Unibail-Rodamco-Westfield SE · EURONEXT:URW
Unibail-Rodamco-Westfield — FY2019 Earnings Presentation
62 slides from Unibail-Rodamco-Westfield's earnings presentation, February 2020
Slide 1: 2019 Full-Year Results
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Slide 2: Disclaimer
Disclaimer Unibail-Rodamco-Westfield S.E., a Société Européenne à Directoire et Conseil de Surveillance incorporated under French law, is a listed property investment company. Unibail-Rodamco-Westfield S.E. is listed on Euronext Amsterdam and Euronext Paris. The value of your investment may fluctuat
Slide 3: URW delivers
URW delivers AREPS €12.37 Exceeding guidance DISPOSALS €4.8 Bn (1) ≥ Bookvalue OPERATIONS +3.1% Lfl NRI in Continental Europe TENANT SALES +3.7% Groupwide CSR Extended and recognized (1) Disposals closed since June 2018 and announced disposal of five French assets (2) NB: All terms in this presentat
Slide 4: Financial Results
FINANCIAL RESULTS Mg UNIBAIL-RODAMCO-WESTFIELD
Slide 5: 2019 Full-Year Results
2019 Full-Year Results € Mn FY-2019 FY-2018(1) Growth Lfl Growth Shopping Centres 2,293 1,912 +19.9% +3.1% Offices & Others 103 149 -30.9% -1.2% (2) Convention & Exhibition 95 100 -4.7% +3.4% Net Rental Income 2,491 2,161 +15.3% +3.0% Recurring Net Result (Group share) 1,760 1,610 +9.3% Recurring EP
Slide 6: Continental Europe Highlights
CONTINENTAL EUROPE HIGHLIGHTS
Slide 7: URW's tenant sales growing and outperforming
URW’s tenant sales growing 14.1% and outperforming 3.5% Nordics 3.9% 4.4% 2.2% 3.5% Central Europe 5.2% 5.5% Germany 2.2% 5.4% 0.7% 0.7% 1.6% Shopping Centres Flagships National Sales Austria Indices France 2.5% 1.8% Spain All data YTD November 30, 2019, unless otherwise indicated 2019 FULL-YEAR RES
Slide 8: URW consistently outperforms the market
URW consistently outperforms the market URW cumulative growth: +23.7% Avg NSI cumulative growth: +8.4% +5.2% +4.6% +3.9% +3.0% +2.4% +2.2% +2.2% +2.1% (1) +1.4% +1.6% +1.1% +1.0% +0.5% 2013 2014 2015 2016 2017 2018 2019 -1.4% URW tenant sales Average national sales indices (1) +5.4% including Mall o
Slide 9: Differentiating segments performing very well
Differentiating segments performing very well +211% +7.5% +7.0% Glòries +6.9% +5.1% +2.2% Auto Entertainment Sport Dining Health Fashion & Beauty 39% of 2019 lettings (GLA) Westfield Vélizy 2, Dining Extension All sales data YTD through November 30, 2019 2019 FULL-YEAR RESULTS 9
Slide 10: Driving healthy MGR uplifts
Driving healthy MGR uplifts Leases signed: 1,367 Rotation rate: 10.6% 19.6% 18.2% 17.4% 15.3% 14.7% 13.9% 11.7% 12.0% 2013 2014 2015 2016 2017 2018 2019 2019 Flagships 2019 FULL-YEAR RESULTS 10
Slide 11: Delivering solid retail Lfl NRI growth
Delivering solid retail Lfl NRI growth Net Rental Income (€ Mn) FY-2019 FY-2018(1) Growth Lfl Growth France 663 647 +2.5% +2.8% Central Europe 223 212 +5.4% +4.0% Spain 157 155 +0.8% +10.5% Nordics 123 141 -13.3% -2.6% Austria 111 108 +3.5% +2.5% Germany 143 140 +2.8% +0.0% The Netherlands 62 59 +5.
Slide 12: UK & US Activity Withstanding Challenging Markets
UK & US ACTIVITY WITHSTANDING CHALLENGING MARKETS
Slide 13: Operating metrics UK
Operating metrics UK FY-2019 FY-2018 Tenant Sales +4.7% +2.8% Footfall +2.8% +6.1% MGR Uplift +11.1% +19.8% Lfl NRI -4.2% +3.4% EPRA Vacancy 7.7% 7.4% Westfield Stratford City 2019 FULL-YEAR RESULTS 13
Slide 14: Making progress in a tough market
Making progress in a tough market YTD Nov. 30, vs. national 2019 average (bps) Tenant Sales +5.3% +550 Footfall +3.4% +530 EPRA occupancy FY-2018 HY-2019 FY-2019 89.5% 88.3% 89.2% 96.7% 95.0% 96.0% Westfield London 2019 FULL-YEAR RESULTS 14
Slide 15: Operating metrics US
Operating metrics US Specialty Sales Sales psf Comp NOI Growth (%) Occupancy (%) Rental Spreads (%) Growth (%) (1) Growth (%)(2) FY-2019 FY-2018 FY-2019 FY-2018 FY-2019 FY-2018 FY-2019 FY-2019 US +2.4 -1.6 94.8 95.6 +1.6 +7.5 +1.6 +5.1 Flagships +5.4 -0.3 96.2 96.2 +4.7 +11.5 +3.2 +4.3 Regionals -6.
Slide 16: Key US take-aways of June 2019 IR Days
Key US take-aways of June 2019 IR Days URW US not a proxy Foundation of an effective Clear short, mid, and long- for the market organization in place term business objectives Small number of assets New governance structure Starting 2nd round of 5-Year BP to fine-tune 70% of GLA in A malls Operating
Slide 17: US: implementing our clear plans
US: implementing our clear plans Reinforcing leasing to improve occupancy 91% 95% 92% 96% Honey Birdette Javier’s Bake Cheese Tart Dyson Hermès Kate Spade Del Frisco’s Happy Socks 2019 FULL-YEAR RESULTS 17
Slide 18: US: implementing our clear plans
US: implementing our clear plans Proactively re-tenanting to improve the mix GLA signed in 2019(1) Total change in GLA 2013-2019(2) 18.9% +34.6% +28.0% 11.9% +22.5% 5.3% Fashion Dining Entertainment Health & Dining Entertainment Health & Wellness Wellness -12.5% Strategic categories: 36% of GLA sign
Slide 19: US: implementing our clear plans
US: implementing our clear plans Transforming big-boxes Pre-letting(1) 100% TIC Delivered Pre-letting(1) 100% TIC Delivery 99% €50 Mn H2-2019 50% €240 Mn H2-2021 Before After Before After (1) Pre-letting: GLA signed, all agreed to be signed and financials agreed 2019 FULL-YEAR RESULTS 19
Slide 20: US: implementing our clear plans
US: implementing our clear plans Deliveries # of apartments Delivered URW ownership GLA Delivery URW ownership 100% TIC Pre-Letting(1) 300 H2-2019 50% +46,700 sqm H1-2020 50% €1,050 Mn 80% Palisade at Westfield UTC Westfield Valley Fair (1) Pre-letting: GLA signed, all agreed to be signed and financ
Slide 21: We are executing on our regional mall plans
We are executing on our regional mall plans 2019 FULL-YEAR RESULTS 21
Slide 22: Standing Out in the Retail (R)evolution
STANDING OUT IN THE RETAIL (R)EVOLUTION
Slide 23: Leveraging 1.2 billion annual visits
Leveraging 1.2 billion annual visits URW’s mission: "Reinvent being together" Westfield Parly 2, Aya Nakamura Westfield Les 4 Temps, John Legend Westfield World Trade Center, Christmas market CentrO, NFL event Westfield Rosny 2, Kendji Girac Westfield Mall of Scandinavia, Rita Ora Westfield Century
Slide 24: All retail is not equal…
All retail is not equal… Highest footfall locations Best catchment areas Best connected locations Constant reinvention NB: Please see June 2019 Investor Days presentations for references, available at www.urw.com/investordays 2019 FULL-YEAR RESULTS 24
Slide 25: Retail is about retailers
Retail is about retailers 2,621 leases signed 803,500 sqm €432 Mn MGR Westfield UTC, Under Armour 1,157 re-lettings 293,300 sqm €201 Mn MGR o/w with increased GLA 36,000 sqm €30 Mn MGR Westfield Les 4 Temps NB: Data shown reflects leasing for the Group (inc US and UK) in 2019. Sqm refers to GLA. MGR
Slide 26: Expanding key categories: Dining and Entertainment
Expanding key categories: Dining and Entertainment Signed New stores opened 160,400 sqm 98,300 sqm Westfield Vélizy 2, UGC Ciné Cité CentrO, dining area Westfield Valley Fair, Icon cinema Westfield London, food court NB: Leasing for the Group in GLA. Signed = renewals and new lettings 2019 FULL-YEAR
Slide 27: Expanding key categories: Sport, Health & Beauty
Expanding key categories: Sport, Health & Beauty Signed New stores opened 102,000 sqm 43,400 sqm Westfield Century City CentrO Westfield Stratford City, JD Sports, +3,100 sqm Westfield London NB: Leasing for the Group in GLA. Signed = renewals and new lettings 2019 FULL-YEAR RESULTS 27
Slide 28: Expanding key categories: DNVBs
Expanding key categories: DNVBs Signed New stores opened 8,100 sqm 5,900 sqm Westfield San Francisco Centre Westfield London Westfield Topanga Westfield Garden State Plaza NB: Leasing for the Group in GLA. Signed = renewals and new lettings 2019 FULL-YEAR RESULTS 28
Slide 29: Expanding key Fashion retailers
Expanding key Fashion retailers Signed New stores opened 296,200 sqm 69,100 sqm Westfield London Stadshart Amstelveen Westfield Les 4 Temps Westfield Forum des Halles NB: Leasing for the Group in GLA. Signed = renewals and new lettings 2019 FULL-YEAR RESULTS 29
Slide 30: New revenues: brand events & commercial partnerships
New revenues: brand events & commercial partnerships 2019 Total Group Continental Europe €118 Mn +11.2% CentrO, Christmas market Westfield London, Samsung Galaxy kiosk Westfield Les 4 Temps, digital screens Westfield World Trade Center, Gucci kiosk 2019 FULL-YEAR RESULTS 30
Slide 31: Retailer failures are proactively managed and relet
Retailer failures are proactively managed and relet Cont. Europe UK US URW # of stores 203 50 195 448 Trading - no rent cut 88 20 74 182 Trading - rent cut 17 11 20 48 Replaced 56 5 35 96 Trading or replaced 79% 72% 66% 73% Vacant 42 14 66 122 Annualized potential exposure: 3.2% of Group retail MGR
Slide 32: Office and C&E
OFFICE AND C&E Mg UNIBAIL-RODAMCO-WESTFIELD
Slide 33: Offices & Others: results reflect disposals
Offices & Others: results reflect disposals Net Rental Income (€ Mn) FY-2019 FY-2018(1) Growth Lfl Growth France 72 124 -41.8% -1.5% Nordics 10 11 -9.0% -6.1% Others 7 6 +33.2% +11.4% US 13 8 n.m. n.a. Total 103 149 -30.9% -1.2% Shift, Issy-les-Moulineaux (1) FY-2018 is restated to include the NRI o
Slide 34: Convention & Exhibition: an excellent year
Convention & Exhibition: an excellent year Growth Growth (1) (1) € Mn FY-2019 FY-2018 2019/2018 FY-2017 2019/2017 Net Rental 95 100 -4.7% 91 +4.7% Income Paris Le Bourget, Paris Air Show, 316,000 visitors Property Services 62 65 -4.8% 50 +23.6% & Other Income Recurring Net Operating 157 165 -4.8% 14
Slide 35: Convention & Exhibition: building the future
Convention & Exhibition: building the future A congress venue recognized globally Delivery of new venue & hotels Paris Convention Centre, European Society of Cardiology and the World Heart Federation Paris Porte de Versailles, New Pavilion 6 Paris Porte de Versailles, Novotel # of congresses st 96 (
Slide 36: Leading on Sustainability
LEADING ON SUSTAINABILITY Mg UNIBAIL-RODAMCO-WESTFIELD
Slide 37: Extending the Group's CSR programme
Extending the Group’s CSR programme REINVENTING PLACES TOGETHER FOR A BETTER TOMORROW Reaffirmed carbon ambition, incl. scope 3(1) -50% Extended reach and commitment All regions of the Group (incl. US & UK) Responsible consumption Circular economy New challenges Biodiversity Community resilience (1)
Slide 38: URW: a leader in CSR
URW: a leader in CSR st (1) 1 AAA A Prime C+ (1) First among all listed retail real estate companies worldwide 2019 FULL-YEAR RESULTS 38
Slide 39: Pipeline: Flexible, Focused and Diversified
PIPELINE: FLEXIBLE, FOCUSED AND DIVERSIFIED
Slide 40: URW pipeline: flexible…
URW pipeline: flexible… €11.9 Bn -€0.4 Bn €8.3 Bn -€3.2 Bn €5.5 Bn €5.6 Bn -€2.8 Bn €4.5 Bn €2.7 Bn €1.0 Bn FY-2018 Deliveries, changes Removed projects FY-2019 Invested to date Remaining & additions Committed(1) Controlled(1) (1) Please refer to the MD&A for definition 2019 FULL-YEAR RESULTS 40
Slide 41: … focused on value creation…
… focused on value creation… €3.2 Bn of projects removed from the pipeline Require major redefinition URW continues to review or alternatives, in line with: Are postponed significantly due Capital allocation priorities to market or administrative circumstances Return objectives or Mixed-use strategy
Slide 42: … and diversified towards mixed-use
… and diversified towards mixed-use Dining & leisure greenfield / brownfield 10% Dining & leisure Retail ext / ext / renovation renovation 7% 19% Westfield Hamburg 43% Offices Retail 1.4 million sqm 21% Retail greenfield / brownfield Hotels 24% 8% Residential 11% Westfield Montgomery 2019 FULL-YEAR
Slide 43: Deliveries: a remarkable 2020
Deliveries: a remarkable 2020 €2 Bn of deliveries: +268,100 sqm / YoC: 6.2% 2020 Montparnasse LA PART-DIEU GLA Delivered GLA Delivery from GLA Delivery GLA Delivery GLA Delivery GLA Delivery 46,700 sqm H2-2019 +46,700 sqm H1-2020 49,500 sqm H1-2020 51,300 sqm H2-2020 +33,400 sqm H2-2020 +87,200 sqm
Slide 44: Synergies
SYNERGIES Mg UNIBAIL-RODAMCO-WESTFIELD
Slide 45: Synergies
Synergies Commercial Partnerships Target (run rate) +11.2% in Continental Europe €100 Mn(1) Achieved €99.0 Mn Cost Revenue(2) €87.9 Mn €11.1 Mn Westfield Vélizy 2, digital screen CentrO, Sephora event (1) €60 Mn in cost synergies and €40 Mn in revenue synergies (2) Phased-in 2019 FULL-YEAR RESULTS 4
Slide 46: €4.8 Bn of Disposals at Premium to Book Value
€4.8 BN OF DISPOSALS AT PREMIUM TO BOOK VALUE
Slide 47: Disposal of 54.2% interest in €2.0 Bn retail portfolio
Disposal of 54.2% interest in €2.0 Bn retail portfolio Aéroville So Ouest Rennes Alma Toison d’Or Confluence GLA GLA GLA GLA GLA 84,900 sqm 56,900 sqm 46,500 sqm 78,700 sqm 53,800 sqm Footfall 2019 Footfall 2019 Footfall 2019 Footfall 2019 Footfall 2019 9.2 Mn 7.6 Mn 7.2 Mn 8.3 Mn 10.2 Mn Portfolio
Slide 48: Disposal of 54.2% interest in €2.0 Bn retail portfolio
Disposal of 54.2% interest in €2.0 Bn retail portfolio Transaction details Equity – 50% URW Accounting treatment: Equity method 54.2% 45.8% Debt – 50% Targeted closing: (2) Non-recourse Q2-2020 JV Fully underwritten URW asset & property manager(1) URW NDP : €1,511 Mn (3) Rennes Aéroville So Ouest To
Slide 49: €4.8 Bn of disposals made or agreed since June 2018
€4.8 Bn of disposals made or agreed since June 2018 July & August 2018 December 2018 H1-2019 H2-2019 February 2020(1) Capital 8 Tour Ariane Jumbo Majunga Aéroville Horton Plaza Lumen & Skylight Cherry Park Ring Center So Ouest Los Arcos Rennes Alma Bahia Sur Toison d’Or Vallsur Confluence El Faro Of
Slide 50: Financing at Attractive Conditions
FINANCING AT ATTRACTIVE CONDITIONS
Slide 51: €4.6 Bn of long-term capital raised at attractive rates
€4.6 Bn(1) of long-term capital raised at attractive rates Secured GBP Bond Euro Senior Bonds 144A USD Bonds Westfield Stratford City February June/July June July 8-year 30-year 10-year 7-year €750 Mn €500 Mn $750 Mn £750 Mn (2) 1.0% 1.75% 3.5% 1.64% October October st (3) 1 15-year 12-year 7-year €
Slide 52: Low cost of debt and record average maturity
Low cost of debt and record average maturity Average Cost of Debt Average Maturity (years) 3.9% 8.2 3.6% 7.5 3.4% 7.2 EUR (1) USD & GBP 7.0 0.9% 3.4% 2.9% 6.5 2.6% 5.9 2.2% 5.4 4.9 4.5 4.3 1.6% 1.6% 1.6% 1.4% 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2010 2011 2012 2013 2014 2015 2016 2017 2
Slide 53: Balance Sheet & NAV
BALANCE SHEET & NAV Mg UNIBAIL-RODAMCO-WESTFIELD
Slide 54: Healthy credit ratios
Healthy credit ratios LTV ICR 60% 6.1 41% 5.9 41% 5.7x 40% 38.6% 4.6 4.6 30% 37% 33% 4.0 3.8 3.5 30% 2.5 3.5 25% 2.0 37.2% Typical covenant level Pro-forma for disposal The debt the Group expects to raise over of five French assets Target range the next 2 years is fully hedged 2019 FULL-YEAR RESULTS
Slide 55: NAV evolution
NAV evolution Going Concern Net Asset Value(1) 20 Non Lfl revaluation & intangible assets (in € per share) +€2.71 €233.90 Recurring EPS 15 +€12.72 Rent effect €217.50 -€10.80 €212.95 +€4.55 +€4.08 -€10.15 10 Asset Yield effect revaluation -€13.58 5 -€6.79 Other 0 -€1.40 GMV €65.3 Bn December 2018 Di
Slide 56: Delivering on strategic and capital allocation priorities
Delivering on strategic and capital allocation priorities Announced To date 2020 and onwards €1.2 Bn (±50% office/50% retail) Reduce leverage: €6 Bn of disposals €4.8 Bn (80%)(1) €2.5 Bn additional disposals Prioritise existing Flagships: Review development projects €3.2 Bn removed from pipeline ext
Slide 57: Guidance
GUIDANCE Mg UNIBAIL-RODAMCO-WESTFIELD
Slide 58: Guidance
Guidance Key inputs AREPS 2020 Medium term CAGR Indexation Rental uplifts Increased disposals €11.90 - €12.10 +3% to +5% Reduced pipeline (Rebased for disposals(1)) Taxation Cost of debt No acquisitions assumed (1) As if all planned disposals had happened on January 1, 2020 2019 FULL-YEAR RESULTS 58
Slide 59: Dividend
DIVIDEND Mg UNIBAIL-RODAMCO-WESTFIELD
Slide 60: Dividend for fiscal year 2019
Dividend for fiscal year 2019 Cash dividend : €10.80 (1) 87% pay-out ratio INTERIM €5.40 on March 26, 2020 FINAL €5.40 on July 6, 2020 Output of 2020-2024 BP: €10.80 is sustainable (1) Subject to approval by Annual General Meetings of Unibail-Rodamco-Westfield SE and WFD Unibail-Rodamco N.V. 2019 FU
Slide 61: Established dividend track record
Established dividend track record 94%(1) 93% 91% 89% 90% 88% 89% 88% 87% 88% 87% 87% 86% 12.92 12.05 12.37 11.24 10.92 10.46 10.22 9.60 9.19 9.27 9.03 8.52 10.80 10.80 10.80 10.20 7.86 9.60 9.70 8.90 8.40 8.00 8.00 8.00 7.50 7.00 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Pay-o
Slide 62: URW.COM
W UNIBAIL-RODAMCO-WESTFIELD URW.COM
Unibail-Rodamco-Westfield — FY2019 Earnings Presentation on 6ix