Slide 1: 2022 half-year results
2022 half-year results July 28, 2022
Slide 2: Preliminary remarks
Preliminary remarks The 2022 first-half consolidated financial statements were approved by the Board of Directors on July 27, 2022 A limited scope review of these financial statements has been performed by the statutory auditors 2
Slide 3: Contents
Contents 01 02 03 PHOTO A PHOTO A CHANGER CHANGER A new stage unfolding … with a strong Steady financial and in the history of operating business earnings profile Mercialys… model offering enabling reinvestment resilience in an inflationary context Page 4 Page 8 Page 18 3
Slide 4: A new stage unfolding in the history of Mercialys…
A new stage unfolding in the history of Mercialys…
Slide 5: Mercialys shows strong results and renewed investment capacity
Mercialys shows strong results and renewed investment capacity Mercialys has achieved strong results Mercialys’ asset values have been What’s next: with the combination of 3 factors: resilient, driven by the positive trend for • solid +5.3% organic growth, supported rents and the letting strategy, w
Slide 6: Marked shift in the shareholding structure, with best-in-class governance maintained
Marked shift in the shareholding structure, with best-in-class governance maintained Casino, an historical shareholder in Mercialys, Mercialys’ governance has been adapted to the change sold its remaining stake in Mercialys’ capital in April 2022 in the capital and remains structured around best pra
Slide 7: Mercialys shopping centers: diversified food store ownership
Mercialys shopping centers: diversified food store ownership At end-June 2022, Mercialys owns 5 food stores on a 100% basis and 20 food stores through partnerships. Mercialys’ economic exposure (1) to rent from retailers operated by the Casino group is 17.8% (vs 19.6% at end-2021). OWNERSHIP BREAKDO
Slide 8: …with a strong operating business model offering resilience in an inflationary context
…with a strong operating business model offering resilience in an inflationary context
Slide 9: Operating environment marked by strong economic headwinds
Operating environment marked by strong economic headwinds Several layers of international and specifically French disruptive triggers › French electoral context, with a historically recurrent impact on the consumption rate › Increased level of inflation, which spreads to rent indexation, but could a
Slide 10: Inflation impacting Mercialys’ third parties at still relatively moderate levels
Inflation impacting Mercialys’ third parties at still relatively moderate levels OVERALL INFLATION LEVELS IN FRANCE 6% AND CONTRIBUTION PER ITEM 5% 28.6% of rental income (1) Relatively moderate 4% 68.2% of rental income (2) inflation level in 3% 3.3% of rental income 2% sectors impacting 1% 0% of r
Slide 11: Strong fundamentals contributing to a sustained level of retailer sales
Strong fundamentals contributing to a sustained level of retailer sales › During the first half of 2022, business continued to › The performance figures in terms of › Mercialys outperformed the national be widely marked by various elements linked to shopping center footfall and retailer Quantaflow p
Slide 12: Marketing strategy focused on increasing footfall and offering useful revenue-generating tools for retailers…
Marketing strategy focused on increasing footfall and offering useful revenue- generating tools for retailers… Mercialys’ client base Activities and events offers wide coverage of designed to be major catchment areas traffic boosters _ Our Espace Anjou mall has +25% increase integrated 15% of Angers
Slide 13: …based on enhanced client knowledge…
…based on enhanced client knowledge… Cross-referencing Mercialys’ data analysis with their own data Mercialys has added a new feature enables our retailers to complete their customer knowledge - scanning receipts - to its loyalty program, and adjust their marketing actions locally – from product ena
Slide 14: …designing operations with measurable impacts
…designing operations with measurable impacts Timeslot operations In-store operations Drive-to-store operations Cap Sacré-Coeur Niort – Yves Rocher Brest Phare de l’Europe +25% footfall +44% average basket 67% return to stores June 2022 March 2022 May 2022 14
Slide 15: Balanced relationship with tenants mirrored in a low vacancy level and moderate occupancy cost ratio
Balanced relationship with tenants mirrored in a low vacancy level and moderate occupancy cost ratio › Steady decrease in the total vacancy rate since the H1 2021 peak of 5.7% to 4.4% at end-June 2022 › Further normalization in the collection of rents and charges in 2022 › Sustainable level of OCR a
Slide 16: Reversion stable despite rent increases generated by indexation
Reversion stable despite rent increases generated by indexation, reflecting the sustainability of Mercialys’ ERVs (1) LEASE EXPIRY SCHEDULE (percentage of leases expiring / guaranteed minimum rent at June 30, 2022) › 90 renewals and relettings completed in H1 2022 for €6.8m, Expired at Dec. 31, 2021
Slide 17: Strong organic growth of +5.3%, including a limited +1.9% indexation impact
Strong organic growth (1) of +5.3%, including a limited +1.9% indexation impact and positive operating trends +2.6% +3.7% +3.6% -7.0% +3.0% +5.3% IMPACTS IN H1 2022 +0.1% +0.3% › Positive trend for variable rent +1.4% › Renewed dynamic trend for +1.6% actions carried out on the portfolio +1.9% › Acc
Slide 18: Steady financial and earnings profile enabling reinvestment
Steady financial and earnings profile enabling reinvestment
Slide 19: Three-pronged refinancing operation carried out in Q1 2022
Three-pronged refinancing operation carried out in Q1 2022, largely consolidating the company’s liquidity €500m bond issue with a 2.5% coupon and 7-year maturity Make-whole option exercised for the €100m redemption of the early redemption of the March 2023 €300m bond issue maturing in bond with a re
Slide 20: Sound financial profile in terms of both liquidity and cost of debt
Sound financial profile in terms of both liquidity and cost of debt CHANGE IN DEBT MATURITY DEBT: FIXED VS. FLOATING RATE EXPOSURE (in years) 5.4 4.7 14% 13% 3.9 3.6 3.6 3.2 Fixed-rate debt Variable-rate debt 86% 87% H1 2021 2021 H1 2022 2021 H1 2022 Drawn debt maturity (1) Bond debt maturity (1) In
Slide 21: Level of debt enabling new investments
Level of debt enabling new investments CHANGE IN LTV AND ICR 70.0% 8.0x 6.1x 5.6x 5.1x 60.0% 6.0x 50.0% 4.0x › In H1 2022, Mercialys finalized the sale of the 38.3% 36.0% 36.7% 36.6% 40.0% 34.4% 34.3% 2.0x Géant Casino Annecy Seynod and Saint-Etienne 30.0% .0x Monthieu hypermarkets and isolated unit
Slide 22: Macroeconomic context leading to a balance between acquisitions and the development pipeline
Macroeconomic context leading to a balance between the acquisition of assets and the deployment of the development pipeline › Increased labor and raw material costs › Acquisition opportunities in the current market: portfolios or individual sites for shopping centers, retail parks and hypermarkets ›
Slide 23: Developments extended to include mixed-use projects and assets outside of the existing portfolio
Developments extended to include mixed-use projects and assets outside of the existing portfolio Only ~30% of projects are INVESTMENT STILL TARGET NET (€m) TOTAL TO BE RENTAL TARGET NET COMPLETION dependent on reaching an INVESTMENT YIELD ON COST DATE COMMITTED INCOME agreement with Casino as a join
Slide 24: Annecy
Annecy Short-term repositioning of the retail mix › Deeply evolving site, capitalizing on a growing catchment area with a political desire to desaturate the city center by supporting out-of- town commercial areas through investments in public transport › 2 projects currently underway to bring a new
Slide 25: Dijon (1/2)
Dijon (1/2) Phased rollout of the center’s repositioning… › Repositioning the mall as a benchmark multifunctional BEFORE center by restructuring it to adapt its classic 80s configuration by: ▼ refocusing the retail mix, restructured around the hypermarket’s short circuit and a merchandising mix gear
Slide 26: Dijon (2/2)
Dijon (2/2) …and a major medium-term urban regeneration project Today Medium term › In the medium term, development of a new hub, connected to Chenove city center and other major hubs in the south section 26
Slide 27: Sainte Marie Duparc (Reunion Island)
Sainte Marie Duparc (Reunion Island) Creating an iconic destination › Transforming and further strengthening the entire site by redeveloping it around its current footprint, while enhancing the current retail mix with additional uses (medical complex, leisure) Outline plans › Project objectives: ▼ c
Slide 28: Aix en Provence - Jas de Bouffan hub (1/2)
Aix en Provence - Jas de Bouffan hub (1/2) Integrating a retail site into its new urban environment › Capitalizing on a Mercialys landbank occupied by a medium-sized store and located at the crossroads between a calm residential neighborhood and an area identified as an economic hub marked for prior
Slide 29: Aix en Provence - Jas de Bouffan hub (2/2)
Aix en Provence - Jas de Bouffan hub (2/2) Integrating a retail site into its new urban environment › Mixed-use development, creating a high-quality link with the adjoining Saint- Mitre residential neighborhood 5 M€ 29
Slide 30: Saint André (Reunion Island)
Saint André (Reunion Island) Creating a 6,000 sq.m retail hub › Capitalizing on a landbank controlled by Mercialys, with over 3 hectares of space, in the Saint-André district (North East of Reunion Island, 20 mins from Saint-Denis) › Creating a 6,000 sq.m retail hub, combining medium-sized stores, l
Slide 31: Rental revenues up +2.1% despite scope impacts, through positive operating trends
Rental revenues up +2.1% despite scope impacts, through positive operating trends €84.7m €86.5m +2.1% Organic growth +5.3% + €1.1m Lease rights €0.4m + €1.3m + €0.1m + €0.2m Lease rights €1.2m - €1.6m + €1.6m - €0.1m €86.1m +3.2% €83.4m Rental revenues Acquisitions Strategic Indexation Contribution
Slide 32: FFO up +3.2% to €57.5m, in line with Mercialys’ 2022 objectives
FFO up +3.2% to €57.5m, in line with Mercialys’ 2022 objectives €0.60 €0.61 +1.6% /SHARE /SHARE EBITDA margin 87.0% €55.7m €57.5m +3.2% + €1.8m - €0.7m + €0.8m + €0.1m + €0.0m - €2.1m + €1.9m FFO Change in Change in Change in Change in Change in Change Change in FFO June 30, 2021 rental revenues non
Slide 33: Change in portfolio value at June 30, 2022
Change in portfolio value at June 30, 2022 Portfolio value at June 30, 2022: €2,930.2m excluding transfer taxes Change in portfolio value, excluding transfer taxes CHANGE ON A LIKE-FOR-LIKE BASIS (1) H1 2021 FY 2021 H1 2022 Of which rent effect -1.9% -2.8% +1.6% Of which yield effect -0.4% -0.2% +0.
Slide 34: Appraisers’ assumptions underlying portfolio values at end-June 2022
Appraisers’ assumptions underlying portfolio values at end-June 2022 6% 5% 4% 3% 2% 1% 0% -1% 2017 2018 2019 2020 2021 H1 2022 Mercialys' average "Prime" yield rate "Prime" yield rate appraisal yield rate for shopping centers in France (1) for all retail property in France (1) "Prime" yield rate "Pr
Slide 35: Change in EPRA NDV per share
Change in EPRA NDV per share (1) + €2.02 - €0.12 €19.65 EPRA NDV › €19.65/share › Up +11.6% over 6 months › Up +14.4% over 12 months + €0.44 €17.60 - €0.92 EPRA NRV (2) + €0.62 › €20.35/share Rent effect › Down -0.8% over 6 months + €0.50 › Up +0.2% over 12 months Yield effect + €0.03 (3) Other effe
Slide 36: 2022 objectives confirmed
2022 objectives confirmed excluding the health situation’s potential impacts on operations CHANGE IN FFO DIVIDEND PER SHARE POLICY Increase of at least Dividend ranging +2% vs. 2021 from 85% to 95% of 2022 FFO 36
Slide 37: Appendices
Appendices PIERCIALYS
Slide 38: Financial calendar
Financial calendar 2022 October 18 Activity at September 30, 2022 (after market close) 38
Slide 39: Company profile
Company profile Leading listed French real estate company €168.8m Annualized rental base that is a commercial real estate pure player › Mercialys' portfolio is focused on large and neighborhood shopping centers that are leaders in their areas 1.7% Average cost of drawn debt › Assets are concentrated
Slide 40: Rental income structure
Rental income structure CASINO GROUP LEASE SCHEDULE H&M GROUP LEASE SCHEDULE (main leases: hypermarkets, supermarkets & Monoprix stores) % held Lease Lease Lease Lease Site Type Lease characteristics Site Lease characteristics by Mercialys start date end date start date end date Grenoble 100% Monopr
Slide 41: Historical indicators
Historical indicators CURRENT FINANCIAL VACANCY RATE (1) ORGANIC GROWTH INCLUDING INDEXATION +5.3% 3.8% +3.7% +3.6% +3.0% 3.2% 2.9% 2.5% 2.5% -7.0% 2018 2019 2020 2021 H1 2022 2018 2019 2020 2021 H1 2022 EPRA NNNAV / NDV (2) LTV AND ICR (€/share) 7.4x 70.0% 8.0x 6.1x 21.14 60.0% 5.0x 5.0x 5.1x 6.0x
Slide 42: Shopping center portfolio structure
Shopping center portfolio structure NUMBER OF SHOPPING CENTERS AND AVERAGE VALUE 73.5 65.9 62.3 61.5 150 48.7 34.3 400 100 -100 50 69 59 58 48 49 50 0 -600 2012 2014 2016 2018 2020 H1 2022 Number of shopping centers in portfolio Average gross asset value of shopping centers (€m) SHOPPING CENTER BREA
Slide 43: Rental income structure
Rental income structure › Over 900 retailers and 2,130 leases BREAKDOWN OF MERCIALYS’ RENTAL INCOME BREAKDOWN OF MERCIALYS’ RENTAL INCOME BY TYPE OF RETAILER BY TYPE OF RETAILER ECONOMIC EXPOSURE CONSOLIDATED VISION (% of annualized rental income) (% of annualized rental income) Actual economic 64.4
Slide 44: Mercialys’ sustained work on ESG stakes is reflected in its global rankings
Mercialys’ sustained work on ESG stakes is reflected in its global rankings Score: 89/100 2022: Best BPR Score: 89/100 Rating: A #1 in its Rating: B- Score: 85/100 AGM Brochure Gold Award 2021 Green Star A List status category Score: 9.1 Rating: A Prime status #3 on sBPR status maintained Member of
Slide 45: EPRA performance indicators
EPRA performance indicators JUNE 30, 2021 DECEMBER 31, 2021 JUNE 30, 2022 EPRA earnings - € per share 0.60 1.10 0.61 EPRA NRV - € per share 20.32 20.51 20.35 EPRA NTA - € per share 18.26 18.39 18.24 EPRA NDV - € per share 17.17 17.60 19.65 EPRA net initial yield - % 5.26% 5.24% 5.26% EPRA “topped-up
Slide 46: FFO & EPRA earnings
FFO & EPRA earnings IN THOUSANDS OF EUROS JUNE 30, 2021 JUNE 30, 2022 Invoiced rents 83,419 86,087 Lease rights 1,246 364 Rental revenues 84,665 86,450 Property taxes -13,775 -13,310 Rebilling to tenants 12,170 11,432 Non-recovered property taxes -1,606 -1,878 Service charges -16,373 -16,455 Rebilli
Slide 47: Net income attributable to owners of the parent
Net income attributable to owners of the parent IN THOUSANDS OF EUROS JUNE 30, 2021 JUNE 30, 2022 FFO 55,694 57,461 Depreciation and amortization -19,557 -18,622 Other operating income and expenses -5,579 -432 Impact of hedging ineffectiveness, banking default risk and bond redemptions 683 -25,959 S
Slide 48: Balance sheet
Balance sheet IN THOUSANDS OF EUROS DECEMBER 31, 2021 JUNE 30, 2022 Intangible assets 5,028 4,214 Property, plant and equipment other than investment property 6,922 4,189 Investment property 1,935,117 1,921,342 Right-of-use assets 8,590 10,032 Investments in associates 37,907 37,368 Other non-curren
Slide 49: Breakdown of assets
Breakdown of assets Average appraisal yield rate: 5.71% at June 30, 2022 APPRAISAL VALUE APPRAISAL VALUE NUMBER GROSS LEASABLE AREA APPRAISED NET (EXCL. TRANSFER TAXES) (INCL. TRANSFER TAXES) JUNE 30, 2022 RENTAL INCOME OF ASSETS JUNE 30, 2022 JUNE 30, 2022 TYPE OF PROPERTY JUNE 30, 2022 €m % €m % s
Slide 50: Disclaimer
Disclaimer › This communication contains forward-looking information and statements about Mercialys. Forward-looking statements are statements that are not historical facts. These statements include financial projections and estimates and their underlying assumptions, statements regarding plans, obj