Immobiliare Grande Distribuzione SIIQ S.p.A. · MIL:IGD
Immobiliare Grande Distribuzione SIIQ — IGD SIIQ — H1 2020 Earnings Presentation
45 slides from Immobiliare Grande Distribuzione SIIQ's earnings presentation, Aug 6, 2020
Slide 1: 1H2020 Results
1H2020 Results 6 August 2020
Slide 2: Disclaimer
Disclaimer This presentation does not constitute an offer or an These statements include financial projections and invitation to subscribe for or purchase any securities. estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect The securities r
Slide 3: Business strongly affected, but also strongly resilient
Business strongly affected, but also strongly resilient COVID-19: main events in Italy 23-24 Feb Since 12 Mar OPERATING ITALIAN ASSETS: Since 18 May First restrictive Lockdown Easing of the measures Restrictions on the HYPER (25%* of tot. rents) + restrictions, activities in Milan area whole of the
Slide 4: Highlights (1/2)
Highlights (1/2) Rental Income Net Rental Income €74.6 mn €56.3 mn -3.5% -17.9% Core Business Ebitda Funds From Operations (FFO) €51.4 mn €32.9 mn -18.3% -21.4% (0.30€ p.s.) Include estimate of the Covid-19 one-off impact on 1H (no further impact on the subsequent years) 4
Slide 5: Highlights (2/2)
Highlights (2/2) Real Estate Portfolio Epra NAV and EPRA NRV Market Value (excluding leasehold) €2,322.62 mn €10.81 p.s. -2.5% -5.1% Epra NTA Epra NDV €10.70 p.s. €11.35 p.s. -5.2% +5.0%* *Thanks to the increase in financial instruments fair value 5
Slide 6: Operating performances
1 Operating performances
Slide 7: Priority given to health and safety
Priority given to health and safety Thermal camera Access and routes Strenghtened Sanitation Informative panels and temperature regulation surveillance control Increase in 80 THERMAL In order to monitor Informative panels to Rules to enter in the cleaning of the CAMERAS* compliance with the provide
Slide 8: Turning a need into a future opportunity
Turning a need into a future opportunity Thermal cameras high technology could be used in the future for: 1. Flow analysis to check the «hot/cold» areas of the shopping centers – pilot project at ESP Shopping Center (Ravenna) 2. Shopping center customers clusterization 3. Footfalls counting; monitor
Slide 9: Enhancement of the communication to visitors
Enhancement of the communication to visitors 1. Reconnecting and 2. New sales 3. Tenants informing promotions new initiatives Communication campaign Initiatives in all our Tenants’ specific initiatives (e.g. on local press and shopping centers starting outdoors dehors for restaurants) social network
Slide 10: Government measures to support tenant in Italy
Government measures to support tenant in Italy The Government adopted some fiscal measures regarding rents: TAX CREDIT* 60% or 30% (Limits: Annual IGD POTENTIAL RECIPIENTS Revenues<5mn To be applied Turnover -50%) on fully paid % on Revenues <5mn Revenues >5mn rents for the 30% n. of tenants 70% mon
Slide 11: Leasing activities Italy: malls
Leasing activities Italy: malls Ongoing negotiations with tenants to manage the lockdown period with a view to mutual sustainability 1H includes Tenants 717 Closed estimate of negotiations** 70% Covid-19 Contracts 1,449 one-off impact 65.8% for -8.5 mn €* of total rents In general no changes to exis
Slide 12: Leasing activities Italy: hypermarkets
Leasing activities Italy: hypermarkets • Always operating during lockdown • Enhancing the shopping centers service role in 25.8% of total their catchment areas rents No impacts on existing contracts and proceeds 1° and 2° QUARTER Quarterly BOP invoicing INVOICING AND Collected 100% COLLECTION 12
Slide 13: Leasing activities Romania
Leasing activities Romania Ongoing negotiations with tenants to manage the lockdown period with a view to mutual sustainability In 1H granted Tenants 380 temporary Closed negotiations 98% reductions Contracts 539 mainly on April and May rents 5.2% for approx. of total rents € 1mn No changes to exist
Slide 14: Rental Income
Rental Income (€mn) -€2.7mn -€11.2mn -3.5% -14.5% -1.3 -0.4 -1.0 -8.5 77.3 74.6 66.1 Rental Income Change in like-for- Non like-for-like Change in like-for- Rental Income Internal estimate Rental Income net 1H2019 like Italy Italy like Romania 1H2020 COVID impact of COVID impact 1H2020 Malls: Asset
Slide 15: Net Rental Income
Net Rental Income (€mn) -€3.8mn Italy -€12.3mn -5.5% -17.4% -17.9% Romania -25.2% -2.7 -1.1 -8.5* 68.6 64.8 56.3 Net rental income 1H2019 Change in rental income Change in rental costs Net rental income 2020 adj Internal estimates COVID effect Net rental income 1H2020 *the estimates of COVID impact
Slide 16: The operativeness and occupancy in Italy
The operativeness and occupancy in Italy OPENED AT 30 JUNE 2020 98.2% IN TERMS OF GLA OPERATING of TENANTS which PRE-LOCKDOWN IN TERMS OF 97.7% TOTAL RENTS FINANCIAL OCCUPANCY at 30/06 confirmed at high levels: 95.6% 16
Slide 17: Footfalls in Italy (1/2)
Footfalls in Italy (1/2) Weekly footfalls 2020/2019 Recovered approx. 85% of Δ the pre-lockdown footfalls 18-24 May 27July-2August 18-24 May/ 27Jul-2Aug Penalized time slot: lunch and post work +31.9% -15.0% Contingent factors that are affecting trends: We ekly change -31.4% Progressive change -22.7
Slide 18: Footfalls in Italy (2/2)
Footfalls in Italy (2/2) Return to physical Safety in our shopping after the shopping centers lockdown Obvious increase in online shopping during the lockdown, followed by return to physical Over 80% of respondents said they felt shopping after the end of restrictions; also safe and protected by the
Slide 19: Tenant sales in Italy: increase in average ticket
Tenant sales in Italy: increase in average ticket June tenant sales News -13.6% Decreased less than footfalls The Government is → Higher average ticket studying measures to €26.6 (+€4.1; +18.1% vs 2019) boost consumption Some product categories performed better compared to 2019 (June tenant sales) *
Slide 20: The operativeness in Romania
The operativeness in Romania OPENED AT 30 JUNE 2020 94.0% IN TERMS OF GLA OPERATING of TENANTS PRE- which LOCKDOWN IN TERMS OF 97.0% TOTAL RENTS FINANCIAL OCCUPANCY at 30/06 confirmed at high levels: 94.7% Post lockdown FOOTFALLS: -25% 20
Slide 21: Sustainability
Sustainability Sustainable mobility Certifications EPRA Best practice Puntadiferro s.c. became the city ISO 14001 In the report “Enhancing hub for sustainable mobility 4 more certififications transparency with the TCFD”, Supercharger Standard obtained in 2020 published by EPRA on 30 June charging ch
Slide 22: The Portfolio
3 The Portofolio
Slide 23: IGD Market value
IGD Market value Gross Initial EPRA Net Initial EPRA Net Initial FY 2019 1H 2020 Δ% Yield Yield Yield topped up Malls Italy 1,555.50 1,513.36 (-2.71%) 6.84% 5.4% 5.5% Hypermarkets Italy 583.62 575.75 (-1.35%) 6.12% Romania 150.29 142.22 (-5.37%) 7.44% 6.0% 6.2% Porta a Mare + development + other 91.
Slide 24: IGD Portfolio
IGD Portfolio ITALY ROMANIA € 2,381.4mn Other 3.9% 4.5 (91.99 €mn) Romania 6.3% -55.2 € 2,322.6mn (150.29 €mn) 3.4 -3.4 0.2 -8.3 Other 3.9% (91.29 €mn) Romania 6.1% (142.22 €mn) The FV change for approx. 28% is due to DCF Malls 65.3% assumptions (rates) and for approx. 72% to change in Malls 2,381.4
Slide 25: Capex and on-going projects
Capex and on-going projects In order to strenghten the Group’s financial solidity, several capex and projects have been suspended for a total savings of around €40mn vs forecasts. Resumption of work is currently being evaluated Porta a Mare: work is underway to protect the construction work done, al
Slide 26: Financial results
4 Financial results
Slide 27: Core business Ebitda
Core business Ebitda (€mn) -€3.0mn -€11.5mn -4.8% -18.3% -3.8 0.2 0.6 -8.5 * Decrease in G&A expenses 62.9 (-9.7%) 59.9 thanks to costs cutting 51.4 activities Ebitda 1H2019 Net rental income Net service income Change in G&A expenses Ebitda 2020 adj Internal estimate COVID Ebitda 1H2020 impact EBITD
Slide 28: Financial management
Financial management (€mn) Figures, net of accounting items and negative carry related to the last bond issue, are further decreasing (-9.8% vs 1H2019) Total Totale Total Totale 16,4€mn € 16.4mn 18,0€mn € 18.0mn -9.8% Negative carry 2.7 €400mn bond issue 1.0 1.3 IFRS16 and non-recurring charges 15.4
Slide 29: Funds From Operations (FFO)
Funds From Operations (FFO) -€0.5mn -€9.0mn -1.1% -21.4% -2.1 1.5 0.1 -8.5 41.8 41.4 32.9 FFO_1H2019 Change in core Change in Financial Change in taxes and FFO_2020 adj Internal estimate FFO_1H2020 business Ebitda Adj* management Adj** other COVID impact 29 *Change Ebitda Adj: equal to core business
Slide 30: EPRA Metrics
EPRA Metrics € per share 1H2020 FY 2019 Δ% NRV and NAV 10.81 11.40 -5.1% NTA 10.70 11.29 -5.2% Thanks to NDV 11.35 10.81 +5.0% the increase in financial instruments fair value 0.30 -0.23 -0.67 0.00 11.40 10.81 EPRA NRV/NAV 31 Dec Resolved dividend FFO Change in assets fair Change in debt fair EPRA N
Slide 31: Update on financial activities
Update on financial activities Committed credit lines A government Ratings: renewed by 2 leading guaranteed loan of credit institutions (40 roughly €37 million (6- Fitch mn€ +20 mn€) and years at a rate, including BBB- rating watch negative maturity extended to the cost of the 2023 government guaran
Slide 32: Financial structure
Financial structure 31/12/2019 30/06/2020 LTV 47.6% 49.0% (adj. IFRS16 c. 46.4%) (adj. IFRS16 c. 47.9%) ICR 3.8X* 3,5X* Average cost of 2.35% 2.30% debt NET DEBT €1,165.6 mn** DEBT BREAKDOWN*** SECURED MARKET 27.4% 56.7% BANKING SYSTEM L.T. 1,218.33 43.3% S.T. UNSECURED 50.19 72.6% CASH -102.96 * Ex
Slide 33: Debt maturity
Debt maturity Thanks to liability management activities carried out over the last few months and ongoing, the committed and uncommitted credit lines for €220 mn and the cash-on-hand for €103 mn, the Group is capable to cover next 18 months financial maturities €100mn: 2.25% 7y €400mn: 2.125% 5y 2.1%
Slide 34: Outlook
4 Outlook
Slide 35: FFO Outlook 2020
FFO Outlook 2020 FFO p.s. -25/28% vs FY2019 (c. €0.54/€0.57) FY2020 (Includes estimate of Covid-19 one-off impact; no effects on the subsequent years NEW OUTLOOK are expected) Given this backdrop, the 2021 targets for the Business Plan 2019-2021 (presented on 7 November 2018) should no longer be con
Slide 36: Attachments
5 Attachments 36
Slide 37: Consolidated Income Statement
Consolidated Income Statement (a) (b) Δ GROUP CONSOLIDATED 1H_CONS_2019 1H_CONS_2020 (b)/(a) Revenues from freehold rental activities 71.1 68.7 -3.4% Revenues from leasehold rental activities 6.3 5.9 -5.2% Total income from rental activities 77.3 74.6 -3.5% Rents and payable leases -0.1 0.0 -96.5% D
Slide 38: Contracts in Italy and Romania as at 30/06/2020
Contracts in Italy and Romania ad at 30/06/2020 N 136 N 207 N 219 N 887 Average residual maturity: 4.1years Malls Italy Total contracts: 1,449 of whic 42 renewals 67.9% with the same tenant and 37 signed with a new tenant 8.4% 12.5% 11.3% Rotation Rate 2.7% (% new contracts on tot. contracts) 2020 2
Slide 39: Key tenants
Key tenants Product Turnover Product Turnover TOP 10 Tenant Contracts TOP 10 Tenant Contracts category impact category impact clothing 2.8% 13 supermarket 10.6% 11 clothing 2.5% 9 clothing 7.2% 6 clothing 2.1% 10 clothing 4.5% 10 shoes 2.0% 8 Top 10 clothing 4.4% 11 Top 10 Tenants Tenants personal c
Slide 40: Funds From Operations (FFO)
Funds From Operations (FFO) Funds from Operations CONS_2019 * CONS_2020 Δ 1H 2019 Δ% Core business EBITDA 62.9 51.4 -11.5 -18.3% IFRS16 Adjustments (Payable leases) -5.1 -4.3 0.8 -15.7% Financial Management adj. -15.5 -16.6 -1.2 7.7% Extraordinary Management adj. 0.0 0.0 0.0 n.a. Current taxes for t
Slide 41: Other Epra metrics
Other Epra metrics EPRA Performance Measure 6/30/2020 12/31/2019 EPRA NRV/NAV (€'000) 1,193,288 1,258,008 EPRA NRV/NAV per share € 10.81 € 11.40 EPRA NTA 1,180,764 1,245,473 EPRA NTA per share € 10.70 € 11.29 EPRA NDV 1,252,303 1,192,894 EPRA NDV per share € 11.35 € 10.81 EPRA Net Initial Yield (NIY
Slide 42: Further financial highlights
Further financial highlights 31/12/2019 30/06/2020 Gearing ratio 0.95X 1.0X (adj. IFRS16 c. 0.91X) (adj. IFRS16 c. 0.96X) Average lenght of long term debt 4.1 years 3.6 years Hedging on long term debt + bond 94.8% 95.1% Share of M/L debt 95.4% 89.3% Uncommitted credit lines granted 161 € mn* 161€ mn
Slide 43: Reclassified balance sheet
Reclassified balance sheet Sources - Uses of funds (€/000) 6/30/2020 31/12/2019 Δ Δ% Fixed assets 2,300,570 2,365,214 64,644 2.8% Assets under construction 40,610 40,827 217 0.5% Other non-current assets 21,552 21,845 293 1.4% Other non-current liabilities -28,250 -28,998 -748 2.6% NWC 19,094 18,441
Slide 44: Government measures to support tenants in Italy
Government measures to support tenants in Italy • Tax credit equal to 60% of the March rent if the Only 39% of lease contracts, equal Measures provided leased property falls into the cadastral category to 7% of total contracts, can by the «Cura Italia» C/1 benefit from this measure Decree • Tax cred
Slide 45: Investor relations contacts
Raffaele Nardi, Director of Planning, Control and investor relations T. +39. 051 509231 Raffaele.nardi@gruppoigd.it Claudia Contarini, IR T. +39. 051 509213 claudia.contarini@gruppoigd.it Elisa Zanicheli, IR Team T. +39. 051 509242 elisa.zanicheli@gruppoigd.it Federica Pivetti, IR Team T. +39. 051 5