0 (1) 1 Passing rent of Jan 2020 tenant restructuring £0.4m 58
Slide 59: Tenant restructuring: December 2017 – December 2019
Additional disclosure: Group Tenant restructuring: 31 December 2017 – 31 December 2019 UK France Ireland UK UK Group flagships flagships flagship retail parks other Number of units impacted 149 38 3 27 17 234 Passing rent pre restructuring (£m) 21.6 2.7 1.9 6.3 2.4 34.9 Current passing rent lost – 3
Slide 60: Top tenants exposure
Additional disclosure: Group Top 20 tenants exposure(1) % of % of Rental Rental Retailer passing % of NIA Retailer passing % of NIA Exposure (£m) Exposure (£m) rent rent H&M 8.7 3.4% 1.8% TK Maxx 2.4 0.9% 0.9% Inditex 8.4 3.3% 1.7% Printemps 2.4 0.9% 1.2% Next 4.7 1.8% 1.9% Signet 2.3 0.9% 0.2% Rive
Slide 61: Only one occupier accounts for >2% of group rent from any region
Additional disclosure: Group Only one occupier accounts for >2% of group rent from any region(1) UK France Ireland Rental % of Rental % of Rental % of % of % of % of Retailer exposure passing Retailer exposure passing Retailer exposure passing NIA NIA NIA (£m) rent (£m) rent (£m) rent H&M 5.3 2.06%
Slide 62: OCRs do not reflect store value and are not comparable
Additional disclosure: Group OCRs do not reflect store value and are not comparable between sector, peer or country • A store’s value is not only till sales, but click & collect, returns and driving online sales Do not reflect value • OCRs ignore margin and staff costs which can vary widely by retai
Slide 63: OCRs do not reflect store value and are not comparable
Additional disclosure: Group OCRs do not reflect store value and are not comparable between sector, peer or country OCRs remain consistent across both markets 2018 2019 UK France UK France flagships flagships flagships flagships Rent: sales 13.3% 10.7% 12.7% 10.4% OCR 22.6% 13.7% 22.2% 13.4% • OCRs
Slide 64: 2019 valuation data (NIY)
Additional disclosure: Group 2019 valuation data (NIY) UK France Ireland UK retail UK other Total flagships flagships flagships parks portfolio NIY (%) 31 Dec 2019 5.5 4.1 4.1 7.3 7.4 5.1 30 Jun 2019 5.2 3.8 4.0 6.8 6.0 4.8 31 Dec 2018 4.8 3.7 3.9 6.0 5.7 4.6 Change 6m (pp) 0.3 0.3 0.1 0.5 1.4 0.3 C
Slide 65: 2019 valuation data (ERV)
Additional disclosure: Group 2019 valuation data (ERV) UK France Ireland UK retail UK other Total flagships flagships flagships parks portfolio ERV (£m) 31 Dec 2019 154.5 65.1 42.2 42.5 12.0 316.3 30 Jun 2019 164.0 89.9 45.3 53.9 12.9 366.0 31 Dec 2018 169.3 89.3 45.3 59.7 13.3 376.9 LfL change -6.1
Slide 66: 2019 valuation data (TEY)
Additional disclosure: Group 2019 valuation data (TEY) UK France Ireland UK retail UK other Total flagships flagships flagships parks portfolio True equivalent yield (%) 31 Dec 2019 6.2 4.7 4.7 7.6 9.4 5.8 30 Jun 2019 5.9 4.5 4.6 7.2 8.7 5.5 31 Dec 2018 5.5 4.3 4.5 6.8 8.0 5.3 Change 6m (pp) 0.3 0.2
Slide 67: Widening spreads underpin institutional interest in prime assets
Additional disclosure: Group Widening spreads underpin institutional interest in prime assets Historical NIYs, Hammerson flagships vs 10year gilt/bund 7.00% 6.00% 5.00% 4.00% 3.00% 2.00% 1.00% 0.00% -1.00% Dec-05 Dec-06 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16 Dec-17 Dec
Slide 68: Reconciliation to new EPRA measures as at 31 December 2019
Additional disclosure: Group Reconciliation to new EPRA measures as at 31 December 2019 (£ million) Old metrics Old metrics New metrics(1) NAV NNNAV NRV NTA NTV IFRS NAV 4,377.0 4,377.0 4,377.0 4,377.0 4,377.0 Dilutive share schemes 1.6 1.6 1.6 1.6 1.6 Diluted NAV 4,378.6 4,378.6 4,378.6 4,378.6 4,3
Slide 69: Key disposals achieved 2018 – 2020
Additional disclosure: Group Key disposals achieved 2018 – 2020 NIY Proceeds(1) Buyer (%) £m 2018: Battery Retail Park, Selly Oak 6.0 58 NFU Mutual Wrekin Retail Park, Telford 7.4 35 Ediston/Europa Imperial Retail Park, Bristol/Fife Central Retail Park, Kirkcaldy 7.4 164 Capreon (private equity) Hig
Slide 70: Gearing sensitivity
Additional disclosure: Group Gearing sensitivity(1) Disposals (£m)(3) 0 100 200 300 400 500 600 700 800 900 1000 Reduction in Group 0% 55% 53% 51% 48% 46% 44% 41% 39% 37% 35% 32% 5% 61% 58% 56% 53% 51% 48% 46% 43% 41% 38% 36% values(2) 10% 67% 64% 62% 59% 56% 53% 51% 48% 45% 42% 39% 15% 76% 72% 69%
Slide 71: LTV methodology
Additional disclosure: Group LTV methodology 31 December 2019 31 December 2019 31 December 2018 (pro forma)(1) Headline Fully proportionally Headline Fully proportionally Headline Fully proportionally Net debt (£m) consolidated (£m) (£m) consolidated (£m) (£m) consolidated (£m) Group 2,415 2,415 2,8
Slide 72: Capex and guidance
Additional disclosure: Group Capex and guidance Capex 2019-2021 Committed 2019 2020 2021 Actual Forecast Forecast £m £m £m On-site developments(1) 58 63 35 Other committed capex(2) 7 15 15 Discretionary Flagship destination investment 31 42 60 City Quarters 6 20 20 (3) Total 102 140 130 1 2 Completi
Slide 73: Maintenance capex – FY 2019
Additional disclosure: Group Maintenance capex – FY 2019 UK France Ireland Total flagships flagships flagships Service charge (maintenance) Service charge income (£m) 34 22 13 69 Maintenance expenditure within service charge (£m) 8 4 1 13 Examples: Painting, flooring upkeep, M&E: CCTV, wifi , IT sys
Slide 74: Maintenance capex – FY 2018
Additional disclosure: Group Maintenance capex – FY 2018 UK France Ireland Total flagships flagships flagships Service charge (maintenance) Service charge income (£m) 36 25 12 73 Maintenance expenditure within service charge (£m) 7 4 2 13 Examples: Painting, flooring upkeep, M&E: CCTV, wifi , IT sys
Slide 75: Net Positive
02 Net Positive Declutter to refresh, Cabot Circus, Bristol
Slide 76: FY20 a pivotal year for Net Positive
Additional disclosure: Group FY20 a pivotal year for Net Positive Net Positive carbon emissions (tonnes CO2e) 2015 2019 2020 (1) baseline outcome Forecast (2) 35,000 Carbon 30,500 tonnes CO2e 30,500 12,241 8,600 30,000 27,500 Water M3 (3) 336,000 196,000 152,000 25,400 25,000 Resource use 8,539 3,41
Slide 77: Delivering against our Positive Places Strategy
Our progress against 2019 plans 2019 Target Progress Reducing energy demand across the managed retail portfolio by 12% reduction achieved Delivering a further 11% against our Installing additional renewable electricity capacity at three sites 2 completed 2019, 1 completed Positive Places Jan 2020 St
Slide 78: Hammerson has set a target to be Net Positive
Hammerson has set a target to be Net Positive for carbon, water, resource use and socio- Carbon Resource use economic impacts by 2030 Net Positive for carbon means Net Positive for resource use means waste avoided, recycled carbon emissions or re-used exceeds materials used avoided exceed that are n
Slide 79: UK flagship destinations
03 UK flagship destinations Sensory Gardens, Westquay, Southampton
Slide 80: 2019 UK flagship leasing performance
Additional disclosure: UK flagship destinations 2019 UK flagship leasing performance 2019 UK flagship destinations leasing (£m) 2019 leasing £m 5.0 16 Principal leasing 4.5 8.1 14 Reconfigurations 4.0 12 0.6 3.5 10 Flexible and other 2.5 3.0 2.5 8 Total 11.2 2.0 6 1.5 4 1.0 2 UK flagship leasing key
Slide 81: Differentiation between categories and brands in our UK portfolio
Additional disclosure: UK flagship destinations Differentiation between categories and brands in our UK portfolio 2019 Sales Hammerson UK flagship destinations category sales and range Hammerson -1.8% 50% Index -2.2%(1) 2019 Footfall 40% Hammerson +0.6% Index -4.6%(2) 30% 2019 price deflation(3) 20%
Slide 82: Exposure to department stores
Additional disclosure: UK flagship destinations Exposure to department stores Hammerson exposure to department stores in UK Number of Floorspace Hammerson stores sales growth (‘000 m2) Harvey Nichols 2 8 +ve Selfridges 1 24 John Lewis 5 114 Marks & Spencer 4 28 Fenwick 1 16 Debenhams(1) 5 74 House o
Slide 83: France flagship destinations
04 France flagship destinations Village Noël, Les Terrasses du Port, Marseille
Slide 84: Portfolio remains weighted towards flagship assets
Additional disclosure: France flagship destinations Portfolio remains weighted towards flagship assets Focus on flagship destinations 88% Les Terrasses du Port Italie Deux (25%) Les 3 Fontaines Other Portfolio value: £1.4bn 7 France flagship destinations Largest three assets: 88% of portfolio(1) 1 B
Slide 85: 2019 leasing performance
Additional disclosure: France flagship destinations 2019 leasing performance 2019 leasing and cumulative vs. 2018 (£m) 2019 leasing 5.0 8.0 £m 4.5 Principal leasing 7.0 4.1 4.0 6.0 Reconfigurations 3.5 1.3 5.0 3.0 Flexible and other 0.6 2.5 4.0 Total 2.0 3.0 6.0 1.5 2.0 1.0 France flagship leasing k
Slide 86: Differentiation between categories and brands in France
Additional disclosure: France flagship destinations Differentiation between categories and brands in France 2019 Sales Hammerson UK flagship destinations category sales and range Hammerson +2.6% Index +0.9%(1) 50% 2019 Footfall 40% Hammerson +1.9% Index +0.3%(1) 30% 20% 10% 7.9% 6.4% 5.5% 4.7% 4.5%
Slide 87: Ireland flagship destinations
05 Ireland flagship destinations The Ilac Centre, Dublin
Slide 88: 200,000m2 of prime space plus sustainable development opportunities
Additional disclosure: Ireland flagship destinations 200,000m2 of prime space plus sustainable development opportunities Focus on flagship destinations Dundrum Pavilions Ilac Developments Portfolio value: £1.0bn Dundrum 65% of portfolio(1) 1 By value at 31 December 2019 including developments 88
Slide 89: Key retail centres map
Additional disclosure: Ireland flagship destinations Key retail centres map 89
Slide 90: Premium outlets
06 Premium outlets Mallorca Fashion Outlet, Mallorca
Slide 91: Tiered European outlet market
Additional disclosure: Premium outlets Tiered European outlet market Sales densities €/m2 €30,000+ International fashion and luxury brands €2,000–€10,000 Mainstream fashion brand outlets <€2,000 Low-end discount outlets 91
Slide 92: Premium outlets portfolio
Premium outlets portfolio Value Retail Villages VIA Outlets centres Bicester Village, Oxford Batavia Stad Amsterdam Fashion Outlet GLA: 28,300m2 GLA: 31,000m2 Boutiques: 161 Units: 135 La Roca Village, Barcelona Fashion Arena Prague Outlet GLA: 22,800m2 GLA: 25,600m2 Boutiques: 131 Units: 102 Las Ro
Slide 93: Hammerson's total investment in Value Retail
Additional disclosure: Premium outlets Hammerson’s total investment in Value Retail Holding companies 25% equity Las Rozas La Vallée Maasmechelen Wertheim Ingolstadt Kildare Bicester Village La Roca Village Fidenza Village Village Village Village Village Village Village 37 29 25 14 14 22 33 2 29 50
Slide 94: Absolute sales growth delivered through active management, acquisitions and extensions
Additional disclosure: Premium outlets Absolute sales growth delivered through active management, acquisitions and extensions VR and VIA Sales and Sales Growth 2012 – 2019 (€m)(1) 3,500 14% 13% 13% 12% 3,000 11% 12% 12% 2,500 10% 10% 9% 10% 8% 2,000 8% 8% 8% 8% 7% 1,500 6% 1,000 4% 500 2% 0 0% 2012
Slide 95: Luxury outlets incur higher costs to generate outperformance
Additional disclosure: Premium outlets Luxury outlets incur higher costs to generate outperformance Value Retail – 2019 earnings walk (£m) GRI: 62% fixed, remainder turnover; includes GRI 135.7 brand inducement amortisation Property outgoings (40.6) Property outgoings: includes significant marketing
Slide 96: Lower cost model operated below luxury end of premium outlets market
Additional disclosure: Premium outlets Lower cost model operated below luxury end of premium outlets market VIA Outlets – 2019 earnings walk (£m) GRI: 74% fixed, remainder turnover; includes car GRI 45.6 park income and inducement amortisation Property outgoings (13.8) Property outgoings: includes l
Slide 97: Multi-phase extensions – a source of significant growth
Additional disclosure: Premium outlets Multi-phase extensions – a source of significant growth Completed/Onsite Pipeline 2,600m2 5,500m2 21 units c.27 units TDC TDC €50m €60-65m Opening Opening Q4 2020 Q2 2021 Value Retail: La Roca Village, Barcelona Value Retail: Kildare Village, Dublin 2,400m2 VIA
Slide 98: City Quarters
07 City Quarters Martineau Galleries, Birmingham
Slide 99: The City Quarters opportunity
Additional disclosure: City Quarters The City Quarters opportunity Retail F&B Residential Workspace Leisure Education Culture Hotel Public spaces Next Start on Key schemes Area planning site submission Les 3 Fontaines, Cergy 8,400m2 n/a On site Near term The Podium at Dundrum, Dublin 10,000m2