TIDMNEPI
RNS Number : 4404O
New Europe Property Investments PLC
09 February 2016
NEW EUROPE PROPERTY INVESTMENTS PLC
(Incorporated and registered in the Isle of Man with registered
number 001211V)
(Registered as an external company with limited liability under
the laws of South Africa, Registration number 2009/000025/10)
AIM share code: NEPI JSE share code: NEP BVB share code: NEP
ISIN: IM00B23XCH02
("NEPI" or "the Company")
Directors' Commentary
DISTRIBUTABLE EARNINGS
The Group achieved 34.76 euro cents in recurring distributable
earnings per share for 2015, which combined with the 0.58 euro
cents per share non-recurring distributable earnings (which were
the result of a financial discount derived from the early repayment
of a term loan) represents a 19% improvement in distributable
earnings per share compared to 2014. The growth in distributable
earnings for 2015 is due to the continuing strong performance of
NEPI's assets, the positive impact of acquisitions and developments
completed during the year, and the favourable funding arrangement
with the minority shareholder of Mega Mall.
FINAL DISTRIBUTION AND OPTION TO RECEIVE CAPITAL RETURN
The Board declares a distribution of 17.17 euro cents per share
for the six months ended 31 December 2015, which combined with the
distributable earnings for the first half of the financial year,
results in a 35.34 euro cents per share distribution for 2015.
Shareholders can elect to receive their distribution in cash or by
way of an issue of fully paid shares at a ratio between the
distribution declared and the reference price. The reference price
will be determined using an up to 5% discount to the 5 - day volume
weighted average traded price (less distribution) of NEPI shares on
the JSE, no later than 1 March 2016.
A circular containing full details of the election being offered
to shareholders, accompanied by announcements on the Stock Exchange
News Service (SENS) of the Johannesburg Stock Exchange (JSE), the
Regulatory News Service (RNS) of the London Stock Exchange (LSE)
and the Bucharest Stock Exchange (BVB), will be issued in due
course.
HIGHLIGHTS
INVESTMENT GRADE RATINGS AND BOND ISSUE
In October 2015, Standard & Poor's Ratings Services
(S&P) assigned NEPI a first-time BBB- preliminary, long-term
corporate credit rating. Moody's Investors Service (Moody's) has
upgraded the Company's rating to Baa3, replacing NEPI's 2014
assigned Ba1 rating. Both ratings have a stable outlook.
Subsequent to a roadshow with European fixed-income investors in
November 2015, NEPI issued EUR400 million of unsecured, 5.25 year
Eurobonds maturing on 26 February 2021, carrying a 3.750% fixed
coupon and with an issue price of 99.597%. This represents a
milestone for NEPI, as it is the first time the Company has raised
material amounts from European investors, enabling it to compete
more effectively in the Central and Eastern European real estate
markets in the long term. Of the proceeds, approximately EUR212
million refinanced existing debt, while the balance is earmarked
for acquisitions and developments.
ACQUISITIONS AND DEVELOPMENTS
The Group completed the acquisition and development of a number
of properties during 2015 which are discussed in more detail below.
The effective, or opening, date of acquisitions and developments is
indicated in parenthesis after the name. All populations are
estimates, and all developments and acquisitions are located in
Romania unless otherwise specified.
RETAIL PROPERTY ACQUISITIONS, COMPLETED DEVELOPMENTS AND
EXTENSIONS
Mega Mall (14 May 2015)
The Group's largest development to date, the 75,500m(2) Gross
Leasable Area (GLA) Mega Mall, commenced trading in the first half
of 2015, and is currently 98.2% occupied. Since opening, the centre
has dominated retail in heavily populated eastern Bucharest, with a
catchment area of 910,000 within a 30-minute drive. Peek &
Cloppenburg opened its largest store in Romania in Mega Mall during
October 2015.
Iris Titan Shopping Center (1 July 2015)
NEPI acquired Iris Titan Shopping Center, a 44,700m(2) GLA
shopping mall, located in Titan, Bucharest's most densely populated
district. There are 599,000 residents within a 15-minute drive. The
property is anchored by Romania's first, and largest, Auchan
hypermarket, and contains numerous international brands, such as
Adidas, C&A, CCC, Deichmann, dm, Flanco, H&M, New Yorker
and Takko, as well as a seven-screen cinema.
City Park extension - first phase (31 July 2015)
The Group opened the first phase of the mall's extension, a
ten-screen Cinema City, featuring Romania's second 4DX auditorium
(the first is in NEPI's Mega Mall). The centre is located in
Constanta, which has a population of 284,000. There are 541,000
residents within a 45-minute drive.
Shopping City Deva extension (24 September 2015)
The 10,100m(2) GLA extension to Shopping City Deva attracts the
city's 57,000 inhabitants. There are 277,000 residents within a
45-minute drive. The extension includes new tenants such as Altex,
C&A, CCC, a six-screen Cinema City, Deichmann, H&M, Hervis,
KFC, New Yorker, Orsay and an entertainment area. The total GLA
after the extension is 52,300m(2) , and these additional brands and
facilities strengthen the centre's regionally dominant
position.
Severin Shopping Center extension - first phase (15 October
2015)
The first phase of Severin Shopping Center's extension, located
in Drobeta Turnu Severin, comprises 4,400m(2) GLA. The city has
86,000 inhabitants and 175,000 residents live within a 45-minute
drive from the shopping centre. New tenants include Benvenuti, a
six-screen Cinema City, KFC, as well as leisure and entertainment
facilities.
Shopping City Timisoara - hypermarket and gallery (26 November
2015)
NEPI is progressing with the development of the 56,800m(2) GLA
first phase of a regional mall of up to 80,000m(2) GLA, in a
densely populated district of Timisoara. The city, with 319,000
inhabitants, is the third largest in Romania, while 570,000
residents are within a 45-minute drive. The first section,
comprising 16,300m(2) GLA, includes tenants such as Carrefour,
Media Galaxy, Noriel, Pepco and Zoomania. The adjacent
do-it-yourself store, owned by Dedeman, opened on 23 October
2015.
OFFICE PROPERTY ACQUISITIONS, COMPLETED DEVELOPMENTS AND
EXTENSIONS
The Office, Cluj-Napoca - second phase (27 November 2015)
The second phase of The Office, Cluj-Napoca, comprising
19,400m(2) of A-grade office GLA has been completed, and was ready
for tenant fit out in November 2015. As at 8 February 2016, 82% of
Phase II has been let.
City Business Centre, Timisoara - buildings D&E (30 November
2015)
NEPI has completed the acquisition of City Business Centre by
adding the newest two buildings in the complex to its portfolio.
The total GLA is now 47,100m(2) and the property, which includes
five separate buildings with a common parking, is the largest
A-grade office in Timisoara.
DEVELOPMENT PIPELINE
The Group has steadily increased its investment in developments
and, during the last five years, completed developments and
redevelopments have significantly contributed to the growth in
distributable earnings per share. NEPI's development pipeline,
including redevelopments and extensions, has increased to EUR601
million (estimated at cost), of which EUR145 million had been spent
by 31 December 2015. This represents an increase of
EUR54 million compared with the previous year.
RETAIL PROPERTY DEVELOPMENTS AND EXTENSIONS
City Park extension - second phase
Work on the second phase of City Park's extension, including
tenants such as C&A, Colin's, H&M, Motivi, New Yorker,
Orsay, Sephora, World Class and Zara Home, is on-going and
completion is expected during the second quarter of 2016. Once
completed, the centre's total GLA will be 49,800m(2) .
Promenada Mall extension
The Group is in the process of obtaining new zoning and
construction permits for a retail extension and integrated office
building to its Promenada Mall, situated in Bucharest's new central
business district. The extension will add approximately 34,000m(2)
of retail GLA to the existing 40,400m(2) , while the integrated
office will consist of up to 30,000m(2) GLA (depending on
permitting). The retail extension will include new fashion tenants,
a cinema and additional leisure and entertainment facilities, as
well as 1,900 new parking spaces that will benefit residents and
employees. Subject to permitting, NEPI estimates that the extension
will be completed in 2018.
Severin Shopping Center extension - second phase
The Group will extend Severin Shopping Center with an additional
1,500m(2) fashion GLA during 2016, increasing total GLA to
22,400m(2) .
Shopping City Timisoara - fashion and entertainment section
The Carrefour hypermarket and gallery opened in the last quarter
of 2015, while the fashion and entertainment section is scheduled
to be completed in the first quarter of 2016. The tenants will
include Bershka, C&A, CCC, Cropp, Deichmann, dm, Douglas,
H&M, Hervis, KFC, Koton,
LC Waikiki, New Yorker, Orsay, Otter, Pimkie, Pizza Hut,
Pull&Bear, Sephora, Sport Vision, Stradivarius, Tom Tailor and
Zara. The centre will have substantial modern entertainment and
leisure facilities, including a gym and a thirteen-screen cinema
(the largest cinema outside of Bucharest), with an IMAX and a 4DX
auditorium.
Shopping City Piatra Neamt
The Group is developing a 27,900m(2) GLA regional mall in Piatra
Neamt. The city has 86,000 inhabitants with 245,000 residents
within a 45-minute drive. Carrefour has been secured as a tenant
for a 10,000m(2) GLA hypermarket together with a six-screen cinema
operated by Cinema City.
Other secured tenants include C&A, CCC, Orsay and Pepco. The
shopping centre is scheduled to open in the fourth quarter of
2016.
OFFICE DEVELOPMENTS
The Office, Cluj-Napoca - third phase
(MORE TO FOLLOW) Dow Jones Newswires
February 09, 2016 02:00 ET (07:00 GMT)
Based on the strong demand for quality office space, NEPI will
soon commence work on the third phase of The Office, Cluj-Napoca,
consisting of 18,500m(2) GLA. The Group estimates that it will be
completed during 2017.
Victoriei Office
This development, located in Victoriei Square, adjacent to the
Romanian Government building, includes the development of a modern
office and the refurbishment of a historical building. This
8,400m(2) GLA landmark office is scheduled for completion in the
third quarter of 2016.
OTHER HIGHLIGHTS
Non-recoverable tenant income for 2015 amounted to EUR398
thousand, equivalent to 0.26% of annual contractual rental income
and expense recoveries. The vacancy level as at 31 December 2015
was 2.9%, without accounting for properties held for sale. The
increase in vacancy was compared to the 1.8% reported at the end of
2014 is mostly attributable to the recently completed office
development and recent acquisitions.
The Company is actively pursuing investment opportunities in
other CEE countries where it currently has no presence and expects
to enter new markets in 2016. Although increased competition
(arising partly from high liquidity) can be seen across the
markets, and yield compression occurred during the past period,
NEPI remains well positioned for further expansion, given its
established property platform.
CHANGES TO THE BOARD OF DIRECTORS
As announced on 30 December, 2015, Mr Dewald Joubert has
resigned as Non-executive Director. The Board of Directors
appointed Mr Robert Reinhardt Emslie as non-executive Director,
effective from 4 February, 2016. Mr Emslie is a Chartered
Accountant, with significant experience in banking services and
property management, and currently holds chairmanship and
non-executive directorship positions in various private and listed
companies.
CASH MANAGEMENT AND DEBT
Throughout the financial year the Company raised EUR179 million
by issuing new ordinary shares.
Following the successful EUR400 million unsecured bond issue
completed in November 2015, the Company repaid the EUR143.8 million
unsecured, syndicated term loan (contracted earlier in 2015 as a
bridge to the bond financing) and EUR68 million of secured debt.
The Group improved the funding terms on its most attractive debt
facilities, including Aupark Kosice, Aupark Zilina and Floreasca
Business Park.
As at 31 December 2015, the Group had EUR330 million in cash and
an additional undrawn revolving facility of EUR80 million. NEPI's
gearing ratio (interest bearing debt less cash divided by
investment property and listed property shares) reached 14.6%,
compared to 8% at the end of the previous year, and is expected to
increase further, once available cash is spent to finance the
acquisitions and development pipeline. Capital commitments for
developments and acquisitions in due diligence or at an advanced
stage of negotiations exceed EUR300 million.
The average interest rate, including hedging costs, was 3.9%
during 2015, down from 5% in 2014, due to contracting new debt at
lower rates and decreasing the interest margin on the existing
debt. As at 31 December 2015, the Group was fully hedged against
interest rate movements, with 41% of the base interest rate
(Euribor) being hedged with interest rate caps and 59% with
interest rate swaps.
PROSPECTS AND EARNINGS GUIDANCE
Recurring distributable earnings per share for the year 2016 are
projected to be approximately 15% higher compared to 2015.
Recurring distributable earnings for the first half of 2016 are
expected to be approximately 5% higher compared to the respective
period of 2015 due to changes in funding arrangements and timing of
completion of developments and acquisitions planned for the first
part of 2016. The earnings guidance is based on the assumption that
a stable macroeconomic environment prevails, no major corporate
failures occur, planned developments remain on schedule, and is
sensitive to the impact of the acquisitions currently in the
pipeline. This forecast has not been audited or reviewed by NEPI's
auditors and is the responsibility of the Board.
By order of the Board of Directors,
Alexandru Morar Mirela Covasa
Chief Executive Officer Finance Director
9 February 2016
Management Accounts
All amounts in EUR '000 unless otherwise stated
CONSOLIDATED STATEMENT OF INCOME 31 Dec 31 Dec
2015 2014
-------------------------------------------- -------- --------
Gross rental income 110 937 67 459
-------- --------
Net service charge and operating expenses (2 526) (1 733)
-------- --------
Service charge and other recoveries 44 074 25 619
-------- --------
Property operating expenses (46 600) (27 352)
-------- --------
Net operating income 108 411 65 726
Corporate expenses (9 618) (4 538)
-------- --------
Property management net result 2 902 1 498
--------------------------------------------- -------- --------
EBITDA 101 695 62 686
Net finance expense (5 759) (1 677)
-------- --------
Finance expenses (17 829) (15 676)
Finance income 3 822 6 374
Interest capitalised on development 8 248 7 625
-------- --------
Non-controlling interest (7 427) 4 920
-------- --------
Direct investment result 88 509 65 929
--------------------------------------------- -------- --------
Indirect investment result 69 889 33 266
--------------------------------------------- -------- --------
Profit for the period attributable to
equity holders 158 398 99 195
-------- --------
Reverse indirect result (69 889) (33 266)
Company specific adjustments 12 096 2 273
-------- --------
Distributable earnings before issue cum
distribution 100 605 68 202
--------------------------------------------- -------- --------
Issue cum distribution adjustment 1 954 6 870
Distributable earnings 102 559 75 072
--------------------------------------------- -------- --------
Distributable earnings per share (euro
cents) 35.34 29.69
of which recurring distributable earnings
per share (euro cents) 34.76 29.69
Distribution per share (euro cents) 35.34 32.22
--------------------------------------------- -------- --------
CONSOLIDATED STATEMENT OF FINANCIAL POSITION 31 Dec 31 Dec
2015 2014
--------------------------------------------- ------- -------
ASSETS
------- -------
1 858 1 389
Non-current assets 740 772
------- -------
1 814 1 334
Investment property 357 512
------- -------
1 655 1 038
Investment property at fair value 219 545
213
Developments at cost 159 138 894
------- -------
Advances paid for investment property - 82 073
------- -------
Goodwill 23 986 17 639
Other long-term assets 18 115 37 446
Financial assets at fair value through
profit or loss 2 282 175
Current assets 410 095 180 526
------- -------
Investment property held for sale 25 255 27 360
---------------------------------------------- ------- -------
Trade and other receivables 55 229 41 199
111
Cash and cash equivalents 329 611 967
------- -------
2 268 1 570
Total assets 835 298
---------------------------------------------- ------- -------
LIABILITIES 772 285 329 009
------- -------
Bank borrowings 201 095 218 399
Bonds 393 414 -
Deferred tax liabilities 93 571 55 907
Other long-term liabilities 15 443 9 446
Financial liabilities at fair value through
profit or loss 3 417 5 104
------- -------
(MORE TO FOLLOW) Dow Jones Newswires
February 09, 2016 02:00 ET (07:00 GMT)
Trade and other payables 65 345 40 153
------- -------
1 496 1 241
Equity attributable to equity holders 550 289
---------------------------------------------- ------- -------
Total liabilities and equity attributable 2 268 1 570
to equity holders 835 298
---------------------------------------------- ------- -------
Adjusted Net Asset Value per share (euro) 5.25 4.63
---------------------------------------------- ------- -------
RECONCILIATION OF PROFIT FOR THE PERIOD 31 Dec 31 Dec
TO DISTRIBUTABLE EARNINGS 2015 2014
------------------------------------------------- -------- --------
Profit for the period attributable to equity
holders 158 398 99 195
-------- --------
Unrealised foreign exchange loss 348 350
-------- --------
Acquisition fees 933 2 357
-------- --------
Share-based payment expense 670 675
-------- --------
Accrued interest on share-based payments 89 542
-------- --------
(35
Fair value adjustments of investment property (89 946) 227)
-------- --------
Fair value gains of financial investments
at fair value through profit or loss - (1 299)
-------- --------
Fair value adjustment of financial assets
and liabilities (1 398) 2 882
-------- --------
Amortisation of financial assets (3 554) (708)
-------- --------
Dividends received from financial investments - (2 417)
-------- --------
Accrued dividend for financial investments - 2 304
-------- --------
Gain on disposal of investment property - (619)
-------- --------
Gain on acquisition of subsidiaries - (1 400)
-------- --------
Deferred tax expense 19 508 1 567
-------- --------
Shares issued cum distribution 1 954 6 870
-------------------------------------------------- -------- --------
Adjustments related to non controlling
interest
------------------------------------------------- -------- --------
Fair value adjustment of Investment property 18 598 -
-------------------------------------------------- -------- --------
Deferred tax expense (3 041) -
-------------------------------------------------- -------- --------
Distributable earnings for the period 102 559 75 072
-------------------------------------------------- -------- --------
Distribution from reserves - 6 659
(102 (81
Less: distribution declared 559) 731)
-------- --------
(33
Interim distribution (51 304) 475)
-------- --------
(48
Final distribution (51 255) 256)
-------------------------------------------------- -------- --------
Earnings not distributed - -
298 590 278 138
Number of shares entitled to distribution 564 240
-------------------------------------------------- -------- --------
Distributable earnings per share for the
period (euro cents) 35.34 29.69
-------- --------
Distribution from reserves per share (euro
cents) - 2.53
Less: Distribution declared per share (euro
cents) (35.34) (32.22)
-------- --------
Interim distribution per share (euro cents) (18.17) (14.87)
-------- --------
Final distribution per share (euro cents) (17.17) (17.35)
-------------------------------------------------- -------- --------
Earnings not distributed (euro cents) - -
-------------------------------------------------- -------- --------
LEASE EXPIRY 2016 2017 2018 2019 2020 2021 2022 2023 2024 >=2025 Total
PROFILE
--------------- ---- ---- ----- ----- ----- ----- ---- ---- ---- ------ -----
Total based on
rental income 3.9% 9.7% 13.0% 14.1% 17.1% 13.8% 4.4% 2.8% 4.4% 16.8% 100%
--------------- ---- ---- ----- ----- ----- ----- ---- ---- ---- ------ -----
Total based on
rented area 1.7% 6.8% 12.8% 12.7% 14.1% 12.8% 5.3% 5.4% 5.7% 22.7% 100%
--------------- ---- ---- ----- ----- ----- ----- ---- ---- ---- ------ -----
BASIS OF PREPARATION - MANAGEMENT ACCOUNTS
The management accounts presented constitute pro forma financial
information in terms of the JSE Limited Listing Requirements.
As the Group is focusing on being consistent on those areas of
reporting that are seen to be of most relevance to investors and on
providing a meaningful basis of comparison for users of the
financial information, it has prepared unaudited management
accounts. The main difference between the management accounts and
the condensed consolidated financial results prepared in accordance
with IFRS is that the management accounts are prepared using the
proportionate consolidation method for investments in joint
ventures, which is not in accordance with IFRS (consistent with
financial statements prepared in accordance with IFRS reported
before 1 January 2013), while the IFRS statements use the equity
method for accounting for these investments (following the adoption
of IFRS 11 'Joint Arrangements' effective 1 January 2013).
The management accounts have been prepared by and are the
responsibility of the Directors of NEPI. Due to their nature, the
management accounts may not fairly reflect the financial position
and results of the Group after the differences set out above. The
directors are not aware of any matters or circumstances arising
subsequent to 31 December 2015 that require any additional
disclosure or adjustment to the reviewed condensed consolidated
financial results.
In relation to management accounts included in this preliminary
report, a reporting accountant's report is required by JSE Limited
and will be available for inspection at the Company's registered
office. Furthermore, any reference to future financial performance
included in this preliminary report has not been reviewed or
reported on by the group's external auditors. The auditor's review
report does not necessarily report on all of the information
contained in this announcement/financial results. Shareholders are
therefore advised that in order to obtain a full understanding of
the nature of the auditor's engagement they should obtain a copy of
the auditor's review report together with the accompanying
financial information from the Company's registered office. The
directors take full responsibility for the preparation of the
preliminary report.
IFRS Accounts
All amounts in EUR '000 unless otherwise stated
CONSOLIDATED STATEMENT OF COMPREHENSIVE Reviewed Audited
INCOME 31 Dec 31 Dec
2015 2014
----------------------------------------------- -------- --------
Net rental and related income 104 067 61 749
-------- --------
Contractual rental income and expense
recoveries 148 799 87 017
-------- --------
(25
Property operating expenses (44 732) 268)
-------- --------
Administrative expenses (6 695) (2 839)
EBITDA 97 372 58 910
Acquisition fees (933) (2 357)
-------- --------
Fair value adjustments of investment property 81 742 27 980
-------- --------
Fair value gains on financial investments
at fair value through profit or loss - 1 299
Dividends received from financial investments - 2 417
(MORE TO FOLLOW) Dow Jones Newswires
February 09, 2016 02:00 ET (07:00 GMT)
Share-based payment expense (670) (675)
Foreign exchange loss (339) (241)
Gain on acquisition of subsidiaries - 1 400
Gain on disposal of investment property - 619
------------------------------------------------ -------- --------
Profit before net finance income/(expense) 177 172 89 352
Net finance income/(expense) (916) 3 278
-------- --------
Finance income 7 613 7 315
------------------------------------------------ -------- --------
Finance expense (8 529) (4 037)
------------------------------------------------ -------- --------
Changes in fair value of financial instruments 1 149 (1 866)
Share of profit of joint ventures 2 399 4 148
Profit before tax 179 804 94 912
Deferred tax expense (13 979) (637)
Profit after tax 165 825 94 275
-------- --------
Total comprehensive income for the year 165 825 94 275
Non-controlling interest (7 427) 4 920
Profit for the period attributable to
equity holders 158 398 99 195
------------------------------------------------ -------- --------
284 461 225 426
Weighted average number of shares in issue 222 685
Diluted weighted average number of shares 285 813 229 775
in issue 260 959
Basic earnings per share (euro cents) 55.68 44.00
Diluted earnings per share (euro cents) 55.42 43.17
------------------------------------------------ -------- --------
CONSOLIDATED STATEMENT OF FINANCIAL POSITION Reviewed Audited
31 Dec 2015 31 Dec
2014
--------------------------------------------- ------------ --------
ASSETS
------------ --------
1 368
Non-current assets 1 829 440 193
------------ --------
1 269
Investment property 1 732 760 299
------------ --------
Investment property at fair value 1 576 019 978 980
Investment property under development 156 741 208 246
------------ --------
Advances paid for investment property - 82 073
------------ --------
Goodwill 23 986 17 639
Investments in joint ventures 15 640 13 241
Long-term loans granted to joint ventures 36 674 30 395
Other long-term assets 18 098 37 444
Financial assets at fair value through
profit or loss 2 282 175
Current assets 381 097 148 705
------------ --------
Trade and other receivables 54 487 40 469
108
Cash and cash equivalents 326 610 236
------------ --------
Investment property held for sale 25 255 27 360
---------------------------------------------- ------------ --------
1 544
Total assets 2 235 792 258
---------------------------------------------- ------------ --------
EQUITY AND LIABILITIES
1 241
Total equity attributable to equity holders 1 496 550 289
------------ --------
Share capital 2 986 2 746
1 074
Share premium 1 213 325 310
Share-based payment reserve 4 797 4 127
Currency translation reserve (1 229) (1 229)
167
Accumulated profit 275 042 133
Non-controlling interest 1 629 (5 798)
---------------------------------------------- ------------ --------
Total liabilities 739 242 302 969
---------------------------------------------- ------------ --------
241
Non-current liabilities 661 717 345
------------ --------
171
Bank borrowings 162 788 071
Bonds 392 140 -
Deferred tax liabilities 89 652 57 517
Other long-term liabilities 14 988 9 171
Financial liabilities at fair value through
profit or loss 2 149 3 586
------------ --------
Current liabilities 77 525 61 624
------------ --------
Trade and other payables 62 827 38 365
Bank borrowings 13 424 23 259
------------ --------
Interest accrued on bonds 1 274 -
------------ --------
1 544
Total equity and liabilities 2 235 792 258
---------------------------------------------- ------------ --------
SEGMENTAL ANALYSIS Retail Office Industrial Corporate Total
-------------------------- ------- ------- ---------- --------- -------
2015 Reviewed
-------------------------- ------- ------- ---------- --------- -------
Contractual rental income
and expense recoveries 120 046 26 728 2 025 - 148 799
-------------------------- ------- ------- ---------- --------- -------
Profit before net finance
expense 162 501 15 856 1 295 (2 480) 177 172
-------------------------- ------- ------- ---------- --------- -------
1 532 2 235
Total Assets 260 380 016 17 099 306 417 792
-------------------------- ------- ------- ---------- --------- -------
Total Liabilities 241 875 99 038 2 372 395 957 739 242
-------------------------- ------- ------- ---------- --------- -------
2014 Audited
-------------------------- ------- ------- ---------- --------- -------
Contractual rental income
and expense recoveries 59 496 25 541 1 980 - 87 017
-------------------------- ------- ------- ---------- --------- -------
Profit before net finance
expense 67 431 18 719 1 728 1 474 89 352
-------------------------- ------- ------- ---------- --------- -------
1 153 1 544
Total Assets 768 292 647 17 208 80 635 258
-------------------------- ------- ------- ---------- --------- -------
Total Liabilities 167 993 129 111 2 382 3 483 302 969
-------------------------- ------- ------- ---------- --------- -------
BUSINESS COMBINATIONS Aupark Kosice Iris Titan City Business
18 Dec 2014* Shopping Center Centre
1 Jul 2015 30 Nov 2015
------------------------- -------------- ---------------- -------------
Investment property 165 000 86 000 28 533
------------------------- -------------- ---------------- -------------
Current assets 9 599 5 164 1 038
------------------------- -------------- ---------------- -------------
Current liabilities (8 677) (960) (256)
------------------------- -------------- ---------------- -------------
Non-current liabilities (82 875) (1 154) (5 610)
------------------------- -------------- ---------------- -------------
Deferred tax liabilities (11 189) (4 905) (2 063)
------------------------- -------------- ---------------- -------------
Total identifiable net
assets at fair value 71 858 84 145 21 642
------------------------- -------------- ---------------- -------------
Goodwill arising on
acquisition 11 189 4 905 2 717
(MORE TO FOLLOW) Dow Jones Newswires
February 09, 2016 02:00 ET (07:00 GMT)
------------------------- -------------- ---------------- -------------
Total consideration
payable 83 047 89 050 24 359
------------------------- -------------- ---------------- -------------
Amounts retained from
sellers (1 500) - (5 000)
------------------------- -------------- ---------------- -------------
Total consideration
paid in cash 81 547 89 050 19 359
------------------------- -------------- ---------------- -------------
* Transaction finalised in 2015
CONSOLIDATED STATEMENT Share Share Share-based Currency Accumulated Non-controlling Total
OF CHANGES IN EQUITY capital premium payment translation profit interest
reserve reserve
----------------------------------------------------------- ------- ------- ----------- ----------- ----------- --------------- -------
Balance at 1 January 712
2014 1 999 632 296 3 453 (1 229) 76 595 (878) 236
----------------------------------------------------------- ------- ------- ----------- ----------- ----------- --------------- -------
Transactions with 434
owners 747 442 014 674 - (8 657) - 778
----------------------------------------------------------- ------- ------- ----------- ----------- ----------- --------------- -------
428
- Issue of shares 715 427 289 - - - - 004
----------------------------------------------------------- ------- ------- ----------- ----------- ----------- --------------- -------
- Share-based payment
reserve - - 11 882 - - - 11 882
----------------------------------------------------------- ------- ------- ----------- ----------- ----------- --------------- -------
* Sale of shares issued under the Current Share Scheme 12 3 293 (431) - - - 2 874
----------------------------------------------------------- ------- ------- ----------- ----------- ----------- --------------- -------
* Vesting of shares issued under the Initial Share
Scheme - - 675 - - - 675
----------------------------------------------------------- ------- ------- ----------- ----------- ----------- --------------- -------
* Vesting of shares issued under Current Share Scheme 13 4 791 (4 804) - - - -
----------------------------------------------------------- ------- ------- ----------- ----------- ----------- --------------- -------
* Reclassification of Current Share Scheme 7 6 641 (6 648) - - - -
----------------------------------------------------------- ------- ------- ----------- ----------- ----------- --------------- -------
- Earnings distribution - - - - (8 657) - (8 657)
----------------------------------------------------------- ------- ------- ----------- ----------- ----------- --------------- -------
Total comprehensive
income - - - - 99 195 (4 920) 94 275
----------------------------------------------------------- ------- ------- ----------- ----------- ----------- --------------- -------
- Profit for the
period - - - - 99 195 (4 920) 94 275
----------------------------------------------------------- ------- ------- ----------- ----------- ----------- --------------- -------
Balance at 31 December 1 074 1 241
2014 2 746 310 4 127 (1 229) 167 133 (5 798) 289
----------------------------------------------------------- ------- ------- ----------- ----------- ----------- --------------- -------
Balance at 1 January 1 074 1 241
2015 2 746 310 4 127 (1 229) 167 133 (5 798) 289
----------------------------------------------------------- ------- ------- ----------- ----------- ----------- --------------- -------
Transactions with
owners 240 139 015 670 - (50 489) - 89 436
----------------------------------------------------------- ------- ------- ----------- ----------- ----------- --------------- -------
129
- Issue of shares 205 129 767 - - - - 972
----------------------------------------------------------- ------- ------- ----------- ----------- ----------- --------------- -------
* Sale of shares issued under the Initial Share Scheme 35 9 248 - - - - 9 283
----------------------------------------------------------- ------- ------- ----------- ----------- ----------- --------------- -------
* Vesting of shares issued under the Initial Share
Scheme - - 670 - - - 670
----------------------------------------------------------- ------- ------- ----------- ----------- ----------- --------------- -------
(50
- Earnings distribution - - - - (50 489) - 489)
----------------------------------------------------------- ------- ------- ----------- ----------- ----------- --------------- -------
Total comprehensive 165
income - - - - 158 398 7 427 825
----------------------------------------------------------- ------- ------- ----------- ----------- ----------- --------------- -------
- Profit for the 165
period - - - - 158 398 7 427 825
----------------------------------------------------------- ------- ------- ----------- ----------- ----------- --------------- -------
Balance at 31 December 1 213 1 496
2015 2 986 325 4 797 (1 229) 275 042 1 629 550
----------------------------------------------------------- ------- ------- ----------- ----------- ----------- --------------- -------
RECONCILIATION OF NET ASSET VALUE TO ADJUSTED Reviewed Audited
NET ASSET VALUE 31 Dec 31 Dec
2015 2014
----------------------------------------------- -------- -------
Net Asset Value per the Statement of financial 1 496 1 241
position 550 289
-------- -------
Loans in respect of the Initial Share Scheme 64 9 132
-------- -------
Deferred tax liabilities 89 652 57 517
-------- -------
(17
Goodwill (23 986) 639)
-------- -------
Deferred tax liabilities/(assets) for joint
ventures 3 919 (1 610)
-------- -------
1 566 1 288
Adjusted Net Asset Value 199 689
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----------------------------------------------- -------- -------
Net Asset Value per share (euro) 5.01 4.52
-------- -------
Adjusted Net Asset Value per share (euro) 5.25 4.63
-------- -------
Number of shares for Net Asset Value per 298 565 274 526
share purposes 564 188
-------- -------
Number of shares for adjusted Net Asset 298 590 278 138
Value per share purposes 564 240
----------------------------------------------- -------- -------
RECONCILIATION OF PROFIT FOR THE PERIOD Reviewed Audited
TO HEADLINE EARNINGS 31 Dec 31 Dec
2015 2014
---------------------------------------------- -------- --------
Profit for the period attributable to equity
holders 158 398 99 195
-------- --------
Fair value adjustments of investment property (81 742) (27 980)
-------- --------
Gain on sale of investment property - (619)
-------- --------
Gain on acquisition of subsidiaries - (1 400)
-------- --------
Total tax effects of adjustments 14 333 4 952
-------- --------
Fair value adjustment of investment property
for joint ventures (8 204) (7 247)
-------- --------
Total tax effects of adjustments for joint
ventures 1 312 1 160
---------------------------------------------- -------- --------
Headline earnings 84 097 68 061
---------------------------------------------- -------- --------
284 461 225 426
Weighted average number of shares in issue 222 685
Diluted weighted average number of shares 285 813 229 775
in issue 260 959
Headline earnings per share (euro cents) 29.56 30.19
Diluted headline earnings per share (euro
cents) 29.42 29.62
---------------------------------------------- -------- --------
CONDENSED CONSOLIDATED STATEMENT OF CASH Reviewed Audited
FLOWS 31 Dec 31 Dec
2015 2014
------------------------------------------------- -------- --------
Profit after tax 165 825 94 275
------------------------------------------------- -------- --------
Adjustments (66 987) (33 574)
------------------------------------------------- -------- --------
Changes in working capital 1 378 (10 406)
------------------------------------------------- -------- --------
Cash flows from operating activities 100 216 50 295
------------------------------------------------- -------- --------
Proceeds from issue of shares 139 255 430 878
------------------------------------------------- -------- --------
Earnings distribution (50 489) (8 657)
------------------------------------------------- -------- --------
Net movements in bank loans and bonds borrowings 297 522 (43 704)
------------------------------------------------- -------- --------
Other proceeds/payments (2 395) -
------------------------------------------------- -------- --------
Cash flows from financing activities 383 893 378 517
------------------------------------------------- -------- --------
(265 (437
Investments in acquisitions and developments 735) 863)
------------------------------------------------- -------- --------
Net cash flow from investments in financial
assets - 64 795
------------------------------------------------- -------- --------
(265 (373
Cash flows used in investing activities 735) 068)
------------------------------------------------- -------- --------
Net increase in cash and cash equivalents 218 374 55 744
------------------------------------------------- -------- --------
Cash and cash equivalents brought forward 108 236 52 492
------------------------------------------------- -------- --------
Cash and cash equivalents carried forward 326 610 108 236
------------------------------------------------- -------- --------
LOANS AND Type Secured/ Ownership Outstanding Available 2016 2017 2018 2019 2020 2021
BORROWINGS Unsecured amount for and
REPAYMENT drawdown beyond
PROFILE
---------------- ---------- ---------- --------- ----------- --------- ----- ----- ----- ----- ----- ------
Fixed
NE Property coupon 400
Cooperatief bonds Unsecured 100% 400 000 - - - - - - 000
---------------- ---------- ---------- --------- ----------- --------- ----- ----- ----- ----- ----- ------
Aupark Kosice Term 58
Mall loan Secured 100% 80 143 24 857 5 526 5 526 5 526 5 526 039 -
---------------- ---------- ---------- --------- ----------- --------- ----- ----- ----- ----- ----- ------
Floreasca Term 39
Business Park loan Secured 100% 47 787 - 3 920 3 920 947 - - -
---------------- ---------- ---------- --------- ----------- --------- ----- ----- ----- ----- ----- ------
Term 43
Aupark Zilina loan Secured 100% 47 415 - 3 557 858 - - - -
---------------- ---------- ---------- --------- ----------- --------- ----- ----- ----- ----- ----- ------
Ploiesti
Shopping
City (joint Term
venture) loan Secured 50% 16 334 - 1 095 1 095 1 095 1 095 1 095 10 859
---------------- ---------- ---------- --------- ----------- --------- ----- ----- ----- ----- ----- ------
The Office,
Cluj-Napoca Term
(joint venture) loan Secured 50% 8 814 - 683 450 450 450 6 781 -
---------------- ---------- ---------- --------- ----------- --------- ----- ----- ----- ----- ----- ------
NE Property Revolving
Cooperatief facility Unsecured 100% - 80 000 - - - - - -
---------------- ---------- ---------- --------- ----------- --------- ----- ----- ----- ----- ----- ------
104 14 54 47 65 410
Total 600 493 857 781 849 018 7 071 915 859
---------------------------------------- --------- ----------- --------- ----- ----- ----- ----- ----- ------
The reference base rate (1 month EURIBOR, 3 month EURIBOR) was
hedged with a weighted average interest rate cap of 0.3% for 41% of
the outstanding notional amount and a weighted average interest
rate swap of 1.7% for 59% of the outstanding notional amount.
BASIS OF PREPARATION - IFRS ACCOUNTS
The reviewed condensed consolidated financial results for the
year ended 31 December 2015 have been prepared in accordance with
the recognition and measurement criteria of the International
Financial Reporting Standards ("IFRS") and interpretations adopted
by the International Accounting Standards Board ("IASB"), the
presentation and the disclosure requirements of IAS 34 Interim
Financial Reporting and the JSE Listings Requirements. The
accounting policies which have been applied are consistent with
those used in the preparation of the annual financial statements
for the year ended 31 December 2014. The directors take full
responsibility for the preparation of this preliminary report.
PricewaterhouseCoopers LLC have issued an unmodified review
report on the condensed consolidated financial statements for the
year ended 31 December 2015 which is available for inspection at
the Company's registered office.
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