Helios Re Socimi, S.a. · BME:SCHLR
Helios Re Socimi — Lar España Real Estate SOCIMI — Investor Presentation (September 2018)
49 slides from Helios Re Socimi's investor presentation, September 2018
Slide 1: Corporate Presentation
CORPORATE PRESENTATION www.larespana.com The Spanish Retail Specialist September 2018
Slide 2: Index
Index 01 02 03 04 05 Company Investment Financial ESG Appendix 1 Description Highlights Results Results Appendix 2
Slide 3: Company Description
01 Company Description
Slide 4: Snapshot
01 Company Description 4 Snapshot Shareholder Structure First IPO of a Spanish REIT listed on the Spanish Stock Exchange PIMCO Other investors 19.60% 45.65% Focused on creating both sustainable income and strong capital returns for shareholders Manager Grupo Lar Lar España is managed by Grupo Lar, p
Slide 5: Portfolio at a glance
01 Company Description 5 Portfolio at a glance Unique exposure to real Resilient prime dominant Recurrent cash flow estate retail assets and the shopping centers in generation @ 5.4% Net Initial Spanish consumer and attractive catchment areas Yield tourism recovery Value added approach: Upside poten
Slide 6: A Cherry Picked Portfolio
01 Company Description 6 A Cherry Picked Portfolio ACQUISITIONS Albacenter Marcelo Spínola As Termas El Rosal Parque Abadía Anecblau Alovera II Alovera III Galaria 22 Retail Units Alovera I Portal de la Marina Alovera IV Vidanova Parc Dev. Cheste Dev. Villaverde Egeo Almussafes Megapark Megapark Lei
Slide 7: Major corporate milestones from 2017 & 2018 YTD
01 Company Description 7 Major corporate milestones from 2017 & 2018 YTD JAN MAR MAY JUL SEP DEC FEB JUN AUG +15.8% Abadía Retail Dividend +19.5% Vidanova Parc Analyst Day Rivas Futura +34% Galaria Asset Park Acquisition Payment Asset Revaluation Credit for Construction Acquisition Asset Retail Park
Slide 8: Board of Directors & Critical Activities
01 Company Description 8 Board of Directors & Critical Activities Independent and experienced Board: 5 independent directors (5 out of 7) Critical Activities internalized José Luis del Valle Roger Cooke Pedro Luis Uriarte Sergio Criado Jon Armentia Susana Guerrero Chairman and Independent Independen
Slide 9: External Manager: A Real Estate Reference
01 Company Description 9 External Manager: A Real Estate Reference Grupo Lar now owns a 9.99% stake in Lar España, subject to a lock-up period Manager New IMA recently signed Grupo LAR Key Facts 1 Family owned Company +40Y of experience Retail Offices 39 Shopping centres 9 Office buildings developed
Slide 10: Investment Strategy Focused in Retail
01 Company Description 10 Investment Strategy Focused in Retail Investment Target Creation of unique shopping Criteria 100% experiences levered ownership IRR>12% Customer journey analysis Value-Creation Potential Optimum size for area of influence Dominant Optimal and fine-tuned tenant line-up Core+
Slide 11: The value of a retail platform
01 Company Description 11 The value of a retail platform Main market players by owned GLA, Lar España has a clear objective to consolidate among the including GLA under development1 top retail operators in Spain: target to selectively increasing GLA to generate revenue synergies Peer 1 584,222 14 La
Slide 12: Strong Transformation + Innovation
01 Company Description 12 Strong Transformation + Innovation Transformation Strategy Digital Innovation Big Data Customer Intelligence Full Market Connectivity Knowledge Webs Seeketing APPS System WIFI Social Media E-Beacons c.107k 33% 74 sqm Rotation Rate since Leased since Relettings + New Letting
Slide 13: Business Plan Guidance 2018-2021
01 Company Description 13 Business Plan Guidance 2018-2021 Target Returns ▪ 12% Target Annual Return on investments ▪ €380m of divestments over the next 24 months From Office, residential and non-core retail assets Divestments ▪ >€90 Mn of divestments From all logistics assets ▪ Finance all existing
Slide 14: Investment Highlights
02 Investment Highlights
Slide 15: Top 10 Value Drivers
02 Investment Highlights 15 Top 10 Value Drivers 10 1 Attractive Dividend Momentum of Real Policy Estate in Spain /Yield Compression 9 2 ANNUALIZED NET RENT NET LTV €74.3 Mn 36% Optimal Debt Upside from the Retail Management Existing Portfolio CURRENT POTENTIAL ANNUALIZED AVG. COST OF DEBT NET RENT
Slide 16: Value Driver 1: Momentum of RE in Spain / Yield Compression
02 Investment Highlights 16 Value Driver 1: Momentum of RE in Spain / Yield Compression 1 2 3 4 5 6 Spanish economy has been It is expected to continue Consumer´s Confidence Unemployment Rate Future Investment Spanish Real Estate surprising on the upside outperforming the keeps growing in line with
Slide 17: Value Driver 2: Potential from the Existing Retail Portfolio
02 Investment Highlights 17 Value Driver 2: Potential from the Existing Retail Portfolio +c.60% +5.8% +c.8% >6% Estimated Rental Retail Expected Expected Increase Potential Topped-Up NIY NIY NIY Future Investments Ongoing Opened Development 15 c.110 1st Phase 15 95 Existing Income Generating Assets
Slide 18: Value Driver 3: Strong Operating Results
02 Investment Highlights 18 Value Driver 3: Strong Operating Results Lar España continues outperforming the market Letting activity at the core of the strategy Sales1 H1 2018 Visits H1 2018 €303.6 Mn 26.9 Mn +8.6% RENTAL GROWTH Lar España Retail Sales 11,508 sqm 5% +2.0% ANNUALIZED ROTATED ROTATION
Slide 19: Value Driver 3: Strong Operating Results
02 Investment Highlights 19 Value Driver 3: Strong Operating Results All figures refer to H1 2018 period Vs H1 2017 Active Asset & Tenant €36.4 Mn Management LfL Occupancy Rate LfL NOI LfL GRI Incentives reduction to + Growth Growth Growth tenants Smart Capex in Operating Assets +2.1 p.p. +4.6% +2.9
Slide 20: Value Driver 4: Innovation Strategy
02 Investment Highlights 20 Value Driver 4: Innovation Strategy Disruptive projects differentiating among our competitors To position Lar España To create shared value to lead economic and as the leader in digital transformation social progress, and also generate financial in the retail sector retur
Slide 21: Value Driver 4: Innovation Strategy
02 Investment Highlights 21 21 Value Driver 4: Innovation Strategy Disruptive projects differentiating among our competitors Big Data Full Conectivity Market Knowledge Market Place DIGITALIZATION & WEBS DIFFERENTIATION CUSTOMER APPS SEEKETING SYSTEM TRANSACTIONAL INTELLIGENCE WIFI E-BEACONS WEB SOCI
Slide 22: Value Driver 5: Developments – Lagasca99
02 Investment Highlights 22 Value Driver 5: Developments – Lagasca99 New residential concept €188 Mn in the centre of Madrid Valuation1 80% 86% 70% 30% 44% FY 2015 FY 2016 9M 2017 Q1 2018 July 2018 Last construction phase, focused on interior works Extraordinary dividend 500,000 tons of travertine m
Slide 23: Value Driver 5: Developments – Vidanova Parc
02 Investment Highlights 23 Value Driver 5: Developments – Vidanova Parc Leroy Merlin September 27th & Norauto complete inauguration already opened 100% GLA signed Smart and balanced mix of attractive retailers, leisure activity and F&B offering 45,137 Sqm €14.0 Mn €35.8 Mn GLA Acquisition Price Val
Slide 24: Value Driver 5: Developments – Palmas Altas
02 Investment Highlights 24 Value Driver 5: Developments – Palmas Altas Excellent location, Q2 2019 4 km from Seville’s city centre Opening 73% 8 Inditex GLA signed and committed Brands signed 14 Mn/year 200 €88.5 Mn Exp. Visits Tenants Valuation1 1.5 hours c.15 Mn €151.6 Mn Est. construction Exp. A
Slide 25: Value Driver 6: Attractive valuation of the existing portfolio
02 Investment Highlights 25 25 Value Driver 6: Attractive valuation of the existing portfolio H1 2018 Total Portfolio Total Retail H1 2018 Valuation H1 2018 Valuation €1,580 Mn €1,288 Mn 33.8% 27.0% 13.2% 10.4% LfL H1 2018/17 Since Acquisition LfL H1 2018/17 Since Acquisition Before Invested Capex B
Slide 26: Value Driver 7: Asset Rotation Policy Aimed at Maximizing Returns
02 Investment Highlights 26 Value Driver 7: Asset Rotation Policy Aimed at Maximizing Returns Arturo Soria Sale Rivas Futura Logistics Portfolio & Office Building Retail Park Cheste Sale 34.5% €61.6 Mn 82.5% over acq. price acquisition price over acq. price Abadía’s Commercial Gallery €14 Mn acquisi
Slide 27: Value Driver 7: Asset Rotation Policy
02 Investment Highlights 27 Value Driver 7: Asset Rotation Policy Aimed at Maximizing Returns Remaining non-core assets will add value in the coming months OFFICES LAGASCA99 VALUATION1 VALUATION2 €97.5 Mn €188 Mn MARCELO SPÍNOLA ELOY GONZALO JOAN MIRÓ VALUATION1 VALUATION1 VALUATION1 €38.5 Mn €37.5
Slide 28: Value Driver 8: Acquisition Pipeline Aimed at Increasing Retail Platform
02 Investment Highlights 28 Value Driver 8: Acquisition Pipeline Aimed at Increasing Retail Platform Current Opportunities +€220 Mn of Investment Pipeline ✓ Large and visible pipeline Short Term Pipeline 110k+ including actionable off-market acquisitions with yields in the 6% area Asset Class Aprox.
Slide 29: Value Driver 9: Debt Management as a Means of Value Creation
02 Investment Highlights 29 Value Driver 9: Debt Management as a Means of Value Creation Debt Structure and Amortization Profile € Mn €140 Mn €474.3 Mn Gross Financial Debt Senior Secured Bond Bank Debt €614.3 Mn 258.6 Net LTV Avg. Cost of Debt 210.4 36% 2.19% 140.0 100.7 Interest Cover Ratio1 (ICR)
Slide 30: Value Driver 10: Predictable and Sustainable Dividend Distribution Policy
02 Investment Highlights 30 Value Driver 10: Predictable and Sustainable Dividend Distribution Policy ✓ Predictable and ✓ Competitive in the ✓ Attractive vs ✓ As a result of a Dividend policy sustainable dividend International Real Spanish equity solid cash flow objectives and distribution schedule
Slide 31: Value Driver 10: Consistent dividend growth per share
02 Investment Highlights 31 Value Driver 10: Consistent dividend growth per share 4th DIVIDEND IN 4 YEARS 55 0.55 €0.49 ps €45.0 Mn 5.1% DIVIDEND YIELD 45 0.45 2017 DIVIDEND ON NAV1 €0.33 ps €45.0 Mn 0.35 Dividend approved by the AGM 35 +50% and to be paid on VS 2016 €0.20 ps €30.0 Mn 0.25 18th MAY
Slide 32: Financial Results H1 2018
03 Financial Results H1 2018
Slide 33: Solid Company performance in H1 2018
03 Financial Results 33 Solid Company performance in H1 2018 +20.9% 33.8% 10 quarters in Property operating result Portfolio revaluation outperforming the market Operating since acquisition in retailers declared sales (+2.0%) Results +12.4% Recurring EBITDA (before invested capex) & footfall (+1.1%)
Slide 34: Successful & Strong Key Facts delivered in H1 2018
03 Financial Results 34 Successful & Strong Key Facts delivered in H1 2018 €1,580 Mn +9.1% GAV vs H1 2017 €39.8 Mn +6.1% €10.34 €979.3 Mn 10.7% GRI vs H1 2017 EPRA NAV per share EPRA NAV ROE €33.5 Mn +20.9% 5.5% 5.4% 6.3% Property vs H1 2017 EPRA “topped-up” NIY EPRA NIY ROA Operating Result €29.6 M
Slide 35: Consolidated Income Statement
03 Financial Results 35 Consolidated Income Statement (€ Millions) RECURRING3 Chg% NON-RECURRING3 TOTAL3 Chg% H1 2018/17 H1 2018/17 H1 2018 H1 2017 H1 2018 H1 2017 H1 2018 H1 2017 Rental Income 39.8 37.5 - - 39.8 37.5 Other Income 2.5 1.0 - - 2.5 1.0 Property Operating Expenses (7.7) (6.3) - - (7.7)
Slide 36: ESG Results
04 ESG Results
Slide 37: ESG - Asset Management & Environment
04 ESG Results 37 ESG - Asset Management & Environment 1 Responsible asset management focused on consumptions and emissions Promoting sustainability certification measures, CSR Master Plan to meet the encouraging the use of new technology to improve our assets’ environmental quality and most demandi
Slide 38: ESG - Corporate Governance
04 ESG Results 38 ESG - Corporate Governance Risk Control & Management System Integrated enterprise risk management (ERM) system designed to mitigate the risks exposure ERM system involves all Lar España’s staff and Risk Map: the ERM system categorises risk into high, 1 supervising of third parties
Slide 39: Appendix 1
05 Appendix 1
Slide 40: Retail Assets
05 Appendix 1 40 40 Retail Assets Megapark Gran Vía P. Marina El Rosal Anec Blau As Termas P. Altas Abadía Bilbao Vigo Alicante Ponferrada Barcelona Lugo Seville Toledo Development Market Value €217.9 Mn €165.0 Mn €122.5 Mn €109.0 Mn €95.9 Mn €85.6 Mn €88.5 Mn €80.9 Mn (Jun 2018) GLA (Sqm) 83,379 41
Slide 41: Retail Assets
05 Appendix 1 41 41 Retail Assets Rivas Albacenter 22 R. Units Vistahermosa Vidanova Parc Madrid Albacete North Spain + Alicante Valencia Balearic Islands Development Other Assets3 Market Value €65.4 Mn €57.9 Mn €52.9 Mn €49.7 Mn €35.8 Mn €50.1 Mn (Jun 2018) GLA (Sqm) 36,726 27,890 27,909 33,550 44,
Slide 42: Offices and Residential
05 Appendix 1 42 42 Offices and Residential Offices Residential Lagasca99 Market Value Market Value €97.5 Mn1 €188.0 Mn2 (Jun 2018) (Jun 2018) GLA (Sqm) 23,816 GLA (Sqm) 26,203 Acquisition Date NA Acquisition Date 30 Jan ´15 Acquisition Price €51.4 Mn Acquisition Price €50.1 Mn3 EPRA NIY1 0.2% Const
Slide 43: Appendix 2
05 Appendix 2
Slide 44: Highlights of the Investment Management Agreement
05 Appendix 2 44 Highlights of the Investment Management Agreement 1 Alignment with current Business Plan 7 2 Unanimously approved by the seven REINFORCING PRESENCE Enhanced Corporate Provides continuity OF INDEPENDENT members of the Board Governance and certainty DIRECTORS IN THE BOARD (5 independe
Slide 45: External management by Grupo Lar continues to be the optimal strategy
05 Appendix 2 45 External management by Grupo Lar continues to be the optimal strategy for Lar España Retail property requires skilled, hands-on management… …which Grupo Lar is uniquely qualified to provide ▪ Granular unit configuration and diverse ▪ Lar España can draw upon the expertise Operationa
Slide 46: Recognitions
Recognitions
Slide 47: Recognitions
47 Recognitions 2018 EPRA BPR & sBPR Awards Since June 2015: Member of FTSE EPRA/Nareit Global Estate Index First SOCIMI to be awarded with the "EPRA Recognized with the GOLD AWARD” in Financial Reporting for the “EPRA Gold Award” in 4th consecutive year Sustainability Best Practices Sustainability
Slide 48: Disclaimer
48 Disclaimer This document has been prepared by Lar España Real Estate SOCIMI, S.A. (the “Company”) for information purposes only and it is not a regulated information or information which has been subject to prior registration or control by the Spanish Securities Market Commission. This document n
Slide 49: Corporate Presentation
Corporate Presentation Follow us: www.larespana.com Lar España Real Estate SOCIMI info@larespana.com Lar España App
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