Unibail-Rodamco-Westfield SE · EURONEXT:URW
Unibail-Rodamco-Westfield — H1 2019 Earnings Presentation
48 slides from Unibail-Rodamco-Westfield's earnings presentation, Jul 31, 2019
Slide 1: 2019 Half-Year Results
2019 HALF-YEAR RESULTS Wy UNIBAIL-RODAMCO-WESTFIELD
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: Financial Results
FINANCIAL RESULTS Ww UNIBAIL-RODAMCO-WESTFIELD
Slide 4: 2019 Half-Year Results
2019 Half-Year Results € Mn H1-2019 H1-2018(1) Growth Lfl Growth(2) Shopping Centres 1,137 798 +42.4% +2.1% Offices & Others 62 76 -19.1% +9.4% Convention & Exhibition 56 49 +14.7% +14.7% Net Rental Income 1,254 923 +35.9% +3.3% Recurring Net Result (Group share) 916 703 +30.4% Recurring EPS 6.63 6.
Slide 5: Continental Europe Highlights
CONTINENTAL EUROPE HIGHLIGHTS
Slide 6: Solid retail Lfl NRI growth…
Solid retail Lfl NRI growth… Net Rental Income (€ Mn) H1-2019 H1-2018(1) Growth Lfl Growth France 330 323 +2.2% +2.0% Central Europe 113 108 +5.3% +4.1% Spain 77 82 -6.3% +5.3% Nordics 66 73 -10.2% -2.0% Austria 56 54 +3.5% +2.1% Germany 70 69 +0.9% +0.7% The Netherlands 28 30 -5.1% +0.4% Total Cont
Slide 7: … comping a strong H1-2018
… comping a strong H1-2018 6.6% 6.5% 5.2% 5.3% 5.3% 4.1% 4.2% 4.2% 3.8% 3.2% 1.7% 2.0% 2.1% 1.4% France Central Europe Nordics Spain Continental Europe -2.0% H1-2017 H1-2018 H1-2019 France, Central Europe, Nordics & Spain = ~80% of NRI H1-2018 and prior are restated according to the proportionate me
Slide 8: Healthy Lfl 2019 NRI outlook
Healthy Lfl 2019 NRI outlook Leasing activity Less demanding ~+3% H2 comparable 2019 HALF-YEAR RESULTS 8
Slide 9: Improved MGR uplifts
Improved MGR uplifts 13.5% 13.8% 12.2% Rotation rate 5.3% 10.3% Leases signed 700 H1-2017 H1-2018 H1-2019 H1-2019 Flagships NB: Deals signed on standing assets H1-2017 calculated on an IFRS basis, as published 2019 HALF-YEAR RESULTS 9
Slide 10: Excellent tenant sales growth…
Excellent tenant sales growth… 13.8% 3.1% YTD May Nordics 4.9% 5.2% 4.6% 2.8% 2.4% 3.4% 3.4% Central Europe Shopping Centres Flagships Flagships National Sales Germany Indices 4.6% 2.0% 1.9% 1.6% YTD June Austria France 5.3% 5.7% 2.3% 1.1% Shopping Centres Flagships Flagships Spain All data YTD May
Slide 11: … with differentiating segments performing very well
… with differentiating segments performing very well +8.8% +6.4% +4.6% +4.1% Aéroville, Décathlon Parly 2, UGC Ciné Cité +1.4% Sport Dining Entertainment Health & Fashion Beauty 46% of new lettings GLA Galeria Mokotow, Chanel Täby Centrum, Täby Deli All data YTD through June 30, 2019 2019 HALF-YEAR
Slide 12: Dining & Leisure extensions increase attractiveness of our centres
Dining & Leisure extensions increase attractiveness of our centres Carré Sénart Vélizy 2 Febuary 2019 opening – Fully let March 2019 opening – Fully let GLA Footfall(1) GLA Footfall(1) +4,200 sqm +5.4% +20,000 sqm +13.2% (1) From opening through June vs. same period last year 2019 HALF-YEAR RESULTS
Slide 13: Resilient UK & US Activity Despite Headwinds
RESILIENT UK & US ACTIVITY DESPITE HEADWINDS
Slide 14: Operating metrics UK
Operating metrics UK EPRA Vacancy Tenant Sales MGR uplift Like-for-like NRI 8.7% +7.1% +15.9% -3.1% Westfield London 2019 HALF-YEAR RESULTS 14
Slide 15: Operating metrics US
Operating metrics US Specialty Occupancy (%) Sales psf Growth (%) Rental Spreads (%) Comp NOI Growth (%) H1-2019 H1-2018 H1-2019 H1-2018 H1-2019 H1-2018 H1-2019 H1-2018 US 93.4 94.3 +11.3 +4.9 +5.2 +3.0 +2.2 -3.0 Flagships 94.6 95.5 +12.8 +5.7 +7.7 +5.5 +5.5 -2.6 Regionals 91.6 92.7 +3.6 +2.7 -1.1 -
Slide 16: Limiting the Impact of a Challenging Retail Market
LIMITING THE IMPACT OF A CHALLENGING RETAIL MARKET
Slide 17: Retailer failures…
Retailer failures… Cont. Europe UK US 85 stores 20 stores 145 stores Annualized potential exposure: 1.5% of Group retail MGR NB: Data refer to H1-2019 only 2019 HALF-YEAR RESULTS 17
Slide 18: … are proactively managed and relet
… are proactively managed and relet Cont. Europe UK US(1) URW # of stores 85 20 145 250 Trading - no rent cut 30 9 28 67 Trading - rent cut 10 6 30 46 Replaced 13 0 20 33 Trading or replaced 62% 75% 54% 58% Vacant 32 5 67 104 Annualized spot exposure: 0.7% of Group retail MGR (1) # stores replaced i
Slide 19: Revenue Synergies Starting
REVENUE SYNERGIES STARTING Ww UNIBAIL-RODAMCO-WESTFIELD
Slide 20: International leasing success: The Void
International leasing success: The Void Location-Based VR: The Next Phase of Immersive Entertainment Pop-ups: 4 Permanent: >25 centres in US and Europe GLA: ~20,000 sqm Westfield World Trade Center 2019 HALF-YEAR RESULTS 20
Slide 21: Commercial Partnerships
Commercial Partnerships Cont. Europe UK US €15.4 Mn (+12%) £4.1 Mn (+24%) $33.8 Mn (+2%) 2019–2023 CAGR: +10% (1) Forum des Halles Westfield London Westfield Garden State Plaza (1) Based on 5Y Business Plan 2019 HALF-YEAR RESULTS 21
Slide 22: Rolling-out the Westfield brand
Rolling-out the Westfield brand September 20 September 27 September 12 September 25 September 13 September 26 September 14 September 18 September 19 September 21 2019 HALF-YEAR RESULTS 22
Slide 23: Very Good Office and C&E Performance
VERY GOOD OFFICE AND C&E PERFORMANCE
Slide 24: Office & Others: strong Lfl growth
Office & Others: strong Lfl growth Net Rental Income (€ Mn) H1-2019 H1-2018(1) Growth Lfl Growth France 47 67 -30.4% +13.8% Nordics 5 6 -19.8% -14.2% Others 4 3 +24.9% -1.0% US 6 Total 62 76 -19.1% +9.4% CNIT (1) H1-2018 is restated to include the NRI of hotel assets, which were transferred from the
Slide 25: Convention & Exhibition: excellent performance
Convention & Exhibition: excellent performance Growth Growth € Mn H1-2019 H1-2018 (1) 2019/2018 H1-2017 (1) 2019/2017 Net Rental Income 56 49 +14.7% 51 +9.1% Property Services & Other Income 32 32 -0.5% 26 +23.1% Recurring Net Operating Income 88 81 +8.7% 77 +13.8% Depreciation -7 -6 +23.0% -6 +27.8
Slide 26: Value Creation Opportunities
VALUE CREATION OPPORTUNITIES
Slide 27: URW pipeline: flexible…
URW pipeline: flexible… €11.9 Bn €1.4 Bn -€0.5 Bn €10.3 Bn -€1.1 Bn €2.2 Bn €7.5 Bn -€2.8 Bn €7.6 Bn €2.0 Bn €5.2 Bn €4.2 Bn €2.9 Bn €2.9 Bn €1.3 Bn FY-2018 Deliveries & Changes Removed projects HY-2019 Invested to date Remaining Committed Controlled Secured exclusivity 2019 HALF-YEAR RESULTS 27
Slide 28: … and diversified
… and diversified Dining & Leisure ext / renovation 8% Retail ext / Residential renovation 8% 24% Residential 3rd party 8% 50% 2.2 Mn sqm (1) Hotels Les Ateliers Gaîté Retail 5% Retail brownfield / Offices greenfield 14% 27% Dining & Leisure brownfield / greenfield 8% Cherry Park (1) Including 3rd p
Slide 29: Near-term office deliveries
Near-term office deliveries GLA 100% TIC Delivery GLA 100% TIC Delivery 47,000 sqm €210 Mn H2-2019 49,000 sqm €340 Mn H1-2020 2019 HALF-YEAR RESULTS 29
Slide 30: Near-term retail deliveries
Near-term retail deliveries GLA 100% TIC URW ownership GLA 100% TIC URW ownership +47,000 sqm €1,050 Mn 50% +88,000 sqm €590 Mn 100% Delivery Pre-Letting(1) Delivery Pre-Letting(1) H1-2020 ~75% H2-2020 ~55% (1) Pre-letting: GLA signed, all agreed to be signed and financials agreed 2019 HALF-YEAR RES
Slide 31: Leading on Sustainability
LEADING ON SUSTAINABILITY Ww UNIBAIL-RODAMCO-WESTFIELD
Slide 32: Extended CSR strategy
Extended CSR strategy REINVENTING PLACES TOGETHER FOR A BETTER TOMORROW Cut carbon emissions Be a catalyst for growth Empower our people to become across our value chain by 50% within the communities in sustainability & diversity which we operate change–makers -50% 100% 100% (1) carbon emissions acr
Slide 33: Financing at Attractive Conditions
FINANCING AT ATTRACTIVE CONDITIONS
Slide 34: €3.2 Bn of long-term capital raised at attractive rates
€3.2 Bn of long-term capital raised at attractive rates Secured GBP Bond Euro Senior Bonds 144A USD Bond Westfield Stratford City February June/July June July 8-year 30-year 10-year 7-year €750 Mn €500 Mn $750 Mn £750 Mn 1.0% 1.75% 3.5% 1.64% st (2) st (1) €750 Mn 15-year 1.75% 1 1 Avg maturity 13 y
Slide 35: 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% 8.0(1) 3.6% 7.5 3.4% 7.2 UR WFD 7.0 2.9% 1.0% 3.5% 6.5 2.6% 5.9 2.2% 5.4 4.9 4.5 4.3 1.6% 1.6% 1.6% 1.4% (1) Pro-forma for 30-year bond issued on July 1, 2019, and the repayment of 80% of the 2014 ORNANE
Slide 36: Disposals at Premiums to Book Value
DISPOSALS AT PREMIUMS TO BOOK VALUE
Slide 37: €3.2 Bn of disposals made in last 12-months
€3.2 Bn of disposals made in last 12-months(1) Offices Retail Residential Los Arcos Tour Majunga Tour Ariane Jumbo Cherry Park NDP NIY Premium NDP NIY Premium NDP €2.3 Bn 4.2% 6.2% €0.8 Bn 5.4% 8.4% €0.1 Bn (1) €1.2 Bn in H1-2019, including Majunga disposal, closed on July 3, 2019 2019 HALF-YEAR RES
Slide 38: Majunga case study
Majunga case study GLA TIC(1) NIY 65,600 sqm €462 Mn 4.16% NDP 13-year IRR (2) TAC/wsqm €850 Mn €13,500 12% (1) Including lease incentives granted after delivery (2) Unlevered IRR 2019 HALF-YEAR RESULTS 38
Slide 39: Sound Balance Sheet
SOUND BALANCE SHEET Ww UNIBAIL-RODAMCO-WESTFIELD
Slide 40: Healthy credit ratios
Healthy credit ratios LTV ICR 60% 6.1 41% 41% 5.9 40% 37.5%(1) 4.6 4.6 5.8x 30% 37% 33% 4.0 3.8 3.5 30% 2.5 3.5 25% 2.0 Typical covenant level Target range (1) IFRS - Pro-forma for Majunga disposal (closed on July 3, 2019). LTV as at June 30, 2019: 38.3% 2019 HALF-YEAR RESULTS 40
Slide 41: Ample headroom for sensitivity to NIY change and…
Ample headroom for sensitivity to NIY change and… (1) ∆ NIY -25 bps 0 bps +25 bps +50 bps +75 bps +100 bps GMV impact 3.3 0,0 (in € Bn) -3.0 -5.6 -8.0 -10.2 LTV 38.3% Pro-forma LTV 35.6% 37.5% 39.4% 41.3% 43.1% 44.9% Remaining €26 Bn €23 Bn €20 Bn €17 Bn €15 Bn €13 Bn headroom(2) (1) Applied to the
Slide 42: … risk premiums remain high in Europe
… risk premiums remain high in Europe French Shopping Centres UK Shopping Centres US Shopping Centres +350 bps +320 bps +160 bps 7.6% 6.8% 6.4% 5.7% 5.7% 5.8% 4.3% 4.5% 4.5% 4.6% 4.1% 4.3%(1) 4.3% 2.7% 1.3% 0.6% 2007 9 11 13 15 17 19 2008 10 12 14 16 18 19 2007 9 11 13 15 17 19 Appraisers’ Discount
Slide 43: NAV Evolution
NAV EVOLUTION Ww UNIBAIL-RODAMCO-WESTFIELD
Slide 44: NAV evolution
NAV evolution Non Lfl revaluation & intangible assets Going Concern Net Asset Value(1) Recurring +€0.07 EPS (in € per share) Rent effect €233.90 +€6.63 +€2.31 -€5.40 €217.82 €217.70 -€10.68 -€0.12 Asset revaluation Yield effect -€4.11 -€6.49 Other -€2.64 December 2018 Dividend Mtm of fixed-rate Dece
Slide 45: Increasing Guidance
INCREASING GUIDANCE Ww UNIBAIL-RODAMCO-WESTFIELD
Slide 46: Increasing AREPS 2019 guidance
Increasing AREPS 2019 guidance Initial guidance: €11.80 - €12.00 Solid performance More favourable financing conditions Implementation of IFRS 16 (~+€0.18) Increased guidance: €12.10 - €12.30 2019 HALF-YEAR RESULTS 46
Slide 47: Minimum dividend of €10.80 per share is sustainable
Minimum dividend of €10.80 per share is sustainable “Going forward, the Group expects to maintain its dividend at a (1) minimum of €10.80 ” (1) Based on 5Y BP 2019-2023 2019 HALF-YEAR RESULTS 47
Slide 48: URW.COM
W UNIBAIL-RODAMCO-WESTFIELD URW.COM
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