Presentation H1 2015 Results

The golden mile
1H 2015 Results
Disclaimer
Qrf CVA (hereafter “Qrf”), having its registered office at Leopold de Waelplaats 8/1, 2000 Antwerp, is a public Regulated Real Estate Company, incorporated
under Belgian law and listed on Euronext Brussels.
This presentation is directed to financial analysts and institutional investors and is not to be considered as an incentive to invest or as an offer to acquire Qrf
shares. The information herein is extracted from Qrf’s annual and half-yearly reports and press releases, but does not reproduce the entire content of these
documents.
Furthermore, this presentation contains forward-looking statements involving risks and uncertainties, including statements regarding Qrf's plans, targets,
expectations and intentions. Readers are reminded that such forward-looking statements involve known and unknown risks and are subject to major
corporate, economic and competitive uncertainties to a large extent outside the control of Qrf. Should one or more of these risks or uncertainties materialize,
or should assumptions used prove incorrect, the final results could substantially vary from those anticipated, expected, estimated or projected. Qrf
consequently assumes no responsibility for the accuracy of these forecasts.
2
Management team
ANNELEEN
DESMYTER
CEO
• Founding Partner of Quares
• Founded CC Company NV,
currently Quares Residential
Agency, in 2004
• Formerly project developer in
corporate real estate for Eurinpro
Retail experience with Quares
Retail Fund, Quares Retail Fund 2
and the bond issue for the
acquisition of the high street
shopping centre Century Center
Antwerpen
3
PREBEN
BRUGGEMAN
CFO
• Previously active on capital
markets operations and M&A
transactions in the real estate
sector at Bank Degroof
• Prior equity analyst at Bank
Degroof covering the listed
real estate sector
BERT
WEEMAES
COO
• Former director at City Mall, a
real estate retail developer
• Previously held positions as
member of the Board, CFO and
Development & Real Estate
Director at Decathlon Benelux
Retail experience with
k Kortrijk, Les Grands Prés Mons
expansion and Shopping Le Côté
Verre Namur and the expansion
of Decathlon Benelux
QRF SUCCESSFULLY COMPLETES ITS FIRST YEAR AS A LISTED COMPANY
1I Qrf in a nutshell
2I Market vision and strategy
3I Accomplishments of 1H 2015
4I Key portfolio statistics
5I Financials
6I Qrf share
7I Outlook
1I QRF IN A NUTSHELL
Qrf in a nutshell
General company information
Property portfolio
• Qrf is a Belgian REIT listed on Euronext
Brussels since December 2013
25%
• Qrf is a pure player investing in Belgian
retail properties ...
• … with a focus on inner-city retail
(75% inner-city / 25% periphery)
Inner-city
Fair Value
150.2 M EUR
Periphery
75%
Shareholder structure
6,1%
• Location HQ : Antwerp, Belgium
5,9%
Dembitzer Family
4,8%
• Market capitalisation of 86,8 MEUR (1)
BNP Paribas
Investment Partners
Belgium NV
• Fair value of the portfolio of 150,2 MEUR
Capfi Delen Asset
Management NV
83,2%
6
(1) Based on closing price as of 30 June 2015
Free float
2I MARKET VISION AND STRATEGY
WE INVEST IN, (RE)DEVELOP AND
RENT OUT PRIME RETAIL REAL
ESTATE IN THE ‘GOLDEN MILE’
OF BELGIAN CITIES
8
Our vision on cities
• Centralised social & cultural life, economic activity and increased mobility are key drivers for city development
• Growing population supports increasing consumer spending and retail activity
VIBRANT SOCIAL & CULTURAL LIFE
INCREASED MOBILITY & DESTINATION PROXIMITY
ECONOMIC ACTITVITY & EMPLOYMENT
POPULATION GROWTH IN THE 15 LARGEST FLEMISH CITIES AND BRUSSELS
1,3
1,25
1,2
1,15
1,1
1,05
1
0,95
2005
2006
2007
2008
2009
2010
2011
Source: Belgian FOD Economie & Studiedienst Vlaamse Regering
2012
2013
2014
2015
2016
2017
2018
2019
2020
Antwerpen
Mechelen
Beringen
Genk
Hasselt
Aalst
Dendermonde
Gent
Sint-Niklaas
Leuven
Brugge
Kortrijk
Oostende
Roeselare
Turnhout
Brussels Hoofdstedelijk Gewest
9
Our vision on the Golden Mile
Must-have locations for retailers
High liquidity of properties
Defensive play
Scarcity effect
10
Investment & diversification strategy
Asset type
-
Focus on high quality retail
properties on city locations
Properties with shop
windows > 5 meter
Location
-
-
Located in high streets that
are dominant in their
catchment area
i.e. the golden mile in
catchment areas of >
50,000 consumers
Focus on :
• Quality and
accessibility of the
assets
• Quality of the tenants
and the underlying
rental contracts
• Adherence to laws
and regulations
• Re-rental potential of
the property
11
3I ACCOMPLISHMENTS OF 1H 2015
1H 2015 Highlights
Main highlights
Focus on Belgian inner-city retail properties that are
dominant in their catchment area
•
•
•
8% portfolio growth in 1H 2015
Resulting in 537 KEUR additional yearly rent
The part of inner-city real estate increases to 75%
Diversified in terms of tenants, individual asset size and
geographical spread
•
Acquisitions in Gent, Oudenaarde, Antwerp and Namur with a
nice tenant mix: Esprit, Armand Thiery, Gerry Weber, ...
Capital increase
•
•
•
Contribution in kind of 2 retail properties located in Antwerp
& Namur
193,097 new issued shares
Increasing the shareholders’ equity by 4.73 MEUR
Active portfolio management
•
•
•
2 renewals of rental contracts with rental increase
0 rental contracts ended
Several pop-up stores
Sustainability and social responsibility
•
•
•
Establishing sustainable relationships with stakeholders
Being attentive to environmental impact
Supporting young artists which promote the inner-city
13
Resulting in acquisitions on 4 locations
Namur
Gent
Investment value of approx.
11 MEUR
Oudenaarde
14
Antwerpen
Acquisitions in 1H 2015
Date of
transaction
City
Street
Tenant(s)
GLA
April 21, 2015
Oudenaarde
Nederstraat 43-45
Esprit
BVBA)
May 27, 2015
Gent
Lange Munt 61-63
Gerry Weber
638 m²
132 KEUR
June 24, 2015
Namen
Rue de Fer 10
Armand Thiery
192 m²
180 KEUR
June 24, 2015
Antwerpen
Kammenstraat 34
Dstrezzed
161 m²
75 KEUR
(Jomi 1.228 m²
TOTAL
15
Contractual
rents on annual
basis
150 KEUR
537 KEUR KEU
4I KEY PORTFOLIO STATISTICS
Clear focus on inner-city
Type of property (% of Fair value)
100%
90%
80%
25%
34%
70%
60%
50%
40%
30%
75%
66%
20%
10%
0%
Situation on IPO 18/12/2013
Situation on 30/06/2015
Inner-City
17
Periphery
Well-spread tenant base
Sectoral spread (% Contractual rents on annual basis)
Fashion (H&M, Bershka, G-Star, …)
3%
Sport & Leisure (HEMA, Neckerman, Oxygen,
Standaard, ..)
Interior & Decoration (Casa, Euro Center, …)
2%
2% 2%
3%
Horeca (Panos, Mc'Donalds, …)
3%
Car (Citroën)
3%
Electro & Telecom (Van den Borre, Phone House, …)
4%
Parking
FASHION
4%
Jewelry (Twice as Nice, ...)
51%
Beautycare (Kruidvat, Hans Anders, …)
4%
Garden & do-it-yourself (Brico, …)
5%
Office articles (Ava papierwaren, …)
Shoes (Torfs, Tamaris, Janelli, …)
6%
6%
Food (Lidl, …)
Varia
18
Well-spread tenant base
Tenant spread (% Contractual rents on annual basis)
Mc DONALD'S
C&A
2,4%
Esprit
3,4%
Piocheur
3,4%
Apcoa
Bershka
Citroën
Sissy Boy
H&M
19
2,2%
FASHION
3,7%
4,3%
4,5%
5,4%
11,9%
High and stable occupancy rate
100%
99,7%
99,5%
99,0%
99%
98%
97%
96,8%
96,2%
96,0%
96%
95%
94%
93%
92%
91%
90%
30/12/2013
30/12/2014
Occupancy rate (excl. rental guarantees on vacant property)
20
30/06/2015
Occupancy rate
Portfolio valuation
Real estate portfolio (in K EUR)
Fair value of the real estate portfolio
Gross rental surface (in m²)
30.06.2015
150 228
60 248
30.12.2014
139 218
58 029
30.12.2013
114 201
51 730
6,1%
6,0%
6,2%
6,0%
6,2%
6,1%
99,0%
96,2%
99,7%
96,0%
99,5%
96,8%
Gross portfolio yield (incl. rental guarantees on vacant property)
Gross portfolio yield (excl. rental guarantees on vacant property)
Occupancy rate
Occupancy rate (excl. rental guarantees on vacant property)
FASHION
Geographical spread per region (% Fair Value)
Geographical spread per province (% Fair Value)
3% 2%
2%
Antwerp
2%
6%
Liège
5%
21%
Flanders
Wallonia
East Flanders
5%
43%
11%
Brussels Capital
Region
Flemish Brabant
Brussels
74%
13%
21
Limburg
Luxembourg
15%
Namur
5I FINANCIALS
1H 2015 consolidated income statement
1H 2015
1H 2014
∆
Net rental income
4 320
3 832
+12,7%
Property result
4 354
3 792
(-) Property costs
-261
-165
(-) General costs and other operating income and costs
-714
-597
3 379
3 030
78,2%
79,1%
33
-1 013
-861
-847
-2
-54
1
6
2 550
1 122
-33
1 013
-
-
2 517
2 135
+17,9%
1H 2015
1H 2014
∆
3 279 277
0,78
0,77
3 272 911
0,34
0,65
+17,6%
P&L (in K EUR)
Operating result before result on the portfolio
Operating margin
(+/-) Portfolio result (IAS 40)
(+/-) Financial result
(-) Taxes
(-) Minority interests
Net result - group share (IFRS)
(+/-) Correction for Portfolio result (IAS 40)
(+/-) Correction for Changes in fair value of non-effective hedging
instruments (IAS 39)
Net current result - group share (EPRA)
Per share data (in EUR)
Weighted average number of shares
Net result - group share (IFRS)
Net current result - group share (EPRA)
23
+11,5%
1H 2015 consolidated balance sheet
Balance sheet (in K EUR)
Non-current assets
Intangible assets
Investment properties
Other non-current assets
Current assets
Trade receivables
Tax receivables and other current assets
Cash and cash equivalents
Deferred charges and accrued income
Total assets
Total sharehoders' equity
Shareholders' equity
Minority interests
Non-current liabilities
Non-current financial debts
Other non-current liabilities
Current liabilities
Current financial debts
Other current liabilities
Total sharehoders' equity and liabilities
Per share data (in EUR)
Total number of shares outstanding
NAV (IFRS)
NAV (EPRA)
24
30.06.2015
150 271
4
150 228
39
4 887
596
373
3 867
51
30.12.2014
139 265
4
139 218
43
4 682
1 015
700
2 835
132
155 158
143 947
79 002
78 702
300
73 089
69 833
3 255
3 069
3 069
76 001
75 700
301
64 516
61 871
2 645
3 430
3 430
155 158
143 947
30.06.2015
3 466 008
22,71
23,58
30.12.2014
3 272 911
23,13
23,87
Financial structure
Comments
Debt maturities
(in MEUR)
• Financial debt amounts to 70 MEUR
30,0
25,0
20,0
• Weighted average remaining duration of drawn credit
lines of 3,4yr
10
15,0
10
• Debt is provided by 3 financial institutions
10,0
15
5,0
15
15
5
10
10
• No expiry dates in FY 2015
5
0,0
2015
2016
2017
Expiry dates of drawn credit lines
2018
2019
2020
Expiry dates of available credit lines
Hedging
14,3%
Fixed interest rate
85,7%
25
2021
Floating interest
rate
• 25 MEUR committed non-withdrawn credit lines available
• Debt ratio of 47,0% (strategic target 50-55%)
• Additional investment capacity of 27 MEUR (before 55%
debt ratio)
• 86% hedged by Interest Rate Swaps with the same
duration as the drawn credit lines
• Average financing cost of 2,36% in 1H 2015
6I QRF SHARE
26
Qrf share
Evolution of stock price and NAV
Key data per share
(in KEUR)
30.06.2015
30.12.2014
30.06.2014
(in EUR)
30,0
3 466 008
3 272 911
3 272 911
29,0
1 800
25,04
25,90
24,46
28,0
1 600
86 788 840
84 768 395
80 055 403
27,0
1 400
22,71
23,13
22,64
26,0
1 200
10,3%
12,0%
8,0%
25,0
1 000
NAV (EPRA)
23,58
23,87
23,23
24,0
800
Premium to NAV (EPRA)
6,2%
8,5%
5,3%
23,0
600
22,0
400
21,0
200
20,0
-
Per share data (in EUR)
Total number of shares
outstanding
Closing price
Market capitalisation
NAV (IFRS)
Premium to NAV (IFRS)
Dividend guidance
• Expected gross dividend for FY 2015 of at
least 1,30 EUR
2 000
• Gross dividend yield of 5,2% (1)
Volume per dag
Stock Price
NAV per share (IFRS)
27
(1) Based on closing price as of 30 June 2015
7I Outlook
Expectations on 2015
1
5
2
Sustaining dividend
level
4
29
Focus on Golden Mile
Further growth by
acquisitions
3
Diversification in regional
and main cities in Belgium
Straight-forward operating
THANK YOU
QUESTIONS?
30
Financial calendar 2015-2016
Unless stated otherwise: publications are after close of trading
31
November 13, 2015
Update Q3 2015
February 29, 2016
Yearly results 2015
April 15, 2016
Annual report 2015
May 9, 2016
Update Q1 2016
May 17, 2016 at 2.00 p.m.
General Meeting of Shareholders
May 19, 2016
Ex-dividend date
May 20, 2016
Record date
May 23, 2016
Payment date
August 19, 2016
Results of the first half year of 2016 (per 30/06/2016)
November 10, 2016
Update Q3 2016
Board of directors - Independent directors
INGE
BOETS
CHAIRMAN
• Former Partner at Ernst &
Young & leader of the Ernst &
Young Global Risk Practice.
• Mandates: Euroclear Belgium,
Econopolis, Ontex, Vanbreda
Risk & Benefits, Member of the
Audit Committee for the
Flemish Parliament, Advisor for
Board Effectiveness with
Guberna.
32
JAN
BROUWERS
• Former Managing Director
with Morgan Stanley in
London, Portfolio Manager at
Blue Crest Capital.
• Director and shareholder of
Jaran Capital and Independent
Director of Proviron Holding.
FRANK
DE MOOR
• CEO of Q-Park
• Member of the Advisory Board
of ECP (Electronic Commerce
Platform Nederland).
Board of directors - Quares directors
ANNELEEN
DESMYTER
CEO
• Founding Partner of Quares.
Founder of CC Company,
(Quares Residential Agency).
• She started her career as a
Project Manager for projects in
the Netherlands and Belgium
with Eurinpro (Goodman) a
development firm with focus
on logistic and office real
estate.
33
HERMAN
DU BOIS
• Founding Partner of Quares.
Previously Founder APM NV,
• Managing Director with BNP
Paribas Real Estate Benelux
• Financial Manager & General
Manager at Aranäs, , a
Swedish REIT.
• Founder of asset and property
management firm APM NV
sold to Atisreal in 2002.
Started his career with
Coopers & Lybrand, now PwC.
FREDDY
HOORENS
• Founding Partner of Quares.
Founder of SPM (Quares
Property Management), CC
Company, (Quares Residential
Agency).
• Previously, Property Manager
with Siref (Belgian REIT).
Exercised different
management functions at a.o.
Bellewaerde Park, Walibi,
Verelst and Eurinpro
(Goodman).
The advantages of a listed Belgian REIT
34
GENERAL
• Investment company with min. capital of € 1,200,000
• Naamloze Vennootschap (NV) / Commanditaire vennootschap op aandelen
(Comm. VA)
• Real estate investment focus
• FSMA accredited + supervision
• Promoter acts as fund initiator and manager
FINANCIAL / FISCAL
•
•
•
•
•
•
Assets at fair value (valuation each trimester by independent expert)
Maximum leverage of 65%
The taxable basis is negligible for corporate income tax purposes
Distribution of at least 80% of the profit
Withholding tax of 25% on distributed dividends
Bullet type credit facilities are common financing sources
PORTFOLIO
MANAGEMENT
•
•
•
•
•
Risk diversification over larger portfolio
Minimum diversification (single asset or tenant < 20% total assets)
Increased liquidity
Average costs decrease if direct fixed costs are spread over larger portfolio
Negotiation power with respect to tenants and suppliers increases with
portfolio size