Wereldhave N.v. · EURONEXT:WHA
Wereldhave — Investor Presentation (May 2020)
42 slides from Wereldhave's investor presentation, May 2020
Slide 1: Company presentation May 2020
Wereldhave Company presentation May 2020
Slide 2: Agenda
Agenda 1 Impact Covid-19 2 Strategy update 3 FY 2019 results 2
Slide 3: Impact of Covid-19
Impact of Covid-19 • Reduced capex obligations by € 75m • Obtained new credit facility Liquidity preservation • Opex and genex reductions • Final dividend 2019 cancelled; no interim dividends will be paid in 2020 • France: Only essential stores open mid-March to May 11th • Belgium: Only essential st
Slide 4: Operations
Operations • Centers closed down Mid-March, essential stores have remained open • Centers reopened May 11th. All stores except for cinema, F&B and leisure can open France • F&B and leisure likely to reopen on June 2 • Centers closed down Mid-March, essential stores have remained open • Centers reope
Slide 5: Liquidity preservation: March 2021 debt maturities covered
Liquidity preservation: March 2021 debt maturities covered • Non-essential capex postponed Reducing capex • Commitments to capex reduced by € 75m • Uncommitted projects put on hold • New green revolving credit facilities for € 100m with maturity of 2 years Improving funding profile • Debt maturities
Slide 6: Covid-19 leads to increased cost awareness
Covid-19 leads to increased cost awareness Capital General expenditures expenditures Operational expenses Temporary Postponing the unemployment development pipeline Service charge Cost saving reduction programme Cleaning, energy Security, technical 6
Slide 7: We have taken measures to prepare for a 1.5 meter economy
We have taken measures to prepare for a 1.5 meter economy Phase 1 Phase 2 Phase 3 Phase 4 Implementation 1.5 meter measures 2020 Timeline Jan – March 2020 March 2020 March – May 2020 11 May – onwards onwards 2. Covid-19 stay at 3. Living the 1.5 4. Recovery and Covid-19 0. Pre- Covid-19 1. Covid-19
Slide 8: Phase 1: Nearly half of the rent-roll caters for everyday life
Phase 1: Nearly half of the Breakdown annualised rent rent-roll caters for everyday Restaurants Leisure 7% life 3% Essential retail 10% Everyday retail 17% Other retail 43% Services 10% Other 1% Healthcare DIY / Garden Drug store 6% 1% 2% Rental income related to everyday life Essential retail: (org
Slide 9: Phase 2 operations: situation March 31, 2020
Phase 2 operations: situation March 31, 2020 March 31, 2020 % of annualized rent 92% Wereldhave generally acts in line with landlord association (CNCC) proposal for differentiated by size of tenants: France 8% Small : April+May rent & service charges postponed Medium: Case-by-case approach Open Clos
Slide 10: Phase 2: Stay safe @home & take care
Phase 2 : Stay safe @home & take care Period > March until May Covid-19 Care Super Buur & delivery Tenant booster Maak Thuis Bijzonder Support neighbours & local heroes promote online & delivery fit @ home, healthy food, kids tips Kids to do top 5 & snack tips Challenge: maak elke dag bijzonder!
Slide 11: We are now in phase 3
We are now in phase 3 • May 11, 2020: All our centers are open 10 Week number 0 • France: All centers reopened on May 11, with all 8 9 10 11 12 13 14 15 16 17 18 19 stores open, except for cinema, F&B and -10 leisure. -20 • Belgium: All centers reopened on May 11, with all stores open, except for F&
Slide 12: Health & Safety protocol COVID-19: example Belgium
Health & Safety protocol COVID-19: example Belgium • Changed parking: structuring entering and departure of the centers • Separated entrance & exit: stickering of routing, also for waiting lines in front of shops. Lifts only with family. • Realtime visitor tracking: 1 visitor per 10 m2 to ensure the
Slide 13: Health & Safety protocol: The Netherlands
Health & Safety protocol: The Netherlands Measures for the common space • Give yourself and others space: maintain 1.5 meters distance to visitors and shop staff • Be sensible: delay your visit if you are have a cold or flu-like symptoms • Higher cleaning levels: for the center and with hygiene stan
Slide 14: Phase 4: Impact Covid-19 on our strategy
Phase 4: Impact Covid-19 on our strategy • Financial position & liquidity becomes first priority • Blueprints under review • Prioritization review, due to differentiated impact on assets of Covid-19 • Shifting preferences in mixed-use from F&B, leisure and entertainment to residential and healthcare
Slide 15: Agenda
Agenda 1 Impact Covid-19 2 Strategy update 3 FY 2019 results 15
Slide 16: First transformation strategy in European Retail Real Estate
First transformation strategy in European Retail Real Estate • First European retail real estate company to transform • Right-size the assets to new reality Actively transform our assets • Restore the retail balance to Full Service Centers • Add new functions & uses • Transform on average 25% of tra
Slide 17: Our strategy in a nutshell
Our strategy in a nutshell Mission Help consumers fulfill all everyday life needs Strategic steps 3 Scale 2 Expand ● Leverage synergies to Transform ● Execute LifeCentral ● Deliver track record (Belle-Ile & Vier Meren) 1 ● Complete 2 degrees roadmaps with aim ● Acquire under-managed assets ● Ensure
Slide 18: LifeCentral: transform shopping centers to FSCs
Wereldhave Strategy LifeCentral: transform shopping centers to 1 2 3 FSCs From Shopping Center… … To Full Service Center Traditional Retail F&B & Entertainment Healthcare, Sports & Wellness Right-size (Fixing the basics & Self (Enjoying life) (Well-being) (e.g. offices or residential) expression) 18
Slide 19: Underwriting the FSC business model
Underwriting the FSC business model Illustrative example Current situation Full Service Centers Rationale 1• Adjusted ERVs: New uses Current ERV (€ Mn) 1 7.0 Current ERV (€ Mn) 1 6.70 generate lower rents 2• Discount rate goes down due to Discount rate 2 6.25% Discount rate 2 5.50% sustainable and l
Slide 20: Measure LifeCentral success through four KPIs
Strategic Implications Measure LifeCentral success through four KPIs KPIs on asset level1 Financial Customer Tenant Retail balance 1 target 2 feedback 3 feedback 4 Unlevered > 6% Customer > 20 Tenant >8 Mixed use > 20% asset IRR NPS satisfaction score2 1. Will only be tracked pre and post transforma
Slide 21: Transform our assets to FSCs through LifeCentral (NL)
Transform our assets to FSCs through LifeCentral (NL) M2 distribution continuing portfolio Right-sizing of multiple over- sized assets by conversion to F&B share in 1,000m2 residential, offices and write-offs total NL portfolio increases from 5% to 10% 26 14 (4%) 60 16 (4%) 5 38 (10%) (7%) 66 (18%
Slide 22: Transform our assets to FSCs through LifeCentral (BE)
Transform our assets to FSCs through LifeCentral (BE) Including increase of M2 distribution continuing portfolio Belle-Ile (11,000), Kortrijk F&B share in 1,000m2 (3,000) and Tournai (400) total BE portfolio and right-sizing Genk (3,642) increases from 8% to 11% 11 + 2 7 21 (12%) 21 (6%) 1918 (11%)(
Slide 23: Phase out France
Phase out France1 1 Lack of scale in French market leads to low bargaining Scale power and relatively expensive Wereldhave organization Use proceeds of phase 2 out to strengthen Large investments are required to convert French Investment need assets to FSCs balance sheet and fund investments in FSCs
Slide 24: Execute LifeCentral only for NL & BE assets with above threshold IRRs
Execute LifeCentral only for NL & BE assets with above threshold IRRs Investment decisions NL & BE assets1 Potential additional value from residential development profits Process reiteration already through Amvest partnership Unlevered IRR comes on top of current IRRs underway to take post- Covid-19
Slide 25: LifeCentral funded by divestments
LifeCentral funded by divestments Targeted divestments Committed capex LifeCentral 2020-2025 € Mn, 2020-2022 € Mn 1,075 38 26 23 1,049 9 15 Book Value H2 ’19 2020 2021 2022 2023 2024 2025 Already sold Targeted Divestments Spent Q1 Committed 25
Slide 26: Breakdown of LifeCentral investments
Breakdown of LifeCentral investments Development capex Total capex 2/3 2020-2025 (€ 300-350m) Examples: Every asset should still ● Belle-Île deliver ● Tilburg inner-city ● Sterrenburg >6% Defensive capex Unlevered 1/3 IRR ● Deferred maintenance Development Defensive ● Larger maintenance projects ● F
Slide 27: Delivering on our ambitions
Delivering on our ambitions Focus on Target 2020-2022 Progress Actions year-to-date Phase out France1 Phase out France Process initiated Divestment program NL / BE Dispose assets with book value of € 225 - € 275 Mn WoensXL disposal finalized in March Liquidity preservation programme Restructuring ba
Slide 28: Final remarks
Final remarks • Strong Q1 performance pre-Covid-19 on footfall and leasing above market rents • LifeCentral already prepared us for transformation: review of plans for the post-Covid- 19 world in progress • All centers of the portfolio now back in business • Dutch market already showing signs of rec
Slide 29: Q&A
Q&A 29
Slide 30: Agenda
Agenda A FY 2019 results B Impact Covid-19 C FY 2019 results 30
Slide 31: Highlights 2019
Highlights 2019 2018 2019 Change Direct result per share1 2.62 2.81 7.3% Indirect result per share1 (2.52) (10.99) 336.1% EPRA NAV per share 43.82 32.99 (24.7%) Dividend per share 2.52 2.52 0.0% Total return per share (3.66) (8.31) 127.0% LTV 37.5% 44.8% +7.3pp NPS N.A. -7 N.A. 1 Continuing operatio
Slide 32: Operations FY 2019
Operations FY 2019 Leasing performance summary # of Leasing MGR Occupany LFL Rent Footfall Country Vs. ERV Contracts Volume Uplift rate Growth growth Belgium 66 10.5% 7.2% 2.4% 96.3% 0.8% 4.9% France 50 9.4% (5.6%) (1.4%) 92.8% (1.0%) 1.1% Netherlands 246 21.2% (6.7%) (1.1%) 95.1% (1.0%) 0.2% Shoppi
Slide 33: Achievements 2019
Achievements 2019 Positive visitor growth in all countries Improving the Customer Journey 12 month change in Visitors 2019 (%) • Restrooms delivered: 6 • Wayfinding delivered: 8 • Parking upgrade delivered: 2 7.6% 6.5% • Play & Relax delivered: 7 4.9% 4.4% 3.4% 1.4% 1.1% 1.1% 1.4% 1.0%1.1% New teams
Slide 34: Achievements 2019
Achievements 2019 Belgian GRESB score Carrefour further improved situations to 91/100 solved Presikhaaf repositioning completed ‘flow by Wereldhave’ services app launched Successful NRW Marketing leasing of all Award spaces of Intertoys Sephora package deal 34
Slide 35: EPRA Earnings (direct result)
EPRA Earnings (direct result) Direct Result Bridge from continuing operations (€ m) +€10.6m €1.2 €128.6 (€0.4) €4.7 €0.6 (€0.7) €5.2 118.0 Actuals NRI Belgium NRI Netherlands NRI France Net Interest General Cost Tax Actuals YTD 2018 YTD 2019 35
Slide 36: EPRA NAV
EPRA NAV NAV Declined mainly due to negative revaluations EPRA NAV Bridge: 2018 to 2019 (€ per share) €43.82 €2.81 (€10.98) (€2.52) (€0.14) €32.99 YE 2018 Direct result Indirect result Dividend FV derivatives YE 2019 and deferred tax 36
Slide 37: Revaluations
Revaluations Negative revaluations in the Netherlands and France Value (€ m) Revaluation 2019 EPRA NIY (%) 2018 2019 €m % 2018 2019 Belgium 862 869 (14) (1.6%) 5.5% 5.6% France 879 806 (88) (9.8%) 4.7% 4.6% Netherlands 1,445 1,139 (343) (23.1%) 5.6% 6.8% Shopping centres 3,186 2,815 (444) (13.6%) 5.
Slide 38: Debt Profile
Debt Profile 2018 2019 Covenants Policy Interest bearing debt1 (€) 1,362m 1,337m Average cost of debt 2.08% 1.89% Undrawn committed (€) 430m 220m Cash position (€) 126m 21m Fixed vs floating debt 97% / 3% 77% / 23% min. 50% fixed LTV 37.5% 44.8% ≤ 60% 30% - 40% ICR 6.2x 6.6x >2.0x >2.0x Solvency 56.
Slide 39: Debt Mix FY 2019
Debt Mix FY 2019 Q4 2018 Q4 2019 Bank loans Bank loans EMTN (incl. RCF) (incl. RCF) 1% 21% 36% Treasury notes 7% • Repayment of € 56m USPP in Convertible bond February 2019 18% € 1,362m € 1,337m EMTN • Repayment of the € 250m convertible 1% Treasury Notes bond in May 2019 3% USPP 57% USPP 56% • Cred
Slide 40: CSR: Long-term Sustainable Value Creation
CSR: Long-term Sustainable Value Creation GRESB Carbon Disclosure BREEAM EPRA sBPR ISS-oekom Five stars Project very good or higher Gold 6th year in a row 2012 - 2019 77% of enclosed 4th year in a row Prime Status centres ESG industry leader 40
Slide 41: CSR framework and SDG targets
90 91 82 82 82 15 16 17 18 19 • • • • • • 1. These are core goals, our CSR framework is based • on SDG targets 7.2, 7.3, 8.8, 11.5, 11.6, 11.7, 11.B, 12.2, 12.5, 13.1, and 17.16 41
Slide 42: CSR: Achievements
CSR: Achievements 100.00% 90.00% 80.00% 70.00% 1% NRI 60.00% 50.00% 2013 2014 2015 2016 2017 2018 2019 2020 kWh/m2/year Target 2020 vs. 2013 -30% • Compared to a 2013 baseline, the • Over 15,000 solar panels installed and • Year on year local involvement with building energy intensity of the current