Slide 1: 2019 Annual Results
0) a (=) N 7) 5 =) n rf oc ol <x =) 2 2 <q ALTAREA
Slide 2: Disclaimer
Disclaimer This presentation has been prepared for information purposes only, and is intended to supplement other information published by Altarea, to which readers are encouraged to refer. It is not, and must not be interpreted as a solicitation, recommendation or offer to purchase, sell, exchange
Slide 3: 2019 Annual Results agenda
01 INTRODUCTION 02 OPERATIONAL PERFORMANCE 2019 ANNUAL RESULTS 03 FINANCIAL PERFORMANCE 04 OUTLOOK EXISTEN CIEL – Lyon (69) 3
Slide 4: Introduction
01 INTRODUCTION RICHELIEU – Paris (75) 2019 ANNUAL RESULTS 4
Slide 5: Paris-Richelieu: a top-of-the-art head office
Paris-Richelieu A top-of-the-art head office 2014 2019 1,300 employees 2,045 employees €1.3 bn of revenue €3.1 bn of revenue Acquisition option signed in October 2014 Altarea new head office delivered in 2020 2019 ANNUAL RESULTS 5
Slide 6: A new brand architecture
A new brand architecture Altarea embodies the strength and values of the Group A structure designed to COMMERCE LOGEMENT COMMERCE ENTREPRISE support city transformation More operational autonomy for each brand 2019 ANNUAL RESULTS 6
Slide 7: An unrivalled platform of skills
An unrivalled platform of skills Creativity 2,045 Commitment professionals Expertise Development Building at the forefront the city HIGH GARDEN – Rueil Malmaison (92) 2019 ANNUAL RESULTS 7
Slide 8: An outstanding pipeline of projects €19.8 billion
An outstanding pipeline of projects Consolidated pipeline Residential, Business Property and Retail €19.8 billion of potential value 690 projects 4.6 million m² Altarea, leading property developer in France 2019 ANNUAL RESULTS 8
Slide 9: Ahead in the implementation of its road map
Ahead in the implementation of its road map Guidances (1) (reminder) ROAD COMMERCE LOGEMENT COMMERCE ENTREPRISE 2019 FFO €17.50 to €17.70 per share MAP Selective Market Refilling allocation shares the 2020 FFO of capital gains pipeline ≈ €300 m Last “galeries” Multi-brand 15 new projects 2019 FFO so
Slide 10: Operational Performance
02 OPERATIONAL PERFORMANCE BEZONS CŒUR DE VILLE – Bezons (95) 2019 ANNUAL RESULTS 10
Slide 11: Retail: a selective allocation of the Group's equity
Retail: a selective allocation of the Group’s equity Focussing on 4 types of assets Regional shopping centres: destination areas Travel retail: natural footfall Retail parks: an effective price/product ratio FERNEY VOLTAIRE – Genevois français (01) PARIS-AUSTERLITZ TRAIN STATION – Paris (75) “Proxim
Slide 12: €895 m double-partnership agreement with an institutional investor in retail
A €895 m double-partnership agreement with an institutional investor in retail (of which €515 m invested upfront) “Fonds Proximité” in France Retail Fund in Europe Transactions in line with appraisal values Initial yield 25% 75% 25% Alta Commerces 75% > 5.50% Alta Proximité Europe LTV as of today: 3
Slide 13: Portfolio: major shift achieved within five years
Portfolio: major shift achieved within five years Portfolio in Group share: €2.9 bn (€2.4 bn in 2014) Last “galeries” sold or under option In €m 1 531 Steady increase in regional shopping centres and train stations A model combining 868 817 807 asset management and ownership 53% 610 36% 429 €5.2 bn
Slide 14: Strong rental income growth from deliveries and asset management
Strong rental income growth derived from deliveries and asset management +€23.7 m +14.2% Deliveries: Paris-Montparnasse and Cap3000 Like-for-like variations 190.8 Acquisitions 4,0 Acquisitions: Italian Train stations 5.5 Deliveries Like-for-like growth: +3.0% IFRS 16 13.3 impacts 167.1 3.4 (2.4) Str
Slide 15: Value creation in Retail: +€121 m in Group share
Value creation in Retail: +€121 m in Group share in 2019 Complex developments Partnership strategy and selective equity of outstanding assets allocation in Group share Capital gains on deliveries: +€88 m in Group share Like-for-like increase in portfolio value: +€33 m Paris-Montparnasse Train statio
Slide 16: The new Cap3000 waterfront shopping destination
The new Cap3000: the most striking waterfront shopping destination in Europe 135,000 m² o/w a 70,000 m² extension and capsule 5,000 m² of terraces with a sea view 280 shops & restaurants in 2020 4th A reduction of -30% 100% largest in consumption of let (extension) building primary energy employer i
Slide 17: Property development: €4.3 bn of consolidated new orders
Property development: €4.3 bn of consolidated new orders (+16%) €3.3 bn €0.8 bn €0.2 bn CENTRALE NATURE – Melun (77) EN SCENE - SCENARIO – Lyon (69) Institutional investors Strong demand in every asset classes Residential / Business property / Retail €1.8 bn new orders (+11%) CŒUR DE VILLE Retail –
Slide 18: Issy Cœur de Ville mixed-use project
Issy Cœur de Ville mixed-use project: the new standard for urban transformation Urban forest- ISSY CŒUR DE VILLE (92) Office building - ISSY CŒUR DE VILLE (92) Residential - ISSY CŒUR DE VILLE (92) Make cities sustainable Support communities Invest in the future Health & Wellness Dynamic and multi-p
Slide 19: Residential: designed to gain market shares
Residential: designed to gain market shares A multi-brand strategy Customer focus For the 3rd consecutive year Entry into the Top3 2020 (6th place in 2019) A multi-product strategy 100% focused in high- High, Mid, Entry-level range demand areas Serviced residences Historic monuments, land Grand Pari
Slide 20: Origination and new products, key drivers for 2019
Origination and new products, key drivers for 2019 successes Pipeline (land options) New offerings Major projects in the (land options, number of units) city centre Historic CAGR (average annual monuments 2 new projects signed growth rate): +18.5% 48,900 44,800 Low-carbon residential 39,000 CHAMPIGN
Slide 21: Growing sales in a declining market
Growing sales in a declining market New orders: €3.3 bn (+12%) 12,130 units (+3%) Launches €3.4 bn Properties for sale €3,278 m (+8%) €2.1 bn €2,917 m Institutional investors (+11%) Individual investors (+14%) Individual first-time Market share buyers gains in 2019 (+13%) 2018 2019 ISSY COEUR DE VIL
Slide 22: Low carbon buildings: prepare for the future
Low carbon buildings: prepare for the future Acquisition of a 50% stake in low-carbon residential leader (Cross-Laminated Timber) Founded in 2014 2,500 to 3,000 units/year annual rate The advantages of wooden buildings Ecological high-performance (carbon negative) Fast construction Reduction in wast
Slide 23: Business property: Altarea's expertise as a short...
Business property: Altarea’s expertise as a short Diversified model Multi-product offering Urban developer (Off-plan sales, Off-plan Lease, Head offices PDA and DPM) Hospitality & Logistics platforms BRIDGE: the future headquarters of ORANGE, in Issy-les-Moulineaux Investor Mastering complexity Real
Slide 24: Addressing two complementary markets
Addressing two complementary markets Grand Paris Large regional gateway cities Complex and capitalistic projects in a high value and land Emergence of an extra-urban market outside Paris region scarcity context with an increased demand in high-quality products Partnerships on the projects, services
Slide 25: CNP Assurances deals: a remarkable double transaction
CNP Assurances deals: a remarkable double transaction Acquisition of CNP’s Paris- Montparnasse head office 50/50 joint-venture Major redevelopment An iconic project of 56,200 m² A symbolic district undergoing large-scale transformation PRD MONTPARNASSE – Paris (75) PRD MONTPARNASSE – Paris (75) Off-
Slide 26: A successful year in reloading the pipeline
A successful year in reloading the pipeline New orders 15 new projects €784 m incl. VAT Potential value of (+2%) €1.3 bn CONVERGENCE (Danone) – Rueil-Malmaison (92) EM LYON BUSINESS SCHOOL – Lyon (69) Pipeline Deliveries 69 projects 6 projects HOTEL HILTON – Massy Place du Grand Ouest (91) A potenti
Slide 27: Financial Performance
03 FINANCIAL PERFORMANCE L’HOSPITALITÉ - Kremlin Bicêtre (94) RÉSULTATS ANNUELS 2019 27
Slide 28: Key figures for 2019
Key figures for 2019 Funds from 18.23 Consolidated revenue €3,110 m operations €298.8 m €/share (FFO) +7.0% (2) +29.3% +9.7%(1) LTV 33.2% EPRA NAV €2,984 m 178.7 €/share +4.8% -170 bps +9.0% (1) 2019 Change published (including IAS 23 and IFRS 16) compared with 2018 restated, i.e. +8.2% compared wit
Slide 29: Group share FFO: 2020 guidance reached one year ahead
Group share FFO: 2020 guidance reached one year ahead x2 €298.8 m FFO: €298.8 m (+9.7%) €272 m 2020 Guidance (≈ €300 m) (2) €256 m 21% reached one year early €192 m FFO per share: €18.23 (+7.0%) €161 m €146 m 47% 11% A relevant model 20% Retail: the Group’s foundations 11% Residential and Business P
Slide 30: Retail FFO reached €99.5 m
Retail FFO reached €99.5 m: a strong momentum in 2019 driven by deliveries and asset management €100.8 m €99.6 m €99.5 m €96.1 m €94.2 m 2019 FFO increase €85.1 m +€14.4 m (+17.0%) Major shift in the portfolio Delivery, disposals, partnerships Expected 2020 effects Partnerships and disposals in 2019
Slide 31: Property development FFO reaches €208.7 m
Property development FFO reaches €208.7 m: a +9.6% growth mainly driven by Residential Property development FFO (Residential and Business property) €208.7 m €190.3 m 65.4 Residential 1st contributor of Group FFO Market share gains (volume effect) €132.8 m Ramping up €95.3 m Business Property €70.5 m
Slide 32: EPRA NAV: €178.7 per share (+4.8%)
EPRA NAV: €178.7 per share (+4.8%) In € per share +4.8% Capital gains Retail (1.8) 178.7 Capital gains 7.3 Others Property Property development FFO 170.5 2.0 Unchanged appraisal values (4.1) Capital gains on Business Property Opening assets (€2.0/share) impacts 18.2 (incl. IFRS) (13.5) Significant v
Slide 33: Net debt stable at €2,475 m
Net debt stable at €2,475 m (+€26 m) despite a strong growth context In €m Residential Business Retail Property Net Italian Train stations, dividend Capex (Montparnasse, Cap3000) Retail Others Business Property Retail Sales & Partnerships CNP Montparnasse & Issy Residential FFO Acquisitions of Woode
Slide 34: Altarea enhanced its credit profile
Altarea enhanced its credit profile while preserving a significant investment capacity Credit ratings confirmed Robust financial ratios Change in financing sources by S&P Global LTV: 33.2% (-170 bps) Increased usage of credit markets products BBB / stable ICR: 7.3 x Repayment of mortgages Net debt/E
Slide 35: 2019 dividend per share
2019 dividend Tax considerations €13.00 €12.21: Share-premium refund €0.79: Distribution from "SIIC" income per share (1) Script dividend option +2.0% Either 100% in cash or 50% share/50% cash (2) (1) Subject to shareholder approval at the General Shareholders' Meeting on 19 May 2020. (2) Based on a
Slide 36: Outlook
04 OUTLOOK PARIS-AUSTERLITZ TRAIN STATION – Paris (75) 2019 ANNUAL RESULTS 36
Slide 37: Transforming cities: a vast and growing market
Transforming cities: a vast and growing market, a complex issue Urbanisation will City centres will intensify continue to reinvent themselves In the territories where it is already at work and in the Large mixed-use projects new "extra-urban market" Densification, Reconversion territories Environmen
Slide 38: Altarea, unique set of skills for urban transformation
Altarea, unique set of skills for urban transformation Residential will be key Cities will always in the cohesion of need brick and mortar communities retail shops Affordable residential, for all social classes, Proximity, Flows, Urban for all ages logistics, Leisure Institutional investors will hea
Slide 39: Prepare for the future
Prepare for the future Pursuit of growth strategy in our markets Entrepreneurship Financial DNA capacity 18,000 to 20,000 Assets under 100 to 150,000 m² units per year management > ~€6-7 bn of yearly Steady value of portfolio in supply Group share New markets and broadening of the Group’s skills pla
Slide 40: Perspectives: mid and long term guidance
Perspectives: mid and long term guidance The Group is confident in keeping the path of a steady FFO growth in the mid and long term The Group aims at maintaining its “GRESB 5 Star” rating Dividend policy will remain in line with previous years Altarea has demonstrated in the recent past its ability
Slide 41: Glossary and Appendices
05 GLOSSARY AND APPENDICES BRIDGE – Issy-les-Moulineaux (92) RÉSULTATS ANNUELS 2019 41
Slide 42: Glossary (1/2)
Glossary (1/2) • Appraisal value – Retail: Value of portfolio assets including transfer duties (at 100% or • Financial vacancy: Estimated rental value (ERV) of vacant units as a percentage of Group Share). total estimated rental value. France and International. • Average total cost of the debt: Aver
Slide 43: Glossary (2/2)
Glossary (2/2) • Net rental income: The Group now reports net rents charged including the contribution • "Supported" jobs: Source: The Study "Empreinte Emplois Altarea Cogedim" to the marketing fund, the rebilling of work and investments as lessor. (Altarea Cogedim Job Footprint) by Utopies 2019. •
Slide 44: IFRS 16 and IAS 23 standards
IFRS 16 and IAS 23 standards IFRS 16 – Leases IAS 23 – Borrowing Costs IFRS 16 ends the distinction between finance and operating leases. This The clarification of IAS 23 leads to directly entering interest expenses on standard is applicable as from 1 January 2019. development projects (previously i
Slide 45: 2019 Income statement
2019 Income statement Changes in value, Funds from operations In € m Retail Residential Business Property Other (Corporate) estimated expenses and TOTAL (FFO) transaction costs Revenue 227.5 2 294.4 587.9 0.1 3,109.8 - 3 109.8 Change vs. 31/12/2018 published +7.4% +24.1% +70.3% n.a. +29.3% +29.3% Ne
Slide 46: Net asset value (NAV)
Net asset value (NAV) EPRA NAV - GROUP 31/12/2019 31/12/2018 Published In €m Change €/share Change In €m €/share Consolidated equity, Group share 2,144.4 128.4 2,007.9 125.0 Other unrealised capital gains 701.5 641.1 Restatement of financial instruments 97.5 64.4 Deferred tax on the balance sheet fo
Slide 47: Detailed balance sheet (1/2)
Detailed balance sheet (1/2) In € m 31/12/2019 31/12/2018 restated NON-CURRENT ASSETS 5,455.4 5,289.0 Intangible assets 331.4 313.7 o/w Goodwill 209.4 194.3 o/w Brands 105.4 100.7 o/w Client relations 0.6 - o/w Other intangible assets 16.1 18.8 Property plant and equipment 20.9 20.6 Right-of-use ass
Slide 48: Detailed balance sheet (2/2)
Detailed balance sheet (2/2) In € m 31/12/2019 31/12/2018 restated EQUITY 3,335.5 3,229.4 Equity attributable to Altarea SCA shareholders 2,144.4 2,000.1 Capital 255.2 245.4 Other paid-in capital 311.8 407.9 Reserves 1,343.8 1,094.6 Income associated with Altarea SCA shareholders 233.7 252.3 Equity