Grand City Properties Sa · XETR:GYC
Grand City Properties Sa — H1 2023 Earnings Presentation
31 slides from Grand City Properties Sa's earnings presentation, August 2023
Slide 1: Financial Results Presentation Q2 2023
Cologne FINANCIAL RESULTS PRESENTATION Q2 2023 August 2023
Slide 2: Financial Highlights, Portfolio Highlights
FINANCIAL HIGHLIGHTS PORTFOLIO HIGHLIGHTS SOLID LIKE-FOR-LIKE RENTAL GROWTH Net rental income €204m +5% FFO I Adjusted EBITDA €160m €94m +5% -3% FFO I per share €0.54 CONTINOUSLY DELIVERING OPERATIONAL PERFORMANCE -8% In-place rent Vacancy (in €/sqm) Investment EPRA NTA +5.2% -2.3% CAGR 6.2% Propert
Slide 3: Highlights
HIGHLIGHTS WELL POSITIONED IN CURRENT ENVIRONMENT WITH HIGH HEADROOM TO BOND COVENANTS DISPOSALS NEW BANK FINANCING STRONG LIQUIDITY POSITION €210m €230m Cash and liquid assets amount to H1 2023 signed Signed Q3 2023 18% of total debt and cover debt €130m €250m (of which €190m drawn in H1) €714m mat
Slide 4: Operational Profitability
OPERATIONAL PROFITABILITY Selected consolidated statement of profit or loss H1 2023 H1 2022 in € ‘000 unless otherwise indicated Revenue 309,401 272,092 Net rental income 204,403 194,586 NET RENTAL INCOME ADJUSTED EBITDA (in € millions) (in € millions) Property revaluations and capital gains (538,84
Slide 5: FFO I + II
FFO I + II FFO I FFO I per share (in € millions) (in €) -3% in € ‘000 unless otherwise indicated H1 2023 H1 2022 -8% 97 94 Adjusted EBITDA 159,596 152,264 0.59 0.54 Finance expenses (27,342) (23,006) Current tax expenses (20,294) (18,530) Contribution to minorities (2,536) (1,299) H1 2022 H1 2023 H1
Slide 6: EPRA NAV Metrics
EPRA NAV METRICS EPRA NAV PER SHARE METRICS (in €) EPRA NAV METRICS (in € millions) EPRA NRV PS EPRA NTA PS EPRA NDV PS EPRA NRV EPRA NTA EPRA NDV -8% -9% -10% -8% -8% -10% 30.8 5,323 28.3 4,878 4,642 27.0 26.9 4,656 24.7 4,267 4,178 24.2 reclassified to reclassified to exclude RETT exclude RETT Dec
Slide 7: Portfolio Overview
Berlin PORTFOLIO OVERVIEW INVESTMENT PROPERTY ANNUALISED NET RENTAL (in € millions) INCOME vs. -6% MARKET POTENTIAL (ERV) (INCLUDING VACANCY REDUCTION) 9,530 (in € millions) 8,990 +17% 465 398 ❖ In addition to the portfolio below GCP has investment property held for sale amounting to ~€200 million,
Slide 8: Valuation Update
VALUATION UPDATE GCP VALUE incl. land VS REPLACEMENT COST excl. land (Excl. London & in € per sqm) 4,200 ❖ In H1 2023, GCP recorded a like-for-like valuation change of -5.4% excluding capex (-4.8% including capex) using external valuators, compared to the year GCP values remain materially below end
Slide 9: Maintenance & Capex
MAINTENANCE & CAPEX BEFORE Cologne (NRW) REPOSITIONING CAPEX REPOSITIONING CAPEX & MAINTENANCE (in € per average sqm) - Focus remains on improving asset quality - All capex is directed towards value creation - Other value-add measures include: 11.9 10.9 - Upgrading apartments for new rentals - Enhan
Slide 10: Financial Policy
FINANCIAL POLICY GCP FINANCIAL POLICY GCP REMAINS COMFORTABLY ABOVE ITS BOND COVENANTS LTV limit at 45% Overview of Covenant Package Covenant Type GCP Covenant limit and H1 2023 results Stress Case Debt to debt plus equity ratio at 45% (or lower) on a sustainable basis Limitation on Debt ✓ 33% -43%
Slide 11: Strong Financial Profile
STRONG FINANCIAL PROFILE FINANCING SOURCES MIX LOW LEVERAGE INTEREST HEDGING RATIO Wuppertal Fixed & Swapped 3% 5% LOW LTV Bank Debt Capped 45% Board of Directors’ Limit 9% Variable 4% 37% 35% Straight Bond EPRA LTV 36% 36% NET DEBT/ (including perpetual EBITDA notes as debt) 60% 60% Equity 47% 10.4
Slide 12: Debt Maturity Schedule
DEBT MATURITY SCHEDULE CURRENT AVERAGE DEBT 1,400 COST OF DEBT MATURITY 1.6% 5.7 years 1,200 1,000 June 2023 Cash and liquid assets cover debt maturities until Q2 2026 EUR Millions 800 600 400 200 0 CURRENT COST OF 1.2% 1.3% 1.3% 1.5% 1.0% 3.3% 2.6% 4.0% 1.8% 2.5% MATURING DEBT 2023 2024 2025 2026 2
Slide 13: Updated Guidance
UPDATED GUIDANCE FY 2023 FFO I 175M – 185M FFO I per share (in €) 1.01 - 1.07 GUIDANCE INCREASED Dividend per share (in €)* 0.76 - 0.80 Total net rent like-for-like growth >2% LTV <45% Leipzig * The dividend will be subject to market condition and AGM approval FFO drivers: ❖ Low single digit adj. EB
Slide 14: Appendix
APPENDIX GCP
Slide 15: Diversified Portfolio with High Growth Potential
DIVERSIFIED PORTFOLIO WITH HIGH GROWTH POTENTIAL 15
Slide 16: Focus on Central Locations in Berlin and NRW
FOCUS ON CENTRAL LOCATIONS IN BERLIN AND NRW* BEST IN CLASS BERLIN PORTFOLIO WELL DISTRIBUTED NRW PORTFOLIO 24% of GCP’s Portfolio Value 4th Largest city in Germany 70% of the Berlin portfolio is 21% located in top tier of GCP’s neighborhoods: Portfolio Charlottenburg, Wilmersdorf, Mitte, Kreuzberg,
Slide 17: High Quality London Portfolio
HIGH QUALITY LONDON PORTFOLIO* 18% of GCP’s WELL CONNECTED ❖The total London portfolio, including pre-marketed units, consists of Portfolio LONDON PORTFOLIO approx. 3,600 units ❖Over 80% of the portfolio is situated within a short walking distance to an underground/overground station ❖Through strong
Slide 18: Quality East and North Portfolio
QUALITY EAST AND NORTH PORTFOLIO QUALITY EAST PORTFOLIO QUALITY NORTH PORTFOLIO DRESDEN/LEIPZIG/HALLE HAMBURG / BREMEN 14%* 5%* of GCP’s of GCP’s Portfolio Portfolio DIVERSIFICATION INTO GERMANY’S DYNAMIC WELL POSITIONED IN Leipzig & Dresden EASTERN CITIES WITH GERMANY’S LARGEST are the largest citi
Slide 19: Perpetual Notes Refresher
PERPETUAL NOTES REFRESHER January 2023 Perpetual Notes Decision Characteristics Perpetual Notes ❖ At the end of 2022, GCP announced its decision not to call the €200 million perpetual notes series which had its first call date in January 2023. No maturity Full optionality No covenants ❖ GCP made thi
Slide 20: ESG and Sustainability
ESG AND SUSTAINABILITY ENHANCED REPORTING In order to effectively address the varied interests and priorities of our business partners, investors, tenants, employees and communities NON-FINANCIAL REPORT SUSTAINABILITY INSIGHTS based on 12 topics identified as material in GCP’s materiality externally
Slide 21: ESG Goals and Contribution
ESG GOALS AND CONTRIBUTION 21
Slide 22: Environment
ENVIRONMENT GOING FORWARD Essen Halle Create and deliver a portfolio wide CO2 reduction pathway report by energy auditing the environmental performance of buildings such as the use of energy, waste and water. Continue to switch the electricity supply of all common areas to PPA (Power Purchase Agreem
Slide 23: Social
SOCIAL TENANTS GCP FOUNDATION EMPLOYEES LOOKING FORWARD GCP values diversity – a fact that is also Entertaining, diverse, convincing: GCP From Dortmund to Halle, from Bremen to underlined with almost 40 nations creates attractive digital alternatives to Mainz: Support for charitable projects represe
Slide 24: Governance
GOVERNANCE 1 BEST-IN-CLASS REPORTING LEADING TO HIGH STANDARDS OF TRANSPARENCY - For the SIXTH CONSECUTIVE year in September 2022, GCP received the EPRA BPR and sBPR gold awards for its financial reporting and sustainability reporting, respectively. 2 EXPERIENCED LEADERSHIP WITH STRONG AND INDEPENDE
Slide 25: Analyst Coverage
ANALYST COVERAGE 26.2 15 12.8 12 11.75 10.6 9.2 9 8.5 8.2 8 8 7.5 7 6.5 Citigroup Kepler Cheuvreux First Berlin HSBC J.P. Morgan DZ Bank Societe Generale Berenberg UBS Oddo BHF Deutsche Bank Bank of America Goldman Sachs Barclays Kempen & co 13.03.2023 29.03.2023 17.05.2023 10.05.2023 09.12.2022 17.
Slide 26: Share Development & Ownership Structure
SHARE DEVELOPMENT & OWNERSHIP STRUCTURE 26 GCP - SHARE PRICE AND TOTAL RETURN SINCE FIRST EQUITY PLACEMENT (19.7.2012) 26 24 Grand City Properties 248% 22 SDAX (rebased) 167% 20 18 16 14 12 FTSE EPRA/NAREIT Germany (rebased) 56% 10 Issue price 8 €2.75 6 4 2 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14 Jan-15
Slide 27: Management
MANAGEMENT Refael Zamir Mr. Zamir is the Chief Executive Officer of Grand City Properties since 2020 (and Daily Manager (administrateur-délégué)). Mr. Zamir has been working for the Group since 2013. He served as Chief Chief Executive Officer Financial Officer from 2014 to 2023 and as Chairman of th
Slide 28: Management
MANAGEMENT Senior Management (continued) Michael Bar-Yosef Mr. Bar-Yosef is responsible for financial modeling and cooperates with equity researchers to analyze their financial models and has more than 10 years of experience. Before joining GCP he served as Senior Financial Analyst a financial and c
Slide 29: Business Risk Profile
CREDIT RATING MATRIX FINANCIAL RISK PROFILE 1 2 3 4 5 6 MINIMAL MODEST INTERMEDIATE SIGNIFICANT AGGRESSIVE HIGH LEVER-AGED 1 aaa/ GCP will continue strengthening its position within the business profile EXCELLENT aa a+/a a- bbb bbb-/bb+ BUSINESS RISK PROFILE aa+ (Vonovia- BBB+)1 2 (GCP) (Aroundtown)
Slide 30: Disclaimer
DISCLAIMER IMPORTANT: This presentation has been provided for information purposes only and is being circulated on a confidential basis. This presentation shall be used only in accordance with applicable law, e.g. regarding national and international insider dealing rules, and must not be distribute
Slide 31: Thank You
THANK YOU Investor Relations Team E-mail: gcp-ir@grandcity.lu www.grandcityproperties.com
Grand City Properties — H1 2023 Earnings Presentation on 6ix