Nepi Rockcastle N.v · JSE:NRP
Nepi Rockcastle — H2 2017 Earnings Presentation
42 slides from Nepi Rockcastle's earnings presentation, December 2017
Slide 1: Results Presentation December 2017
RESULTS PRESENTATION DECEMBER 2017
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Slide 3: NEPI Rockcastle profile
NEPI Rockcastle profile Diverse debt profile, well balanced Leading retail property investment and High-quality dominant retail assets, with a between Eurobond funding, secured and development group in CEE strong tenant base unsecured bank debt NEPI ROCKCASTLE PLC 1 RESULTS PRESENTATION DECEMBER 201
Slide 4: NEPI Rockcastle's achievements in 2017
NEPI Rockcastle's achievements in 2017 Merger of NEPI and Acquisitions Income-producing properties Distribution per share Adjusted NAV Rockcastle and developments weighted by ownership The CEE's leading retail €947m €4.8 bn 17.1% growth 11% growth property investment and 339,800 m2 GLA 1,801,000 m2
Slide 5: Strategy
Strategy Strong strategic positioning oriented towards long-term growth Leading retail business Proven management team and business model • Portfolio of dominant retail assets in high growth CEE markets. • Internally managed business. • Focus on cities with superior macroeconomic qualities. • Abilit
Slide 6: Dominant portfolio by scale and geographical diversification
Dominant portfolio by scale and geographical diversification Primary focus on CEE market with benefits from strong macroeconomic prospects 42+25+1086531 Direct property portfolio* by market value Dec 2017 Romania 42% Hungary 6% Poland 25% Croatia 5% Bulgaria 10% Czech Republic 3% Slovakia 8% Serbia
Slide 7: Well diversified direct portfolio in growing CEE economies
Well diversified direct portfolio in growing CEE economies with exposure to strong economic catchment areas NEPI Rockcastle Property value €4 837m Rentable space 1 801 000m2 Occupancy rate 96.5% Passing rent €328m POLAND SLOVAKIA Property value €1 217m Property value €392m Rentable space 412 400m2 R
Slide 8: Combination of high quality direct portfolio and highly liquid indirect investments
Combination of high quality direct portfolio and highly liquid indirect investments DIRECT PORTFOLIO AT 31 DECEMBER 2017 STRATEGY Weighted Weighted Weighted annualised Occupancy Number GLA Valuation^ Passing rent/ERV % '000m2 €m €m TOTAL PROPERTIES 71 2 116 5 050 345 At 31 December 2017, present in
Slide 9: Finance strategy
Finance strategy Robust balance sheet DEBT MATURITY PROFILE AS AT 31 DECEMBER 2017 (€m) • Versatile funding profile via a combination of equity, debt and sale of the listed securities portfolio. 800 • NEPI Rockcastle investment grade credit ratings: • Baa3, positive outlook - Moody’s • BBB, stable o
Slide 10: NEPI Rockcastle business combination
NEPI Rockcastle business combination • In accordance with IFRS 3 – Business Combinations, the merger between NEPI and Rockcastle was classified as a purchase of Rockcastle by NEPI. • Goodwill of €886 million resulted from Rockcastle’s premium to net asset value at the date of the merger. All assets
Slide 11: Retail operational highlights
Retail operational highlights* Romania Croatia • 9.7% in turnover • 10.9% in turnover • 5.3% in footfall • -0.9% in footfall Poland Czech Republic • 8.0% in turnover • 7.8% in turnover • 1.9% in footfall • 1.3% in footfall Slovakia Serbia • 3.7% in turnover • 8.2% in turnover • -0.9% in footfall • 1
Slide 12: Top 10 retail tenants and contracted gross rent
Top 10 retail tenants and contracted gross rent Sustainable anchor tenant base by rent 4% 3% * 3% ** 3% 3% 2% 1% 1% 1% 1% * Bershka, Massimo Dutti, Oysho, Pull and Bear, Stradivarius and Zara ** Reserved, Cropp Town, House, Mohito, Sinsay Long-term lease duration €m Expiry profile 350 by gross renta
Slide 13: Retail trends: NEPI Rockcastle competitive advantages
Retail trends: NEPI Rockcastle competitive advantages Adaptive retail model for enriching the shopping experience Tenant Mix • Flexibility towards newer “Millennial” concepts like pop-up stores, demo rooms and food halls; • Updates on standard lease agreement based on new omnichannel distribution im
Slide 14: Macroeconomic prospects - future growth prospects in CEE
Macroeconomic prospects - future growth prospects in CEE % Real GDP growth % General gov. debt (% of GDP) 8 100 7 80 6 5 60 4 40 3 2 20 1 0 0 Romania Slovakia Serbia Czech Republic Croatia Poland Bulgaria Hungary EU28 Romania Slovakia Serbia Czech Republic Croatia Poland Bulgaria* Hungary* EU28 CEE
Slide 15: Strong macroeconomic fundamentals and future growth prospects in CEE
Strong macroeconomic fundamentals and future growth prospects in CEE CEE private consumption growth well above the EU average 120% 120% Serbia €25bn 100% 100% Baltic countries 10-year forecasted growth Poland €56bn 80% €273bn 80% Romania €115bn Slovakia 60% Bulgaria Slovenia €47bn €23bn 60% €31bn Hu
Slide 16: Summary of acquisition and developments: completed and ongoing projects
Summary of acquisition and developments: completed and ongoing projects Acquisition drivers Large and dominant shopping centres: Asset manangement initiatives: • Large assets • Cost control of the shopping centre • Large cities • Re-tenanting • With growth potential • Extension and redevelopments Si
Slide 17: Bulgaria
Bulgaria SOFIA PROVINCE (BULGARIA) 1 558 000* INHABITANTS SOFIA CITY 1 324 000 * Sofia Province together with Sofia City St. Alexander Nevsky Cathedral NEPI ROCKCASTLE PLC 15 RESULTS PRESENTATION DECEMBER 2017
Slide 18: A dominant retail position in Bulgaria
A dominant retail position in Bulgaria ACQUISITIONS Serdika Center and Office Paradise Center • The shopping mall is 5-minute drive from Sofia's main motorway and 10 • Paradise Center is the dominant retail scheme in Sofia. minutes from Sofia Airport and from the centre. • Opened in 2013, the centre
Slide 19: Paradise Center
Paradise Center CATCHMENT AREA 5’ - 24 000 15’ - 286 000 30’ - 635 000 NEPI ROCKCASTLE PLC 17 RESULTS PRESENTATION DECEMBER 2017
Slide 20: Hungary
Hungary PEST PROVINCE (HUNGARY) 3 000 000* INHABITANTS BUDAPEST CITY 1 753 000 * Pest Province together with Budapest City NEPI ROCKCASTLE PLC 18 RESULTS PRESENTATION DECEMBER 2017
Slide 21: Strong potential in a new market
Strong potential in a new market ACQUISITIONS Arena Plaza • Centrally located, the shopping mall is the second largest retail centre in Ownership 100% Budapest, enjoying modern layout of two floors, convenient parking and attractive tenant mix. Type Super Regional Mall Lettable area 66 000m2 • In ad
Slide 22: Arena Plaza
Arena Plaza CATCHMENT AREA 5’ - 38 000 15’ - 716 000 30’ - 1 850 000 NEPI ROCKCASTLE PLC 20 RESULTS PRESENTATION DECEMBER 2017
Slide 23: Poland
Poland St. Mary's Basilica, Kraków MALOPOLSKIE DISTRICT PODLASKIE DISTRICT 3 386 000 1 185 000INHABITANTS INHABITANTS KRAKOW CITY BIALYSTOK CITY 767 000 297 000 NEPI ROCKCASTLE PLC 21 RESULTS PRESENTATION DECEMBER 2017
Slide 24: Consolidating the position in Poland
Consolidating the position in Poland ACQUISITIONS Serenada and Krokus Shopping Centres Alfa Bialystok • Acquisition will be effective subject to satisfaction or waiver of a number of • The largest, dominant fashion destination in Bialystok. The city is inhabited conditions precedent, which is expect
Slide 25: Serenada and Krokus Shopping Centres
Serenada and Krokus Shopping Centres CATCHMENT AREA 45’ - 1 373 000 30’ - 821 000 15’ - 336 000 NEPI ROCKCASTLE PLC 23 RESULTS PRESENTATION DECEMBER 2017
Slide 26: Alfa Bialystok
Alfa Bialystok CATCHMENT AREA 45’ - 533 000 30’ - 384 000 15’ - 305 000 NEPI ROCKCASTLE PLC 24 RESULTS PRESENTATION DECEMBER 2017
Slide 27: Plovdiv land, Bulgaria
Plovdiv land, Bulgaria RECENT LAND ACQUISITIONS POSITION ON MAP NEPI ROCKCASTLE PLC 25 RESULTS PRESENTATION DECEMBER 2017
Slide 28: Festival Sibiu land, Romania
Festival Sibiu land, Romania RECENT LAND ACQUISITIONS POSITION ON MAP NEPI ROCKCASTLE PLC 26 RESULTS PRESENTATION DECEMBER 2017
Slide 29: Completed developments
Completed developments Shopping City Ramnicu Valcea Shopping City Galati extension • The Shopping City was opened in December 2017 in Ramnicu Valcea, a city • The extension of 21,000m2 GLA was successfully completed of 119,000 residents. in Q4 2017. • Fit-out is ongoing for a 3D cinema by Cinema Cit
Slide 30: Acquisitions, developments and extensions pipeline
Acquisitions, developments and extensions pipeline ACQUISITIONS PIPELINE (€ MILLION) DEC 2017 )1000( )500( 0 500 1000 1500 2000 Finalised Committed Further opportunities under due dilligence Further opportunities DEVELOPMENTS AND EXTENSIONS PIPELINE (€ MILLION) DEC 2017 )500( 0 500 1000 1500 2000 Fi
Slide 31: Schedule of developments and extensions as at 31 December 2017
Schedule of developments and extensions as at 31 December 2017 CASH BASIS Weighted by ownership Target opening GLA of existing GLA of Cost Total Country Type Category date Ownership property development to date cost % m2 m2 €m €m Developments under construction 41 800 78 200 66 201 Promenada Novi Sa
Slide 32: Promenada Novi Sad - Phase I (Serbia)
Promenada Novi Sad - Phase I (Serbia) DEVELOPMENT UNDER CONSTRUCTION CATCHMENT AREA 45’ - 607 000 30’ - 354 000 15’ - 211 000 VOJVODINA REGION 1 892 000 INHABITANTS NOVI SAD CITY - 319 000 NEPI ROCKCASTLE PLC 30 RESULTS PRESENTATION DECEMBER 2017
Slide 33: Promenada Novi Sad - Phase I (Serbia)
Promenada Novi Sad - Phase I (Serbia) DEVELOPMENT UNDER CONSTRUCTION RENDER • Novi Sad is the second largest city in Serbia, 70 km from the capital, Belgrade, Ownership 100% and is connected by international highways to Budapest, Vienna, Belgrade, Zagreb and Skopje. Estimated lettable area - Phase I
Slide 34: Platan Shopping Centre extension
Platan Shopping Centre extension DEVELOPMENT UNDER CONSTRUCTION RENDER • Extension and redevelopment works, including the construction of a multi- Ownership 100% level car park, started in June 2017. Lettable area - Property in use 22 700m2 • Increase the shopping centre’s GLA to 39,700m2. Estimated
Slide 35: Solaris Shopping Centre extension
Solaris Shopping Centre extension DEVELOPMENT UNDER CONSTRUCTION • The building permit has been received and construction has started to extend Ownership 100% the shopping centre by approximately 9,000m2. Lettable area - Property in use 17 300m2 • The project includes the development of multi-level
Slide 36: Developments under permitting and pre-leasing
Developments under permitting and pre-leasing Shopping City Targu Mures - Phase I, Romania Shopping City Satu Mare, Romania RENDER RENDER • Planned to have two phases of development. • The required permits for the development of a regional dominant retail scheme in Satu Mare were obtained subsequent
Slide 37: Developments under permitting and pre-leasing » continued
Developments under permitting and pre-leasing » continued Arena Centar, Croatia Krusevac & Sabac retail parks, Serbia RENDER RENDER • The extension aims to improve the retail tenant mix and enhance the • 10,500 - 11,700m2 GLA retail parks positioned next to Lidl as food anchor, surrounding area of t
Slide 38: Developments under permitting and pre-leasing » continued
Developments under permitting and pre-leasing » continued Focus Mall Zielona Gora, Poland Shopping City Sibiu, Romania RENDER RENDER • The extension enables the current mall to retain its dominant position in the • Zoning for extension and redevelopment received. city and the region. • The extension
Slide 39: Developments under permitting and pre-leasing » continued
Developments under permitting and pre-leasing » continued Korzo Shopping Centre, Slovakia Aurora Shopping Mall Buzau, Romania RENDER RENDER • The Group is planning a 9,300m2 GLA extension including a redevelopment • The Group will start the development in 2018 and targets opening the of the existing
Slide 40: Conclusions
Conclusions • Share price movement • Strong position in CEE market – dominant retail assets, proven track record and optimal capital structure. • Robust balance sheet and liquidity profile. • Adequate resources for developments and acquisitions including cash, listed securities and revolving facilit
Slide 41: Disclaimer
Disclaimer NEPI Rockcastle plc is a commercial property investor and developer, listed on the Main Board of the Johannesburg Stock Exchange Limited (JSE) and Euronext Amsterdam (AEX). The information in this presentation has been included in good faith but is for general informational purposes only.
Slide 42: NEPI Rockcastle plc Results Presentation December 2017
NEPI ROCKCASTLE PLC 40 RESULTS PRESENTATION DECEMBER 2017