Mercialys Sa · EURONEXT:MERY
Mercialys Sa — Debt Investor Presentation (May 2025)
37 slides from Mercialys Sa's debt investor presentation, May 27, 2025
Slide 1: Bond investor presentation
Bond investor presentation May 27, 2025
Slide 2: Contents
Contents 01 02 03 04 01 Recurrent earnings DNA on a refocused portfolio 02 Strong financial foundations to drive investment 03 Q1 trading update and 2025 outlook 04 FY 2024 Earnings Back-up Recurrent earnings DNA Strong financial foundations Q1 trading update FY 2024 Earnings on a refocused portfoli
Slide 3: Recurrent earnings DNA on a refocused portfolio
01 RECURRENT EARNINGS DNA on a refocused portfolio
Slide 4: Mercialys in a nutshell
Mercialys in a nutshell €169.2m Annualized rental revenues Leading listed French real estate. Pure player for shopping centers and the only European retail property company to 82.0% partner with all the major French food retailers EBITDA margin › Mercialys' portfolio is focused on large and neighbor
Slide 5: Steady progress with our 2030 sustainability roadmap
Steady progress with our 2030 sustainability roadmap, supporting operational efficiency FOR OUR STORES › Asset certification: 100% of strategic assets certified FOR OUR ENVIRONMENT (in line with target) › Carbon neutrality: 13.7 kgCO2eq.sq.m vs. 23.3 kg in 2017 › Responsible retail offering and serv
Slide 6: A trajectory of steadily growing net recurrent earnings
A trajectory of steadily growing net recurrent earnings 3.4% NET RECURRENT EARNINGS CAGR FOR 2021-24 WITH A STRONG FINANCIAL STRUCTURE LTV (1) < 37% maintained over the period 1.21 1.17 1.13 1.10 2021 2022 2023 2024 (1) LTV ratio including transfer taxes NRE in € per share Bond investor presentation
Slide 7: Network built around key French metropolitan cities in major geographical areas
Network built around key French metropolitan cities in 4 major geographical areas 33 STRATEGIC ASSETS => 95% of portfolio value BREST RENNES => 98 % occupancy rate at end-2024 ~25% ANGERS Brittany, Loire-Atlantique CLERMONT- FERRAND ANNEMASSE ~25% SAINT-ETIENNE Rhône-Alpes, GRENOBLE Swiss border 4 T
Slide 8: New food anchors already starting to boost footfall
New food anchors already starting to boost footfall before their upcoming renovations… CUMULATIVE CHANGE IN FOOTFALL CUMULATIVE CHANGE IN FOOTFALL AT END-DECEMBER 2024 (1) AT END-MARCH 2025 (1) (% change vs. FY 2023) (% change vs. Q1 2024) Mercialys +2.7% Mercialys +2.5% +150 bp outperformance +180
Slide 9: A well-balanced rental exposure to food operators
A well-balanced rental exposure to food operators MERCIALYS’ ECONOMIC RENTAL EXPOSURE (1) TO HYPERMARKETS & SUPERMARKETS AT END-2024 5.2% 1.6% 0.2% 0.1% 2.1% 5.6% 1.2% ONGOING OPERATIONAL TRANSITION AND PROJECTS UNDER CONSIDERATION INCORPORATING MID-SIZE STORES (1) Economic exposure corresponds to t
Slide 10: Merchandizing-mix evolution and top-tier brands signed over the last 5 years
Merchandizing-mix evolution and top-tier brands signed over the last 5 years contributing to the leadership of Mercialys’ centers BREAKDOWN AND EVOLUTION OF MERCIALYS’ ANNUALIZED RENTAL INCOME BY BUSINESS SECTOR (%) -220 bp 2020 2021 2022 2023 2024 29.2% -430 bp +300 bp 17.3% +240 bp 19.0% 14.7% +30
Slide 11: OCR driving medium-term reversion potential while supporting low vacancy
OCR driving medium-term reversion potential while supporting the low vacancy rate OCCUPANCY COST RATIO EXCLUDING ANNUAL COLLECTION RATE FOR LARGE FOOD STORES (1) RENTS AND CHARGES 11.1% 97.2% 97.7% 10.9% 10.8% 96.2% 10.7% 2022 2023 H1 2024 2024 Collection of 2023 rents & Collection of 2023 rents & c
Slide 12: Financial vacancy rate at its lowest level since 2019
Financial vacancy rate at its lowest level since 2019, with 2.0% for core assets, close to a frictional level FINANCIAL VACANCY RATE 2.0% AVERAGE VACANCY RATE ON THE 33 CORE ASSETS ACCOUNTING FOR 5.4% 95% OF MERCIALYS’ PORTFOLIO VALUATION 4.9% 4.4% 4.4% 4.1% 95% 1.6% 1.7% 3.2% 1.5% 1.5% 1.2% 0.7% 3.
Slide 13: Strong financial foundations to drive investment
02 STRONG FINANCIAL FOUNDATIONS to drive investment
Slide 14: Sound credit metrics, allowing for capital deployment
Sound credit metrics, allowing for capital deployment STANDARD & POOR’S RATING: BBB / STABLE EXTENSIVE COVENANT HEADROOM AT END-2024 Renewed on October 24, 2024 both on LTV (< 55%) and ICR (> 2x) CHANGE IN NET DEBT / EBITDA CHANGE IN LTV AND ICR 5.9x 5.5x 9.1x 5.0x 5.1x 5.1x 7.6x 38.1% 38.9% 38.2% 3
Slide 15: 2 bond operations achieved in Q3 2024
2 bond operations achieved in Q3 2024, improving the liquidity, maturity and cost of drawn debt Refinancing operations concluded in September 2024, illustrating Mercialys’ smooth access to the market, enabling it to extend its debt maturity (3.8 years at end-2024), while optimizing financing costs 7
Slide 16: Optimized cost of debt, with a significant margin vs. the appraisal yield
Optimized cost of debt, with a significant margin vs. the appraisal yield 2.0% average cost of drawn debt, optimized through the bond operations and a dynamic cash management policy Following the adjustment of appraisal yields over 2020-2024, the spread with the average cost of drawn debt reached 46
Slide 17: Current contemplated transaction
Current contemplated transaction › Mercialys aims to proactively manage the liquidity and upcoming redemption › In this context, the Company is contemplating a new bond issuance with the following indicative characteristics: Indicative terms of the transaction Issuer Mercialys (Ticker: MERYFP, Count
Slide 18: Accretive development pipeline and potential acquisitions
Accretive development pipeline and potential acquisitions TOTAL INVESTMENT STILL COMPLETION (€m) INVESTMENT TO BE SPENT DATE COMMITTED PROJECTS 22.8 22.2 2025/2027 Tertiary activities 21.5 20.9 2027 CONTROLLED PROJECTS 184.4 175.9 2025/2028 Retail 144.2 136.1 2025/2028 Dining and leisure 11.1 11.0 2
Slide 19: Q1 trading update & 2025 outlook
03 Q1 TRADING UPDATE & 2025 OUTLOOK
Slide 20: Q1 2025 trading update
Q1 2025 trading update +2.7% ORGANIC GROWTH IN Q1 (‘000 Euros) Q1 2024 Q1 2025 Lfl growth (%) Current (%) Invoiced rents 45,463 43,761 +2.7% -3,7% Lease rights 82 111 +35.9% Rental revenues 45,545 43,872 -3.7% Solid organic growth in Q1 › Indexation (+2.5% in Q1) continues to play its role as a safe
Slide 21: 2025 target: steady NRE growth profile enabling a balanced dividend return
2025 target: steady NRE growth profile enabling a balanced dividend return NET RECURRENT EARNINGS Ranging from 1.22 € to 1.25 € / share DIVIDEND At least 1.0 € / share ESG Goal of carbon neutrality & continued progress on our strategy Bond investor presentation 21
Slide 22: 2024 Full-Year Earnings Back-up
04 2024 FULL-YEAR EARNINGS BACK-UP
Slide 23: Full impact of the 3rd year of sustained indexation reflected in organic growth
Full impact of the 3rd year of sustained indexation reflected in organic growth Organic growth €178.0m +3.9% €179.5m +0.9% Lease rights +€7.1m €0.0m +€0.5m Lease rights €0.4m €0.5m -€0.8m -€0.3m -€4.9m +0.9% €177.5m €179.2m Rental revenues Acquisitions Strategic vacancy Indexation Contribution Contr
Slide 24: Net recurrent earnings of €113.1m (+3.8%)
Net recurrent earnings of €113.1m (+3.8%), with +3.7% per share, significantly above the +2.0% target €1.17 €1.21 +3.7% /SHARE /SHARE EBITDA margin 82.0% €113.1m +3.8% €109.0m + €1.5m + €1.4m + €2.4m + €2.6m + €0.0m - €0.1m - €3.6m NRE Change in Change in Change in Change in Change in Change Change
Slide 25: Mercialys appraisal yield at 6.65%
Mercialys appraisal yield at 6.65%, offering a ~350 bp spread vs. the risk-free rate Potential yield and EPRA NIY 12/2019 12/2020 12/2021 12/2022 12/2023 06/2024 12/2024 Average appraisal yield rate 5.26% 5.72% 5.71% 5.75% 6.61% 6.68% 6.65% EPRA Net Initial Yield 4.94% 5.28% 5.24% 5.29% 5.97% 6.04%
Slide 26: Stable EPRA NTA and change in EPRA NDV
Stable EPRA NTA and change in EPRA NDV generated by the impacts of fair value of fixed-rate debt and derivatives (2) + €1.22 €17.10 EPRA NDV - €0.04 › €16.45/share (1) €16.45 - €0.57 › Down -0.5% over 6 months - €0.25 - €1.00 › Down -3.8% over 12 months EPRA NRV Rent effect › €18.23/share + €0.96 ›
Slide 27: Appendices
APPENDICES PIERCIALYS
Slide 28: Moving towards carbon neutrality: new carbon trajectory submitted to SBTi
Moving towards carbon neutrality: new carbon trajectory submitted to SBTi for certification A MORE AMBITIOUS CARBON TRAJECTORY FOR MERCIALYS (in kgCO² / sq.m) 30 FORMER TRAJECTORY, certified in 2019, compatible 25 with a temperature increase of less than 2°C 20 15 10 TRAJECTORY REVISED TO ALIGN WITH
Slide 29: Shopping center portfolio structure
Shopping center portfolio structure NUMBER OF SHOPPING CENTERS SHOPPING CENTER BREAKDOWN BY SIZE AND AVERAGE VALUE (% of portfolio gross asset value incl. transfer taxes at Dec. 31, 2024) 73.5 69.9 65.9 62.5 61.5 59.6 17,049 16,570 16,090 16,095 15,867 14,940 6% 3% 3% 4% 4% 4% 58 48 49 48 48 44 32%
Slide 30: Lease expiry schedule effectively staggered over time
Lease expiry schedule effectively staggered over time BREAKDOWN OF MERCIALYS’ LEASE EXPIRY SCHEDULE RENTAL INCOME BY TYPE OF RETAILER CONSOLIDATED VISION (percentage of leases expiring / guaranteed minimum rent (% of annualized rental income at at December 31, 2024) Dec. 31, 2024 and Dec. 31, 2023)
Slide 31: EPRA performance indicators
EPRA performance indicators DECEMBER 31, 2023 JUNE 30, 2024 DECEMBER 31, 2024 EPRA earnings - € per share 1.17 0.63 1.21 EPRA NRV - € per share 18.25 17.80 18.23 EPRA NTA - € per share 16.29 15.85 16.29 EPRA NDV - € per share 17.10 16.53 16.45 EPRA net initial yield - % 5.97% 6.04% 5.93% EPRA “toppe
Slide 32: Net recurrent earnings & EPRA earnings
Net recurrent earnings & EPRA earnings IN THOUSANDS OF EUROS DECEMBER 31, 2023 DECEMBER 31, 2024 Invoiced rents 177,495 179,151 Lease rights 515 384 Rental revenues 178,010 179,534 Property taxes -14,265 -14,531 Rebilling to tenants 12,048 12,153 Non-recovered property taxes -2,217 -2,378 Service ch
Slide 33: Net income attributable to owners of the parent
Net income attributable to owners of the parent IN THOUSANDS OF EUROS DECEMBER 31, 2023 DECEMBER 31, 2024 Net recurrent earnings 108,961 113,129 Depreciation and amortization -38,540 -37,828 Other operating income and expenses -22,447 -7,195 Impact of hedging ineffectiveness, banking default risk an
Slide 34: Balance sheet
Balance sheet IN THOUSANDS OF EUROS DECEMBER 31, 2023 DECEMBER 31, 2024 Intangible assets 3,144 3,424 Property, plant and equipment other than investment property 5,825 7,445 Investment property 1,864,950 1,720,595 Right-of-use assets 10,615 14,784 Investments in associates 39,557 40,315 Other non-c
Slide 35: Breakdown of food retail anchors (owned by Mercialys)
Breakdown of food retail anchors (owned by Mercialys) SITES % OWNERSHIP BY MERCIALYS NEW CURRENT FOOD OPERATOR TRANSFER DATE Annemase 100% Intermarché Apr 30, 2024 Ajaccio 60% Auchan Oct 16, 2024 Angers 51% Auchan May 31, 2024 Besancon 25% Intermarché Oct 15, 2023 Brest 51% Casino Hyperfrais Pending
Slide 36: Breakdown of food retail anchors (not owned by Mercialys)
Breakdown of food retail anchors (not owned by Mercialys) SITES NEW CURRENT FOOD OPERATOR TRANSFER DATE Agen Intermarché Apr 30, 2024 Aix-en-Provence Auchan May 31, 2024 Albertville Intermarché Oct 15, 2023 Angoulême Auchan Apr 30, 2024 Anglet Leclerc Not concerned Annecy Auchan Apr 30, 2024 Arles A
Slide 37: Disclaimer
Disclaimer › This communication contains forward-looking information and statements about Mercialys. Forward-looking statements are statements that are not historical facts. These statements include financial projections and estimates and their underlying assumptions, statements regarding plans, obj