Wereldhave N.V. · EURONEXT:WHA

Wereldhave — FY2014 Earnings Presentation

58 slides from Wereldhave's earnings presentation, Feb 5, 2015

  1. Slide 1: Full-year results 2014

    Full-year results 2014 Schiphol 5 February 2015

  2. Slide 2: Highlights 2014

    Highlights 2014 Transformational year: becoming the leading specialist in mid-sized shopping centres Operational excellence  Adding to track record; all targets met or exceeded Portfolio: asset rotation of € 1.3bn  Selective add-on acquisitions in Dutch and Belgian shopping centres  Exit Spanish

  3. Slide 3: Highlights 2014

    Highlights 2014 Financial performance 2014 2013 Restated for rights issue  Direct result per share €2.97 €2.86  Indirect result per share €(2.38) €(1.28) of which transaction costs €(1.74) €(0.00)  EPRA NAV per share €54.35 €56.41  Dividend per share €2.87 €2.87  LTV 35.4% 27.4% Operational exc

  4. Slide 4: Key results

    Key results 2014 2013 % growth % LFL growth NRI Shopping centres €96.1m €79.6.4m 20.8% 3.6% NRI Offices €22.0m €23.1m -4.8% 3.4% NRI Other* €0.7m €12.4m n.a. n.a. Total net rental income €118.8m €115.1m 3.2% 3.6% Direct result per share €2.97 €2.86 3.8% Average number of shares 25.387m 24.974m Valua

  5. Slide 5: Strategy

    Strategy Docks Vauban – Le Havre 5

  6. Slide 6: More focused portfolio

    More focused portfolio Countries (#) Assets (#) Sectors (#) 7 85 5 4 32 2 2012 Current 2012 Current 2012 Current Occupancy (retail L-f-L) Overhead (€m) Cost of debt (%) 98.6% 22.7 2.7% 98.0% 2.2% 14.1 2012 Current 2012 Current 2012 Current 6

  7. Slide 7: More focused portfolio

    More focused portfolio Number of countries Number of assets Number of sectors 7 85 5 4 32 2 2012 Current 2012 Current 2012 Current Average value (€m) 374 810 31 104 523 1.619 7

  8. Slide 8: Moving ahead with our strategy

    Moving ahead with our strategy  Successful completion derisk and regroup phase  Focus on core markets and exit US, UK and Spain  Sale of over 40% of the portfolio (>€1.5bn)  Team strengthened, operational track record established  Growth phase started in 2H 2014  €850m acquisition of six domin

  9. Slide 9: Our core markets

    Our core markets 19% 22% 16% 27% 11% Finland Netherlands Belgium France Paris 1 shopping centre 10 shopping centres 8 shopping centres 6 shopping centres 3 office buildings GLA: 104,000m2 Average GLA: 19,119m2 Average GLA:16,380m2 Average GLA: 33,750m2 Average GLA:17,567m2 Footfall: 16m Average foot

  10. Slide 10: Towards a more coherent and higher quality portfolio

    Towards a more coherent and higher quality portfolio Total GLA per shopping centre (m2) Top 10 assets: 104,000 63% of total GLA 53,500 45,400 39,500 37,600 34,500 33,000 30,252 28,900 28,600 Itis Occupancy 92%* 85% 92% 92% 92% 100% 100% 99% 88% 100% LFL NRI +7% N.a. N.a. N.a. N.a. +10% N.a. +3% N.a.

  11. Slide 11: Becoming the leading specialist in dominant mid-sized shopping centres

    Becoming the leading specialist in dominant mid-sized shopping centres Portfolio focus  North-western continental Europe  Dominant mid-sized shopping centres in larger provincial cities (>100,000 inhabitants) Solid financials Active portfolio management  Conservative LTV of 35% - 40%  Selective

  12. Slide 12: Focus on dominant mid-sized shopping centres

    Focus on dominant mid-sized shopping centres Acquisition criteria:  90% of shopping needs (min. 20,000m2 GLA)  Top-of-mind in catchment area Rationale for focusing on dominant mid-sized shopping centres:  In larger provincial cities: at least 100,000 inhabitants within 10 minutes drive time  Con

  13. Slide 13: A clear framework for target markets

    A clear framework for target markets  Core markets  Retail: Selective acquisitions and disposals fulfilling our acquisition criteria  Paris office market: Selective growth  Entry in new markets under stringent criteria  Northwest continental Europe  Stable economies with solid long term perspe

  14. Slide 14: Management agenda 2015

    Management agenda 2015  Execute integration plan in France  Organisation in place (1 July 2015)  Stabilising NRI French retail portfolio at €46m  Continue strong operational performance  Strong like-for-like rental growth  Work towards 98% long term occupancy of the retail portfolio  Realise

  15. Slide 15: Operations

    Operations Vier Meren - The Netherlands 15

  16. Slide 16: Integration plan for the French platform

    Integration plan for the French platform 2014 2015 Q4 Q1 Q2 Q3 Q4 Actions Wereldhave Portfolio integration (Q4 2014/Q1 2015) Wereldhave   Back office External party   IT systems   Invoicing (Q1 done by Unibail-Rodamco, shadow by Wereldhave) Wereldhave Recruitment (Q4 2014-Q2 2015)  Recruit ke

  17. Slide 17: Shopping Centres net LfL rental growth

    Shopping Centres net LfL rental growth Performance of 270 bps above indexation, vs 200 bps target Countries Total portfolio 6.7% 3.2% 1.0% 3.6% Above Indexation 0.7% 6.1% 1.6% 2.7% 2.7% 2.8% 2.0% Indexation - 0.7% 2.0% 1.7% 0.9% 0.9% 0.9% 0.6% 0.4% 0.9% Finland Belgium Netherlands Total 2013 2014 Ta

  18. Slide 18: Our retailers: Blokker reinvented

    Our retailers: Blokker reinvented Storefront before after Interior after before 18

  19. Slide 19: Occupancy

    Occupancy Occupancy Value* Q4 2014 LfL Q3 2014 Q4 2013 Q4 2014 Belgium 94.6% 98.8% 98.0% 99.2% 597 18.4% Finland 92.1% 99.2% 99.3% 99.4% 605 18.7% France 91.2% - - - 832 25.7% Netherlands 98.0% 98.0% 98.4% 97.0% 697 21.5% Shopping centres 93.9% 98.6% 98.5% 98.4% 84.3% 2,731 Belgium 92.5% 92.5% 92.5%

  20. Slide 20: Shopping centre visitors

    Shopping centre visitors (x 1,000) 2014 2013 % growth Belgium 10,732 10,762 -0.3% Finland 16,250 14,568 11.5% Netherlands 38,812 37,977 2.2% Total 65,794 63,307 3.9%  Belgium: increase in footfall in Nivelles, slight decrease in Belle-Ile and Tournai. Overall -0.3% vs general market -1.9%  Finland

  21. Slide 21: Events improving footfall and local inclusion

    Events improving footfall and local inclusion Festival Classique:  Short classical concerts and circus acts on special and surprising locations.  Performances tailored to Wereldhave shopping centres and participation by young, local talent  Warm, welcoming and low- barrier to entry atmosphere  I

  22. Slide 22: Corporate citizenship and philanthropy

    Corporate citizenship and philanthropy Partnership with LINDA.FOUNDATION:  Foundation of Dutch celebrity Linda de Mol focussed on supporting children in financially troubled families  Raising funds with events and performances in ‘pop-up living rooms’ created in Wereldhave shopping centres  Impro

  23. Slide 23: CSR framework

    CSR framework Pillar Targets Year Improve energy efficiency by 30% 2020 Bricks BREEAM-Outstanding r(e)developed offices >2014 BREAAM Very Good shopping centres 2020 Employee satisfaction scores of 7.5 or higher 2017 HR Increase average training to 25 hours 2015 Increase % female managers to 30% 2016

  24. Slide 24: CSR progress

    CSR progress Pillar Progress Start energy monitoring and implement improvement plans Bricks Carré Vert and Noda ‘Outstanding’, ‘Le Cap’ DS Outstanding DS ‘Outstanding’ for Eggert & Koningshoek, other assessments in progress Survey done; score 7.7, follow-up actions HR Company wide workshops: CSR and

  25. Slide 25: Portfolio

    Portfolio Rivétoile - Strasbourg 25

  26. Slide 26: Kortrijk Ring shopping centre

    Kortrijk Ring shopping centre  Acquired for €108.1m including transaction costs  NIY 6.1%  Dominant shopping centre, located at the ring road of Kortrijk, in the south-west of Belgium  Catchment area > 200,000 people within 10 minute’s drive. Three million visitors  Proven track record, stable

  27. Slide 27: Itis: the prime shopping centre in HMA

    Itis: the prime shopping centre in HMA  Largest redevelopment undertaken by Wereldhave  Successfully refurbished, reconfigured and extended  From undermanaged ‘cash cow’ to most dominant and prime shopping centre in Helsinki MA Value Dec 2011: €450m Capex ‘11-’14: €102m Value Dec 2014: €605m YoC

  28. Slide 28: Noda: attracting blue chip tenants

    Noda: attracting blue chip tenants  State-of-the art office, turn-key development, Wereldhave takes leasing risk  20,209 sqm, 312 parking places, in Issy-les-Moulineax, Southwestern Paris  BREEAM Outstanding DS (92.07%)  Coca Cola lease for 64%, per 1/1/15, 9-yr fixed  Construction 2012-14; tot

  29. Slide 29: Genk Shopping I

    Genk Shopping I  Renovation and extension of oldest shopping arcade in Belgium into prime mid-sized shopping centre  27,100m2 total n.l.a. 14,000m2 refurbishment 13,000m2 extension Acquired in April 2012: €19.5m Capex ‘12-’14: €67.5m Value Dec 2014: €87m YoC fully let: 6.5% Located in city centre,

  30. Slide 30: Committed development pipeline

    Committed development pipeline Total Capex Fully let Completion Investment so far NIY Dutch redevelopment program (NL) €79m €25m 5.9% 2016 Dutch refurbishment capex €30m €12m - 2016 Total €109m €37m  Eggert, Purmerend: first phase of redevelopment completed in August. H&M and Score successfully lau

  31. Slide 31: Modernisation Dutch portfolio progressing well

    Modernisation Dutch portfolio progressing well New escalator and floor in Eggert New passage in De Rooselaar New passage in Koningshoek Kids plaza in Eggert 31

  32. Slide 32: Financials

    Financials Genk - Belgium 32

  33. Slide 33: Direct result

    Direct result (per share) € -0.04 € 0.06 € 0.26 € -0.06 €-0.52 € 0.41 € 2.86 € 2.97 € 3.03 € 2.97 € 2.97 € 2.75 FY 2013* Disposals Acquisitions Standing Interest Tax Other FY 2014 portfolio  Impact of disposals in the US (€-0.29), UK (€-0.11), the Netherlands (€-0.07) and Spain (€-0.05) were more t

  34. Slide 34: Indirect result 2014

    Indirect result 2014 (per share) Indirect result 2014 (per share) € -1.74 € -2.38 € 0.36 € -0.02 €-0.27 € 2.97 € -0.31 € -0.40 € 0.59 Direct Transaction Valuation Valuation Result Buy-back Other Total result costs result derivatives on CB result FY 2014 disposals FY 2014  Transaction cost acquisiti

  35. Slide 35: Valuation result FY 2014 standing portfolio

    Valuation result FY 2014 standing portfolio 1.7% 0.6% 0%* 1.0% 1.0% -0.3% -1.2% -2.0% -2.2% -5.2% -5.8% NLD FIN BEL FRA Total Yield change Market rent & other changes Total • Finland: immaterial yield and market rent correction 35

  36. Slide 36: EPRA NAV per share

    EPRA NAV per share 3.30 2.97 - 2.38 - 0.50 - 22.61 64.99 15.18 61.69 54.85 54.35 2013 Dividend Change in number €550m Direct Indirect Other 2014 of shares rights-issue result result -/- costs IFRS NAV* EPRA NNNAV  Dec 2013: €54.03**  Dec 2013: €53.92**  Dec 2014: €52.07  Dec 2014: €52.19 * Recon

  37. Slide 37: Income statement

    Income statement FY 2014 FY 2013 Amounts in € ‘000 Direct Indirect Direct Indirect Gross rental income 131,648 130,701 Service costs charged 22,676 23,811 Total revenues 154,324 154,512 Service costs paid -25,053 -26,535 Property expenses -10,444 -12,892 Total expenses -35,497 -39,427 Net rental inc

  38. Slide 38: Debt profile

    Debt profile Genk - Belgium 38

  39. Slide 39: Debt profile

    Debt profile Key parameters Q4-14 Q3-14 Covenants Interest bearing debt * € 1,261m € 1,050m  Average cost of debt decreased by 0.4%, mainly related Average cost of debt 2.2% 2.6% to a €200m drawing on the RCF at floating interest rate Borrowing capacity € 453m € 653m in Dec 2014, related to the acq

  40. Slide 40: Outlook

    Outlook Eggert - The Netherlands 40

  41. Slide 41: Outlook

    Outlook  Execute integration plan in France  Organisation in place (1 July 2015)  Stabilising NRI French retail portfolio at €46m  Continue strong operational performance  Strong like-for-like rental growth  Work towards 98% long term occupancy of the retail portfolio  Realise selective inves

  42. Slide 42: Earnings outlook

    Earnings outlook 2012-2014 → Stable dividend 2015-2016 → Growing dividend 3.40 2.87 2.86 2.87 2.97 2.87 + Direct result p/s compound average growth 6-9% for 2015 and 2016 + Growing dividend p/s with pay-out of 85%-90% 2012 2013 2014 Direct result per share Dividend per share * Direct result and di

  43. Slide 43: Q&A

    Q&A Saint Sever - Rouen 43

  44. Slide 44: Appendix

    Appendix Itis - Finland 44

  45. Slide 45: Company Profile

    Company Profile  Independent property company, founded in 1930, first REIT in Europe  Shopping centres in France, Finland, Belgium and the Netherlands; sustainable offices in Paris  ‘REIT’ status in the Netherlands, Belgium, France  Listed on Euronext Amsterdam  Market cap: c€ 2.25bn  Property

  46. Slide 46: Portfolio composition

    Portfolio composition 22% 22% 16% 19% 37% 84% Belgium Finland France Netherlands Shopping Centres Offices & Other 46

  47. Slide 47: Top Tenants & Top Properties

    Top 10 Tenants & Top 10 Properties Rank Tenant % of rent Rating Rank Property Sector Value DEC % of 2014* Total 1 EDF 5.0% A+ 1 Itis (Helsinki, FIN) Shopping Centre € 605m 18.7% 2 HENNES & MAURITZ 3.6% 2 Rivétoile (Strasbourg, FRA) Shopping Centre € 191m 5.9% 3 STOCKMANN 2.3% 3 Docks 76, (Rouen, FRA

  48. Slide 48: Lease expiry profile

    Lease expiry profile 1.2% 1.0% 3.0% 2.2% 5.5% Offices Shopping Centres 16.6% 17.6% 12.3% 11.1% 9.8% 0.2% 5.1% 5.9% 2.3% 3.2% 1.0% 2.0% 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 > 2023  Belgium 5.6% of retail expiries in 2015; 100% already renewed or re-let  Netherlands 5.8% of retail expir

  49. Slide 49: Valuation standing portfolio

    Valuation standing portfolio Shopping centres – In €m FY 2014 FY 2013 Revaluation EPRA NIY Belgium 597 381 (0.2)% 5.7% Finland 605 482 0.0% 5.2% France 832 - (3.2)% 5.5% The Netherlands 697 477 (4.9)% 6.0% Total 2,731 1,340 (2.3)% 5.6% Offices – In €m Belgium 127 126 0.5% 6.9% Paris 380 187 6.7% 4.7

  50. Slide 50: NAV reconciliation (IFRS – EPRA)

    NAV reconciliation (IFRS – EPRA) € per share IFRS NAV adjusted for rights-issue 52.07 Effect of conversion - Diluted NAV 52.07 Fair value derivatives 0.14 Deferred tax 2.14 Goodwill - EPRA NAV 54.35 Fair value derivatives (0.14) Fair value interest bearing debt (0.73) Deferred tax (1.29) EPRA NNNAV

  51. Slide 51: Large Supermarkets Attract Footfall in Similar Proportions as Premium Department Stores

    Large Supermarkets Attract Footfall in Similar Proportions as Premium Department Stores Footfall 30,000 # per week 27,500 20,000 10,000 5,000 Small Small Medium Large specialty supermarket supermarket supermarket 8 out of 10 Wereldhave NL shopping centers are anchored by at least two medium-sized su

  52. Slide 52: Digital strategy

    Digital strategy use online channels to inform, inspire & connect customers and retailers.  Shopping Center website with social media integration  Shop information & special offers placed by retailers (web & app)  Online community for retailers (intranet) for information exchange  Social media p

  53. Slide 53: Country Update

    Country Update Kronenburg - The Netherlands 53

  54. Slide 54: Belgium

    Belgium Key parameters shopping centres FY 2014 FY 2013 Net rental income € 28.0m € 25.9m LfL 3.2% 6.3% Occupancy 94.6% 99.2% Valuation result -0.2% +0.7% NIY (EPRA) 5.9% 6.0% Standing investments € 597m € 381m Under construction € 18m € 90m Genk Shopping I  LfL NRI 3.2%, 280bps above indexation, s

  55. Slide 55: Finland

    Finland Key parameters shopping centres FY 2014 FY 2013 Net rental income € 27.9m € 23.9m LfL 6.7% 5.1% Occupancy 92.1% 99.4% Valuation result 0.0% +4.0% NIY (EPRA) 5.2% 5.3% Standing investments € 605m € 482m Under construction - € 78m  LfL NRI 6.7%, 610bps above indexation, driven by successful r

  56. Slide 56: Netherlands

    Netherlands Key parameters shopping centres FY 2014 FY 2013 Foto sh centre Net rental income € 38.9m € 29.8m LfL 1.0% 1.0% Occupancy 98.0% 97.0% Valuation result -4.9% -4.6% NIY (EPRA) 6.0% 5.9% Standing investments € 697m € 477m Under construction € 18m € 6m Winkelhof, Leiderdorp  LfL NRI +1.0%, 7

  57. Slide 57: Paris

    Paris Key parameters office FY 2014 FY 2013 Net rental income € 10.0m € 9.9m LfL 0.9% 4.5% Occupancy 82.6% 99.0% Valuation result +6.7% +0.6% NIY (EPRA) 4.7% 6.1% Standing investments € 380.0m € 177.0m Under construction n.a. € 220.0m Noda office development, Issy-Les-Moulineaux, Paris  LfL NRI +0.

  58. Slide 58: Contact details

    Contact details Press: Investors & analysts:  Richard Beentjes  Jaap-Jan Fit  Richard.beentjes@wereldhave.com  Jaapjan.fit@wereldhave.com  T +31 20 702 78 34  T +31 20 702 78 43  Investor.relations@wereldhave.com  www.wereldhave.com 58

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