Wereldhave N.V. · EURONEXT:WHA

Wereldhave — H1 2015 Earnings Presentation

58 slides from Wereldhave's earnings presentation, Jul 24, 2015

  1. Slide 1: Half-year results 2015

    Half-year results 2015 Schiphol 24 July 2015

  2. Slide 2: Highlights H1 2015

    Highlights H1 2015 Strong operational results while advancing in growth phase Solid operations  LfL rental growth shopping centres +200bps, +150 bps above indexation, positive in all countries  Occupancy shopping centres increasing to 94.3%  Valuation result +1.1% for total portfolio, turning pos

  3. Slide 3: Highlights H1 2015

    Highlights H1 2015 Financial performance H1 2015 H1 2014 Restated for rights issue  Direct result per share €1.62 €1.51  Indirect result per share €0.64 €(1.31)  EPRA NAV per share €53.01 €54.23  Portfolio revaluation €35.2m €(19.1)  LTV 30.5% 35.4% Operational excellence Targets 2015  LFL gr

  4. Slide 4: Strategy

    Strategy Docks Vauban – Le Havre 4

  5. Slide 5: Management agenda 2015

    Management agenda 2015 Management agenda Current status Execute integration plan in France o Organisation in place (1 June 2015)  Completed, including hiring of MD France o Stabilising NRI French retail portfolio at €46m  Fully on track, H1 € 23m  Occupancy stable at 91% Continue strong operation

  6. Slide 6: 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

  7. Slide 7: Management agenda 2015/2016

    Management agenda 2015/2016 Continue strong operational performance o LFL rental growth > 100 bps above index o Occupancy 1 % up per year (base: 93.5 % after acquisition) Integrate acquisitions o NRI French retail stabilise at €46m in 2015 o LFL French retail > 100 bps above index in 2016 o NRI Dutc

  8. Slide 8: Operations

    Operations Saint Sever - Rouen 8

  9. Slide 9: Shopping centre visitors

    Shopping centre visitors (x 1,000) H1 2015 H1 2014 % growth Belgium 6,953 6,580 5.7% Finland 8,358 7,772 7.5% France 20,286 20,663 -1.8% Netherlands 19,160 18,862 1.6% Total 54,757 53,877 1.6%  Belgium: notable increase; mainly in Belle Ile, Genk and Les Bastions, Tournai  Netherlands: limited gro

  10. Slide 10: Occupancy

    Occupancy Occupancy Portfolio value* % / €m Q2 2015 Q1 2015 Q4 2014 Q2 2015 Belgium 94.9% 94.4% 94.6% 614 19.6% Finland 94.2% 93.1% 92.1% 627 20.0% France 91.1% 90.9% 91.2% 842 26.8% Netherlands 97.8% 97.7% 98.0% 700 22.3% Shopping centres 94.3% 93.9% 93.9% 2,783 88.7% Belgium 90.9% 91.6% 92.5% 127

  11. Slide 11: Net LfL rental growth shopping centres

    Net LfL rental growth shopping centres 150 bps above indexation 4.3% 0.5% 1.2% 2.0% 4.3% Above 1.5% Indexation 0.5% Indexation 0.2% 0.7% 0.3% 0.5% 0.0% Finland Belgium Netherlands Total 11

  12. Slide 12: Belgium

    Belgium Key parameters shopping centres H1 2015 H1 2014 Net rental income € 17.5m € 13.5m LfL 0.5% 3.5% Occupancy 94.9% 98.7% Valuation result 2.7% 0.3% NIY (EPRA) 5.5% 6.1% Standing investments € 637m € 382m Under construction € 23m € 100m Genk Shopping I  LfL NRI +0.5%, 20bps above indexation, im

  13. Slide 13: Finland

    Finland Key parameters shopping centres H1 2015 H1 2014 Net rental income € 14.5m € 13.5m LfL 4.3% 6.8% Occupancy 94.2% 99.2% Valuation result 0.6% 0.6% NIY (EPRA) 5.2% 5.2% Standing investments € 627m € 485m Under construction - € 108m  LfL NRI at +4.3%, 430bps above index, continues to be driven

  14. Slide 14: Netherlands

    Netherlands Key parameters shopping centres H1 2015 H1 2014 Foto sh centre Net rental income € 20.3m € 18.8m LfL 1.2% 1.0% Occupancy 97.8% 98.0% Valuation result - -1.1% NIY (EPRA) 5.8% 5.8% Standing investments € 723m € 674m Under construction € 23m € 12m Roselaar, Roosendaal  LfL NRI (+1.2%) perf

  15. Slide 15: France

    France Key parameters shopping centres H1 2015 H1 2014 Net rental income € 22.8m n.a. LfL - n.a. Occupancy 91.1% n.a. Valuation result 1.0% n.a. NIY (EPRA) 5.8% n.a. Standing investments € 843m n.a. Under construction - n.a. Docks Vauban, Le Havre  Management platform established. LfL NRI available

  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: Portfolio

    Portfolio Rivétoile - Strasbourg 17

  18. Slide 18: Acquisition NL shopping centres to close in Q3

    Acquisition NL shopping centres to close in Q3 Dominant shopping centres in larger provincial cities 1 Cityplaza1 2 Middenwaard 3 Tilburg Nieuwegein Heerhugowaard Tilburg Occ: 95%, GLA: 39,691m2 Occ: 94%, GLA: 35,715m2 Occ: 95%, GLA: 34,412m2 2 4 In de Bogaard2 5 Emiclaer 6 Presikhaaf 9 5 4 1 8 6 Ri

  19. Slide 19: Committed development pipeline

    Committed development pipeline Total Investment Capex Fully let % prelet Completion so far NIY Dutch redevelopment program (NL) 72 32 5.9% 2016 Dutch refurbishment capex 27 14 - 2016 Tournai (Bel) phase I, Retail Park 18 7 6.5-7.0% 43% Q1 2016 Total 117 52  Total investment Dutch projects forecaste

  20. Slide 20: Modernisation/refurbishment works

    Modernisation/refurbishment works New main entrance in Etten-Leur New kids plaza in Roselaar Retail Park, Tournai. a.i. New kids playground in ITIS 20

  21. Slide 21: Financials

    Financials Côté Seine – Argenteuil, Greater Paris 21

  22. Slide 22: Direct result

    Direct result (per share) € 0.75 € -0.08 € 0.08 € -0.19 € -0.02 € -0.49 € 0.06 € 2.11 € 1.51 € 1.62 € 1.62 H1 2014 Standing Acquisitions Disposals From Interest General costs Other H1 2015 portfolio development  Acquisitions: French retail portfolio, Ring Shopping Kortrijk, Koperwiek, Vier Meren an

  23. Slide 23: Indirect result

    Indirect result (per share) 0.02 -0.02 -0.20 -0.02 0.86 0.64 Valuation results Other income and Accrued interest Fair value adjustments Taxes/other Total indirect result expenses convertible derivates  Fair value adjustment derivatives: € -4.9m fair value change of option component in 1% convertibl

  24. Slide 24: EPRA NAV per share

    EPRA NAV ( per share) €-2.87 € 0.64 €-0.24 €-0.49 € 1.62 € 54.35 53.01 € 53.01 51.48 Q4 2014 Dividend €250m Direct Indirect Other H1 2015 share-issue result result -/- costs IFRS NAV* EPRA NNNAV*  Dec 2014: € 52.07  Dec 2014: € 52.19  Jun 2015: € 51.02  Jun 2015: € 51.46 * Reconciliation IFRS –

  25. Slide 25: Valuation

    Valuation Total investment properties* Revaluation H1 2015 EPRA NIY H1 2015 Shopping centres – In €m Q2 2015 Q4 2014 €m % % Belgium 637 616 16.4 2.7 5.5 Finland 627 605 3.6 0.6 5.2 France 843 831 8.4 1.0 5.8 The Netherlands 723 715 0.0 0.0 5.8 Total 2,830 2,767 28.4 1.0 5.6 Offices – In €m Belgium 1

  26. Slide 26: Income statement

    Income statement H1 2015 H1 2014 (x € 1,000) direct indirect direct indirect Gross rental income 97,339 - 63,547 - Service costs charged 20,644 - 10,975 - Total revenues 117,983 - 74,522 - Service costs paid -25,123 - -12,246 - Property expenses -6,599 - -4,481 - Total expenses -31,722 - -16,727 - N

  27. Slide 27: Debt profile

    Debt profile Meriadeck - Bordeaux 27

  28. Slide 28: Debt profile

    Debt profile Key parameters Q2-15 Q4-14 Covenants  Increase in interest bearing debt mainly due to funding of Kortrijk Interest bearing debt * € 1,465m € 1,261m acquisition and annual dividend payment in May Average cost of debt 2.3% 2.2%  Average cost of debt slightly increased to 2.3% Borrowing

  29. Slide 29: Outlook

    Outlook Eggert - The Netherlands 29

  30. Slide 30: Earnings outlook raised

    Earnings outlook raised +7-10% CAGR 2015-2016 +4-6% CAGR 2015-2016 2.97 2.87 + Direct result p/s compound average growth 7-10% for 2015 and 2016 + Dividend p/s compound average growth 4-6% for 2015 and 2016 2014 2015 2016 Payout gradually lowering to 85-90% Direct result per share Dividend per sha

  31. Slide 31: Q&A

    Q&A Roselaar- The Netherlands 31

  32. Slide 32: Appendix

    Appendix Itis - Finland 32

  33. Slide 33: 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€ 2.2bn  Property

  34. Slide 34: Portfolio composition

    Portfolio composition based on Investment Properties in Operation 11% 22% 24% 20% 34% 89% Belgium Finland France Netherlands Shopping Centres Offices 34

  35. Slide 35: 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

  36. Slide 36: Top 10 Tenants & Top 10 Properties

    Top 10 Tenants & Top 10 Properties Value % of % of Rank Tenant Rating Rank Property Sector JUNE rent Total 2015* 1 Coca Cola Enterprise 3.7% A+ 1 Itis (Helsinki, FIN) Shopping Centre € 627m 20.0% 2 H&M 3.6% 2 Docks 76 (Rouen, FRA) Shopping Centre € 185m 5.9% 3 Ahold 2.5% BBB 3 Rivétoile (Strasbourg,

  37. Slide 37: Lease expiry profile

    Lease expiry profile 1.1% 2.3% Offices 3.0% Shopping Centres 21.4% 19.4% 0.5% 0.3% 13.0% 0.2% 8.5% 7.8% 6.6% 3.9% 0.2% 5.0% 1.7% 2.4% 1.8% 0.9% 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 > 2024  Belgium 0.9% of retail expiries in 2015; 82% already renewed or re-let  Netherlands 1.4% of reta

  38. Slide 38: Our retailers: new store openings

    Our retailers: new store openings Desigual, AS Adventure, Tournai Belle-Ile Bubble Tea, Doppio, ITIS Eggert 38

  39. Slide 39: NAV reconciliation (IFRS – EPRA)

    NAV reconciliation (IFRS – EPRA) € per share IFRS NAV adjusted for rights-issue 51.02 Effect of conversion - Diluted NAV 51.02 Fair value derivatives 0.11 Deferred tax 1.88 Goodwill - EPRA NAV 53.01 Fair value derivatives -0.11 Fair value interest bearing debt -0.31 Deferred tax -1.13 EPRA NNNAV 51.

  40. Slide 40: CSR

    CSR Kronenburg – The Netherlands 40

  41. Slide 41: 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

  42. Slide 42: CSR progress

    CSR progress Progress Pillar Q2 2015 Further implementation improvement plans, “Night Walk” in ITIS BREEAM certificate Very Good received for Vier Meren, Koningshoek, Eggert, Bricks Gent Overpoort and ITIS Internal survey Dutch shopping centres on wasting energy Survey follow-up priority: better int

  43. Slide 43: Achieving Market Leadership in the Netherlands

    Achieving Market Leadership in the Netherlands Middenwaard – Heerhugowaard 43

  44. Slide 44: Strategic acquisition with value enhancing potential

    Strategic acquisition with value enhancing potential Acquisition of 9 Dutch shopping centres and 1 development project from Klépierre for €730m1  6.2% net initial yield2 providing headroom for value-enhancing opportunities  2.8% discount to CBRE valuation of €751m as of 15-May-2015 Opportune time

  45. Slide 45: Netherlands to become largest core market

    Netherlands to become largest core market Q1 2015 Post Acquisition 19% 22% 19% 25% 11% 15% 36% 15% 21% 9% Finland Netherlands Belgium France Paris 10 + 9 shopping centres 1 shopping centre 8 shopping centres 6 shopping centres 20,504 + 24,541 = 3 office buildings NLA: 104,000 m2 Average NLA: 16,325m

  46. Slide 46: Dutch macro fundamentals on the upturn

    Dutch macro fundamentals on the upturn GDP growth (%) Unemployment rate (%) 3.0 % NL Euro Area 15.0 % NL Euro Area 2.0 % 12.0 % 1.0 % 9.0 % 0.0 % 6.0 % (1.0)% 3.0 % (2.0)% 0.0 % 2011 2012 2013 2014E 2015E 2016E 2011 2012 2013 2014E 2015E 2016E Consumer confidence indicator Retail trade confidence in

  47. Slide 47: Portfolio matches our acquisition criteria

    Portfolio matches our acquisition criteria Target shopping Portfolio lies within our target area... ...and meets our acquisition criteria centres (#)  90% of shopping needs  Top-of-mind in catchment area  >100,000 inhabitants in 10 minutes drive  Easy accessibility  Strong (inter)national brand

  48. Slide 48: Complementary with our existing Dutch portfolio

    Complementary with our existing Dutch portfolio Owned leasable area per shopping centre (m2) 69,600 Existing Wereldhave portfolio Target portfolio 57,300 39,691 36,600 37,832 35,715 35,479 34,412 32,300 25,103 22,146 19,841 19,381 19,326 17,857 16,800 14,638 12,929 11,991 11,489 10,145 4,537 Citypla

  49. Slide 49: Key portfolio metrics

    Key portfolio metrics Number of assets 9 Tilburg Total Q1 2015 annualised NRI: €45.0m Total GLA (‘000m2) 258 €10.7m Average GLA (‘000m2) 29 €8.5m €6.4m €4.4m €4.2m €3.5m €2.6m €2.6m €2.0m Owned GLA (‘000m2) 221 Average owned GLA (‘000m2) 25 Weighted average occupancy: 94% Q1 2015 Annualised NRI (€m)

  50. Slide 50: Tenant and lease profile

    Tenant and lease profile The target portfolio has a well-diversified tenant base and staggered lease maturity profile Top 10 tenants based on annual rent Lease expiration schedule 19 % €m % 2.9 5.7 % 2.5 5.0 % 15 % 14 % 2.1 4.2 % 14 % 13 % 2.0 3.9 % 1.5 2.9 % 10 % 9% 1.4 2.8 % 6% 1.1 2.2 % 1.1 2.1 %

  51. Slide 51: Creating value through our operational expertise

    Creating value through our operational expertise Bottom up business plans per asset are in place and ready for execution  Focus on occupancy improvement leveraging our key tenant Particular relationships Leasing & focus on 6 re-tenanting  Increase number of units let to retail chains to > 75% cent

  52. Slide 52: Significant NRI growth potential

    Significant NRI growth potential Upside potential if the acquisition portfolio performance is brought in line with our existing Dutch portfolio Areas of focus Targeted goals / drivers  Limited indexation of max 1% p.a. Indexation  Average indexation in the Netherlands over the past 5 years has bee

  53. Slide 53: Driving occupancy through key account management

    Driving occupancy through key account management Leveraging our key account relationships and retailer-oriented approach to real estate Occupancy Top 5 key accounts Wereldhave Presikhaaf 86.0% 5.7% 7/9 8.6% Middenwaard 93.6% Sterrenburg 94.0% 5.0% 9/9 6.8% Cityplaza 94.7% 1.1% City Centre Tilburg 94

  54. Slide 54: Asset by asset business plans ready for execution

    Asset by asset business plans ready for execution Leasing & re-tenanting Shopping centre management Middenwaard Occupancy 93.6% Emiclaer Current GLA: 19,326m2 Objective: improve occupancy to 97% Objective: optimise shopping centre management  Increase percentage of units let to retail chains  Opti

  55. Slide 55: Asset by asset business plans ready for execution

    Asset by asset business plans ready for execution Asset rotation (Re)development Stadshagen 4% of NRI1 Presikhaaf Last renovation 1987 Objective: maximise value within holding period Objective: full renovation and repositioning  Extend leases and optimise tenant mix  Large scale refurbishment  Ad

  56. Slide 56: Redevelop Presikhaaf using experience gained in Kronenburg

    Redevelop Presikhaaf using experience gained in Kronenburg Distinguished offer in Arnhem KPIs Kronenburg 2012 - 2014 Occupancy 99.0% 98.0% Presikhaaf 96.0% Kronenburg L-f-L NRI growth 10.4% 4.9% 2.0% Kronenburg Presikhaaf  Positioning towards  Positioning towards Footfall (m) mid segment value-for

  57. Slide 57: Key terms of the transaction

    Key terms of the transaction Acquisition  Acquisition of nine shopping centres in The Netherlands  Purchase price of €730m, consisting of €687m for operational properties and €43m for the development  Total acquisition cost of €774m including RETT  NRI for operational properties of €45.0m1  Net

  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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