DJ PATRIMOINE ET COMMERCE: 2023 HALF-YEAR RESULTS
PATRIMOINE ET COMMERCE
PATRIMOINE ET COMMERCE: 2023 HALF-YEAR RESULTS
26-Jul-2023 / 08:00 CET/CEST
Dissemination of a French Regulatory News, transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.
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PRESS RELEASE
2023 HALF-YEAR RESULTS
Paris, July 26, 2023
At its meeting on July 25, 2023, the Patrimoine & Commerce Supervisory Board reviewed the Company's operations and
approved the 2023 half-year financial statements, prepared by Management.
-- Gross rental income growing by +7.3%
-- Funds from operations growing by +5.4%
-- Portfolio valuation of EUR 855m
-- LTV ratio decreasing to 42.9%
Key figures:
Key financials 30/06/2023 30/06/2022 Var. %
6 months 6 months
Gross Rental Income EUR 24.7m EUR 23.0m +7.3%
Funds from operations (1) EUR 14.8m EUR 14.1m +5.4%
Group share of net profit EUR 12.8m EUR 28.4m (54.9%)
Alternative Performance Measures 30/06/2023 31/12/2022 Var. %
Asset appraisal value (excluding transfer taxes) (2) EUR 854.9m EUR 841.3m +1.6%
Capitalization rate (3) 7.1% 7.0% n.a
LTV ratio (4) 42.9% 44.0% n.a
NAV (excluding transfer taxes - EUR/share) EUR 28.0 EUR 28.5 (1.6%)
NAV (excluding transfer taxes) EUR 423.1m EUR 431.2m (1.9%)
Eric Duval, Managing Director and Founder of Patrimoine & Commerce declared: « Patrimoine & Commerce achieved strong results over the first six months of 2023, with the company benefiting from limited exposure to interest rates increase while taking advantage of the positive effects of rent indexation. Our robust financial structure allows us to have confidence in the ability of Patrimoine & Commerce to consolidate its position as the leader of low-cost retail park market players in France and to ensure sustainable growth for our shareholders. »
Operational performance
In an uncertain context, marked by inflation and rising interest rates, Patrimoine & Commerce continues to demonstrate the attractiveness of the retail park model, through moderate rents, and low-cost stores sought after by consumers to fight against the decline in purchasing power.
Over the first half of 2023, Patrimoine & Commerce had a sustained leasing activity and signed 16 leases (of which 10 renewals). The financial occupancy rate is stable at 94.3% (5). The collection rate on rents, service charges and taxes stands at 98% on the first quarter of 2023 and 95% on the second quarter.
Financial performance
Over the first half of 2023, Patrimoine & Commerce continued to deliver a solid financial performance.
As of June 30, 2023, Patrimoine & Commerce reported gross rents of EUR 24.7m, against EUR 23.0m as of June 30, 2022:
in millions of euros - 6 months 30/06/2023 30/06/2022 Var. % Like-for-like 22.0 20.9 +5.2% Acquisitions 2.0 1.0 n.a Disposals - 1.0 n.a Delivery of restructuring works 0.7 0.0 n.a Gross rental income 24.7 23.0 +7.3%
The increase of gross rental income is driven by acquisitions (+EUR 0.9m) and disposals (-EUR 1.0m), as well as by the delivery of restructuring works of La Martinique and Ville-du-Bois (+EUR 0.7m). The like-for-like increase of gross rental income (+EUR 1.1m, +5.2%) derives from contractual indexation, and the decrease in the amortization of Covid-19 rent free periods.
Net rental income is increasing by +6.9% between 2022 and 2023, with the gross to net ratio in line between the two fiscal years (91% of gross rental income in 2023 vs. 92% in 2022), mainly composed of unrecovered rental expenses and provisions for credit losses (which represent approximately 1.3% of half-year invoicing):
in millions of euros - 6 months 30/06/2023 30/06/2022 Var. % Gross rental income 24.7 23.0 +7.3% Entry fees 0.0 0.0 n.a. Gross rental revenue 24.7 23.0 +7.3% Unrecovered rental expenses (1.7) (1.5) +12.6% Other building expenses (0.4) (0.4) n.a. Net rental income 22.6 21.1 +6.9%
Operating expenses and other revenues remained under control at EUR 2.7m. Current operational result reached EUR 19.8m as of June 30, 2023.
Net cost of debt amounted to EUR 5.4m as of June 30, 2023, increasing by +21.4% compared to June 30, 2022. The Company has a low exposure to interest rate risk with 78% of fixed or variable rate debt hedged, which limited the increase in the average interest rate over the period (2.63% for the first half of 2023 vs. 1.97% for the first half of 2022), in a context of a sharp rise in the 3-month Euribor rate.
Recurring net result (FFO) amounted to EUR 14.8m as of June 30, 2023, against EUR 14.1m as of June 30, 2022, increasing by +5.4%:
in millions of euros - 6 months 30/06/2023 30/06/2022 Var. % Restated current operational result 20.3 18.8 +8.0% Restated net cost of debt (5.4) (4.4) +21.4% Current taxes (0.1) (0.3) n.a. Funds from operations (FFO) (1) 14.8 14.1 +5.4% Diluted FFO per share 0.98 0.94 +4.6%
The external appraisal valuation campaign resulted in a fair value adjustment of -EUR 0.8m in the 2023 half-year accounts, reflecting an appreciation of the capitalization rate of commercial galleries, partly offset by the high level of rent indexation.
Including the share of the result of companies accounted for using the equity method (-EUR 1.4m), the fair value adjustment on financial instruments (-EUR 0.3m) and other non-recurring revenues and charges (-EUR 0.2m), the net profit amounted to EUR 12.1m as of June 30, 2023 and EUR 12.8m in group share.
Decrease of the LTV ratio, decrease of the NAV per share at EUR 28.0 (-1.6%)
The Group consolidated net debt of EUR 358.0m as of June 30, 2023, implies a Loan-to-Value ratio of 42.9%, leaving a significant investment capacity compared to the target of 50% set by Patrimoine & Commerce.
in millions of euros 30/06/2023 31/12/2022 Net Debt 358.0 360.9 (-) other lease liabilities (0.6) (0.6) (-) financial instruments 1.9 2.2 Net debt excl. Financial instruments 359.3 362.4 Property valuation (excl. Transfer taxes) 838.3 823.9 Loan To Value 42.9% 44.0%
Net asset value per share amounted to EUR 28.0 (EUR 423.1m) as of June 30, 2023, a decrease of -1.6% versus 2022. Restated from the distribution of the dividend relative to 2022 fiscal year, the net asset value would stand at EUR 443.4m (29.4 EUR/share), an increase of +3.1% compared to December 31, 2022.
in millions of euros 30/06/2023 31/12/2022 NAV, excl. Transfer taxes 423.1 431.2 NAV per share, excl. Transfer taxes (in euros) 28.01 28.48 Number of shares (excl. Treasury shares) 15 105 520 15 144 241
Development and optimization of the portfolio
As of June 30, 2023, the portfolio valuation (excluding transfer taxes and including properties accounted for using the equity method), reached EUR 854.9m, increasing by +1.6% compared to December 31, 2022. The capitalization rate of the properties in operation stands at 7.1% (vs. 7.0% as of December 31, 2022).
in millions of euros Variation Net balance as of January 1st, 2023 841.3 Acquisitions and investments 17.9 Disposals (2.6) Fair value impact (1.7) Net balance as of June 30, 2023 854.9
Over the first six months of 2023, Patrimoine & Commerce continued its development through the acquisition of a retail property in Saint-Parres-aux-Tertres (Grand Est), for a global amount of EUR 9.7m. Other investments were made on the existing portfolio, for a global amount of EUR 8.2m, mainly composed of the restructuring works in La Ville-du-Bois, the construction of a new building in Wittenheim, and the delivery of two retail units in Lexy.
Patrimoine & Commerce also completed the disposal of a retail asset in Vandoeuvre (Grand Est), a commercial unit in Salon-de-Provence (Provence-Alpes-Côte d'Azur) and a land in Lempdes (Auvergne-Rhône-Alpes) for a total consideration of EUR 2.6m, in line with external appraisers' valuations.
ESG Commitment
Regardful ESG issues, with the willingness to go beyond the regulatory constraints of the Décret Tertiaire, Patrimoine & Commerce has committed to the implementation of its 2021-2025 roadmap on the themes of environment, governance and social issues.
This approach materialized over this semester with a partnership signed with the Atlante group in April 2023, with a project to deploy 100 fast charging stations at 18 Patrimoine & Commerce sites, which will be installed by mid-2024. A study is underway to extend these charging stations to other sites.
Approval of the EUR 1.30 dividend per share
The Annual General Meeting held on June 8, 2023 approved the distribution of a dividend of EUR 1.30 per share, for a global amount of EUR 20.2m. This dividend implies a yield on NAV (before dividend distribution) of 4.4%, and a yield on share price of 7.0% (as of July 21st, 2023).
Agenda
October 11, 2023 Third-Quarter 2023 activity
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About Patrimoine & Commerce
Patrimoine & Commerce owns and operates a real estate portfolio, largely comprising retail property, covering a total surface area of more than 528,000 sqm. The assets are mainly located in retail parks near mid-sized towns throughout France. Patrimoine & Commerce benefits from a significant identified deal flow that will enable it to feed its growth, in terms of both assets under development and operating assets.
Notes: 1 The current operational result and the net cost of debt are restated from operating expenses, other income and financial expenses of the real estate development activity (-EUR 0,4m in 2023 as well as in 2022)
2 Incl. Group share of Cherbourg and Studio Prod and assets held for sale.
3 Based on annualized rents (or market rental value for vacant spaces) and on property valuation excl. transfer taxes
4 Adjusted for hedging instruments
5 Excluding strategic vacancy
Patrimoine & Commerce is listed on NYSE Euronext Paris.
ISIN code: FR0011027135 - Mnémo code: PAT
For further information, go to: www.patrimoine-commerce.com
For information, please contact:
PATRIMOINE & COMMERCE KEIMA Communication
Eric DUVAL
Emmanuel DOVERGNE
Managing Director
+33 (0)1 56 43 44 63
+33 (0)1 46 99 47 79
emmanuel.dovergne@keima.fr
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Regulatory filing PDF file File: 2023 HALF-YEAR RESULTS
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Language: English
Company: PATRIMOINE ET COMMERCE
45 avenue Georges Mandel
75016 PARIS
France
Phone: +33146994762
E-mail: contact@patrimoine-commerce.com
Internet: https://www.patrimoine-commerce.com/
ISIN: FR0011027135
Euronext Ticker: PAT
AMF Category: Inside information / News release on accounts, results
EQS News ID: 1688019
End of Announcement EQS News Service
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1688019 26-Jul-2023 CET/CEST
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