Immobiliare Grande Distribuzione SIIQ S.p.A. · MIL:IGD
Immobiliare Grande Distribuzione SIIQ — IGD SIIQ — FY2019 Earnings Presentation
46 slides from Immobiliare Grande Distribuzione SIIQ's earnings presentation, Feb 27, 2020
Slide 1: 2019 Full Year Results
2019 Full Year Results 27 Febbraio 2020
Slide 2: Disclaimer
Disclaimer This presentation does not constitute an offer or an These statements include financial projections and invitation to subscribe for or purchase any securities. estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect The securities r
Slide 3: 2019: solid foundations for the implementation of the '19-21 Strategic Plan
2019: solid foundations for the implementation of the ‘19-21 Strategic Plan… Restyling/remodeling Work in progress Asset rotation completed Restyling in Casilino and Gran Work re-started in Sale of Palazzo Rondò Officine Storiche Orlando (offices) and purchase of 50% of Restyling and hypermarket the
Slide 4: …and a big step in the realisation of the financial strategy
…and a big step in the realisation of the financial strategy Refinancing 2 new ratings Bond repayment €125 mn BBB – Partial repayment of two From S&P Global Ratings more bonds for an amount of and Fitch Ratings €237.6€ mn New bond issuance €400mn at a record condition for IGD (2.125% coupon) 4
Slide 5: Highlights
Highlights Rental Income Net Rental Income €155.3 mn €136.6 mn +2.3% +10.1% (+1.8% adj ex IFRS16)* Core business Ebitda Funds From Operations (FFO) €125.2 mn €83.3 mn (0.75€ p.s.) +10.1% (+1.0% adj ex IFRS16)* +4.5% Margin: 77.5% Margin from Freehold: 79.7% Proposed dividend 0.50 per share *Adj. ex
Slide 6: Operating Performances
1 Operating Performances
Slide 7: Rental Income
Rental Income (€mn) Total LFL +0.5% +0.3% +3.2% Total Rental Income +€3.5 mn +2.3% €155.3 mn 0.3 0.4 2.8 6.4% 0.6% 25.4% 155.3 151.8 67.6% Rental income FY2018 Change in like-for-like Non like-for-like Italy Change in like-for-like Rental income FY2019 Italy Romania Malls Hyper Romania Other ✓ Incre
Slide 8: Net rental income
Net rental income (€mn) Italy +€2.3 mn +1.9% +€12.6 mn +1.8% Romania +10.1% +2.1% -1,3 10.3 3.5 136.6 124.0 126.3 Net rental income FY2018 Change in rental income Change in rental costs Net rental income IFRS16 Effect Net rental income FY2019 FY_Adj_2019* *2019 adj ex IFRS16 does not consider the ap
Slide 9: Operating performance: trends remain solid…
Operating performance: trends remain solid… 93.6% 6.4% ITALY of tot. rental income ROMANIA of tot. rental income +0.5% Tenant sales +4.0% Average upside** +1.1% Average upside* 97.6% Occupancy 96.9% Occupancy 27.1% Rotation rate*** 5.2% Rotation rate*** *Excluding one renewal in Centro Sarca (multip
Slide 10: …with improving performance during 2019 (focus on Italy)
…with improving performance during 2019 (focus on Italy) Tenant sales and footfalls progressive trends 2019 vs 2018 1Q 2Q 3Q 4Q -0.4% +0.6% +0.5% +1.3% • Footfall trend affected by Tenant sales the negative performance of hypermarkets in which -6.0% +0.7% -1.6% -1.3% remodeling was in progress. (CNC
Slide 11: Recent evolution in Business
Recent evolution in Business Following a good January... +1.4% +1.7% Footfalls Tenant sales We are monitoring the situation as it evolves, in full compliance with the regulations issued …at the end of February by the relevant authorities, both at national the Coronavirus and local level. Furthermore
Slide 12: Invest in order to have high quality occupancy
Invest in order to have high quality occupancy The remodeling of the spaces inside the malls needs to be carried out by renewing the merchandising mix with targeted investments in entertainment, food court and services New attractive brands Entertainment and Services in the food court innovation Fon
Slide 13: A new communication campaign to increase presence in the malls
A new communication campaign to increase presence in the malls Campaign for 7 of IGD’s main shopping centers Shopping center as a place where people can enjoy shopping and entertainment Campaign effects (Jan-Sept ‘19 vs Oct-Dec ‘19) in the shopping centers involved: Δ Footfalls +3.4% Δ Tenant sales
Slide 14: Romania: a growing dynamic context
Romania: a growing dynamic context A more and more attractive and international merchandising mix Effective marketing campaigns New attractive brands Marketing campaigns 4 stores in 2018 New opening of a 115 marketing campaigns in 2019 3 new stores in 2019 medium surface (events, campaigns, exhibiti
Slide 15: 10° year of Sustainability Report
10° year of Sustainability Report Actions carried out/ Priority Main targets Results achieved • Zero CO2 Emissions of Italian portfolio by 2030 -7.1% ENERGY CONSUMPTION LIKE FOR LIKE 2019 VS • BREEAM Certification for 80% of the Italian portfolio by 2018 2030 1 MORE PHOTOVOLTAIC SYSTEM (8 in total)
Slide 16: 10° year of Sustainability Report
10° year of Sustainability Report Actions carried out/ Priority Main targets Results achieved CORPORATE WELFARE FULLY • Training: focus on the soft skills and the importance of OPERATIONAL the interfunctional work group • New work environmental survey between 2020 and 2021 CONTINUATION OF 3 CORPORAT
Slide 17: 10° year of Sustainability Report
10° year of Sustainability Report Actions carried out/ Priority Main targets Results achieved 716 EVENTS HELD IN THE CENTERS • Sustainable enhancement of the portfolio: restyling (13.1% OF WHICH WERE SOCIAL- to be carried out with improvements in ENVIRONMENTAL EVENTS) environmental impact in 10 shop
Slide 18: The Portfolio
2 The Portfolio
Slide 19: A consolidated portfolio
A consolidated portfolio ITALY ROMANIA € 2,412.2mn other 4.1% 19.3 (97.94 €mn) -50.9 € 2,381.4mn Romania 6.4% 6.7 -1.3 2.1 -6.6 other 3.9% (154.79 €mn) (91.99 €mn) Romania 6.3% (150.29 €mn) The change FV is due for approx. 50% to assumptions Malls 65.2% DCF (rates, inflation, erv) and (1,573.77 €mn)
Slide 20: IGD Market value
IGD Market value Gross Initial EPRA Net Initial EPRA Net Initial FY 2018 FY 2019 Δ% Yield Yield Yield topped up Malls Italy 1,573.79 1,555.50 (-1.16%) 6.52% 5.4% 5.5% Hypermarkets Italy 585.63 583.62 (-0.34%) 6.06% Romania 154.79 150.29 (-2.91%) 7.09% 6.1% 6.3% Porta a Mare + development + other 97.
Slide 21: Profound transformation in several shopping centers
Profound transformation in several shopping centers 2 EXAMPLES OF COMPLETED PROJECTS October 2019 November 2019 Casilino Restyling Fonti del Corallo hyper remodelling and restyling Footfalls in the first two Footfalls in the first two months +7.9% months +8.9% Investment €3.7 mn Investment €3.7 mn N
Slide 22: Other on-going projects
Other on-going projects In pipeline 1 Hypermarkets remodeling in line with 2019-2021Strategic Plan 2 Gran Rondò (Crema) – Shopping center restyling and extension 3 La Favorita (Mantova) – Shopping center internal and external restyling centro Hypermarkets Conè, Le Maioliche, The internal restyling o
Slide 23: Porta a Mare: an ambitious multifunctional project
Porta a Mare: an ambitious multifunctional project Molo Mediceo, Lips, Arsenale (Hotel, residential, entertainment and service for the port) Focus next slide Officine Storiche (retail, food court, residential) Work in progress Retail: >15,000 sqm Residential: 43 units Focus next slide Piazza Mazzini
Slide 24: Porta a Mare: Officine Storiche The retail heart of the project
Porta a Mare: Officine Storiche The retail heart of the project Work restarted*: March 2019 End of work: 2H 2020 Total expected investment retail area: € 53 mn (remaining approx. €2 0 mn) Total surface: 20k sqm, of which 15k sqm devoted to retail Stores: 30 + 10 restaurants + 1 fitness center * Foll
Slide 25: Porta a Mare: other areas
Porta a Mare: other areas Molo Mediceo Arsenale Lips: an agreement is being defined for a 4star business hotel; residence with apartments designed for ship crews and student housing Arsenale: possibility of one or more residences Molo Mediceo: services for the touristic port The enhancement and pre-
Slide 26: Financial results
3 Financial results
Slide 27: Core business Ebitda and financial management (€mn)
Core business Ebitda and financial management (€mn) +11.5€mn +1.2€mn Ebitda +10.1% +1.0% 10.3 2.2 -0.3 -0.8 125.2 113.7 114.9 Non recurring charges IFRS9 IFRS16 * Ebitda FY2018 Net rental income Net service income Change in G&A expenses Adj_Ebitda FY_2019 IFRS16 Effect Ebitda FY_2019 Financial manag
Slide 28: Funds From Operations (FFO)
Funds From Operations (FFO) +€3.6mn 1.7 1.5 0.4 79.7 83.3 FFO_2018 Change in core business Adj. Ebitda* Change in Adj. financial Change in taxes and other FFO_2019 management** ACHIEVED +4.5% the guidance announced for the whole year : +4/5% *Change in Adj. Ebitda: is 1.2€mn adjusted of approx. 0.6€
Slide 29: NNNAV
NNNAV € per share FY 2018 FY 2019 Δ% NAV 11.77 11.40 -3.1% NNNAV 11.45 10.92 -4.6% € -0.50 € 0.75 € -0.66 € -0.11 € 11.45 € 10.92 EPRA NNNAV 31 Dec Dividends Change in debt fair value FFO Asset fair value EPRA NNNAV 31 Dec 2018 and other 2019 29
Slide 30: Financial Structure
Financial Structure 31/12/2018* 31/12/2019 The Strategic Plan target is confirmed: LTV 45.8% 47.6% Loan to Value ~ 45% (adj. IFRS16 c. 46.4%) through disposals ICR 3.5X 3.8X**** Average cost of debt 2.65% 2.35% NET DEBT €1,162.6 mn** Debt breakdown*** MARKET SECURED 55.4% 28.9% BANKYNG L.T. SYSTEM 1
Slide 31: Debt maturity
Debt maturity Thanks to the Liability Management activity IGD has already collected funds for the repayment of the 2021 bond and for the general operational management €100mn: 2.25% 7y €400mn: 2.125% 5y 2.1% 5y* 2.65% 7y 500 2.5% 5y 200 154 71 57 67 53 44 6 46 25 27 2020 2021 2022 2023 2024 2025 202
Slide 32: Dividend and Outlook
4 Dividend and Outlook
Slide 33: Proposed dividend
Proposed dividend The Board of Directors resolved to propose to Shareholders’ Meeting* 0.50€ per share Dividend yield (approx. 8.6% based on the closing price at 26 February) Dividend payment date: 6 May 2020 Dps Dps Evolution of total dividend 60 and DPS Dps €0.50 0.55 €0.50 €0.50 50 0.5 Dps 40 Dps
Slide 34: Outlook 2020 c. +2%
Outlook 2020 FY2020 With the committment to GUIDANCE c.+2% give an update together FFO with the 1Q results (7 May) c.+2% +4.5% Funds From Operations +21.4% +21.7% +18.9% +28.5% 35.1 45.3 53.9 65.6 79.7 83.3 2014 2015 2016 2017 2018 2019 2020 34
Slide 35: Agenda
Agenda April 9, 2020 Annual General Meeting (first call) April 22, 2020 10-years anniversary IGD Sustainability Report May 7, 2020 First-Quarter results 2020 August 6, 2020 First-Half results 2020 November 5, 2020 Third-Quarter results 2020 35
Slide 36: Attachments
5 Attachments 36
Slide 37: Consolidated Income Statement
Consolidated Income Statement (a) (b) (c) Δ Δ GROUP CONSOLIDATED FY_CONS_2018 FY_CONS_2019 FY_CONS_Adj_2019* (b)/(a) (c)/(a) Revenues from freehold rental activities 139.3 142.7 142.7 2.4% 2.4% Revenues from leasehold rental activities 12.5 12.6 12.6 0.8% 0.8% Total income from rental activities 151
Slide 38: Funds From Operations (FFO) €83.3mn +4.5%
Funds From Operations (FFO) €83.3mn +4.5% Funds from Operations FY2019 FY2018 Δ vs FY2018 Δ% Core business EBITDA 125,769 113,723 12,047 10.6% IFRS16 Adjustments (Payable Leases) (10,302) - (10,302) n.a. Financial Management Adj (31,384) (32,504) 1,120 -3.4% Extraordinary Management Adj - - - n.a. C
Slide 39: EPRA NNNAV per share
EPRA NNNAV per share 31/12/2018 (a) 31/12/2019 (b) Δ% (b vs a) NNNAV Calculation €'000 p.s. €'000 € p.s. Total number of shares* 110,341,903 110,341,903 1) Group Shareholders' Equity 1,252,338 11.35 1,211,015 10.98 -3.3% Excludes Fair Value of financial instruments 17,364 17,365 n.a Deferred taxes 2
Slide 40: Contracts in Italy and Romania as at 31/12/2019
Contracts in Italy and Romania as at 31/12/2019 N 223 N 226 N 226 N 793 Average residual maturity: 4.34years Malls 63.1% Total contracts: 1,468 of which 138 renewed Italy with the same tenant and 105 signed with 12.1% 13.3% 11.5% a new tenant Rotation Rate 5.2% 2020 2021 2022 >2022 (% new contracts
Slide 41: Key tenants
Key tenants Product Turnover TOP 10 Tenant Contracts Product Turnover category impact TOP 10 Tenant Contracts category impact clothing 2.8% 11 supermarkets 9.0% 11 clothing 2.7% 13 clothing 5.5% 6 shoes 2.2% 9 clothing 3.9% 8 clothing 2.1% 28 Top 10 clothing 3.9% 11 Top 10 clothing 1.9% 10 Tenants T
Slide 42: Further financial highlights
Further financial highlights 31/12/2018* 31/12/2019 Gearing ratio 0.95X 0.88X (adj. IFRS16 c. 0.91X) Average lenght of long term debt 4.3 years 4.1 years Hedging on long term debt + bond 87.6% 94.8% Share of M/L debt 79.8% 94.3% Uncommitted credit lines granted 191 € mn** 161 € mn** Uncommitted cred
Slide 43: Re-classified Balance Sheet
Re-classified Balance Sheet Sources - Uses of funds (€/000) 31/12/2019 31/12/2018 Δ Δ% Fixed assets 2,365,214 2,346,527 -18,687 -0.8% Assets under construction 40,827 36,563 -4,264 -10.4% Other non current assets 21,845 22,699 854 3.9% Other non current liabilities -28,998 -27,906 1,092 -3.8% NWC 18
Slide 44: Investments
Investments CONS 2019 PORTA A MARE PROJECT 6.7 CAPEX ITALY* 19.8 CAPEX ROMANIA 2.1 TOTAL CAPEX 21.9 TOTAL 28.6 ACQUISITION 14.1 TOTAL INVESTMENTS AND CAPEX 42.7 *This value includes other capex for c. 0.5€ mn (which are not included in the real estate portfolio). 44
Slide 45: 2019 real estate sector in Italy and Romania
2019 real estate sector in Italy and Romania Real estate investments by type of format 2019 RECORD Year: Investments €12.3 bn Logistics Other 6% 10% 73% of invested capital came from foreign investors Office 41% Hotel is the asset class that show the highest increase Retail (+141% vs 2018) 16% Retai
Slide 46: Investor Relations contacts
Claudia Contarini, IR T. +39. 051 509213 claudia.contarini@gruppoigd.it Elisa Zanicheli, IR Team T. +39. 051 509242 elisa.zanicheli@gruppoigd.it Federica Pivetti, IR Team T. +39. 051 509260 federica.pivetti@gruppoigd.it Follow us on