AFFINE (EPA:IML) 1H12 - Rising current operating profit (+0.6%)

Transparency directive : regulatory news

26/07/2012 18:00

Paris, 27 July 2012, 18:00

                     2012 consolidated half-year results

                   RISING CURRENT OPERATING PROFIT (+0.6%)
                   SHARP PROGRESS IN EPRA EARNINGS (+24%)
          INCREASE IN RENTAL INCOME ON A LIKE-FOR-LIKE BASIS (+3.5%)
                          EPRA NAV PER SHARE: EUR28
                          EFFECTIVELY-MANAGED DEBT

KEY FIGURES

(EURm)                                              H1 2011     2011   H1 2012
Net rental income                                      22.0     43.1      20.3
Current operating profit                               17.3     34.6      17.4
Net profit                                             23.4     16.6       0.9
EPRA earnings                                           7.8     18.5       9.7
Fair value of assets (incl. taxes)                    741.3    709.0     701.8
EPRA net asset value per share (excl. taxes) (EUR)     29.3     29.0      28.2

Since 1 October 2011, the Banimmo sub-group and Jardins des Quais are
consolidated in Affine's accounts through the equity method. To facilitate the
readability of the financial statements and their comparability with previous
periods, the consolidated financial statements commented on below are proforma
statements, in which Banimmo and Jardins des Quais are consolidated through the
equity method on the full period. Banimmo's financial statements are currently
subject to limited audit review.

The Board of Directors of Affine, meeting on 25 July 2012, approved the
condensed consolidated half-year financial statements as at 30 June 2012. The
limited audit review is currently under process.

1) BUSINESS ACTIVITIES

Over the first-half, Affine signed 22 new leases concerning a surface area of
6,000 sqm and total annual rents of EUR0.9m. On the other hand, 6 tenants
cancelled their leases, representing a surface area of 6,300 sqm and annual
rents of EUR0.6m. Finally, 6 leases were renegotiated for a total amount of
EUR1.1m.

Following its eco-renovation, the high-rise building located in the street of
Traversière in Paris, which has been fully leased to SNCF until 2021, was
awarded the BREEAM label. In line with the higher standards achieved, works
meeting PRM (People with Reduced Mobility) regulations are currently underway.

On 24 March, Affine, alongside the Mayor of Arcachon and Eiffage (developer of
the site), inaugurated the Arcachon municipal market, which marks the end of
the town centre's redevelopment for which the Group has invested in 2,400 sqm
of ground-floor retail premises and an apartment hotel.

In May, the company acquired 6,250 sqm of office space in the Lille Europe
high-rise, in which Affine already owns ten of the building's twenty floors.
The tower, which overlooks Lille Europe international TGV station, is one of
Lille's prime locations and provides easy access by rail, car or public
transport. It should benefit from the increased traffic of Gare Lille Europe,
the concentration of Lille Métropole's tertiary activities at Euralille, and
urban planning projects that are currently being studied. This transaction is
in line with Affine's development strategy, which seeks to prioritise buildings
that offer significant potential for value creation in the short and long term.

Finally, the company has undertaken major renovation work on the Auber building
and for the partial conversion of the Réaumur building into a residential
property.

Affine continued to streamline its portfolio with the disposal in the first
half of the year of several mature or small-sized properties for a total of
EUR12.7m: offices in Toulouse (658 sqm), Valbonne (700 sqm) and
Saint-Julien-les-Metz (3,240 sqm); industrials in Lezennes (908 sqm); retails
in Vert-Saint-Denis (4,565 sqm); and the sale by apartment in Saint-Cloud.
Properties were sold at prices slightly below fair value at end of 2011.

2) INCREASE IN CURRENT OPERATING PROFIT

The current operating profit increased by 0.6%. This results from the property
development business (EUR1.7m compared with EUR0.3m, excluding impairment of
inventories) and the 11.5% reduction in operating expenses (EUR5.3m compared
with EUR6.0m), which more than offset the erosion of revenue on finance lease
transactions (EUR0.7m compared with EUR1.0m) and the loss in revenue resulting
from property disposals. On a like-for-like basis, rental income rose by 3.5%.

At the same time, EPRA earnings increased sharply (+24%) to EUR9.7m compared
with EUR7.8m for the same period last year. The company benefited from
improvement in profit recorded by associates.

After accounting for the unfavourable changes in the fair value of properties
(-EUR4.8m compared with +EUR10.7m in the half-year to the end of June 2011) and
impairment of financial instruments (-EUR1.3m compared with +EUR3.0m), net
profit stood at EUR0.9m (compared with EUR23.4m).

Operating cash flow totalled EUR9.6m, compared with EUR16.2m for the same
period in 2011, a decrease due to loss of rental income and rise in WCR mainly
due to current development operations.

3) SLIGHT DECLINE IN NET ASSET VALUE

At the end of the first half of 2012, the fair value of investment properties
amounted to EUR702m (including transfer taxes), a slight decrease (-1.0%)
compared with the end of 2011, both because acquisitions (EUR10.3m) only
partially offset disposals (-EUR13.3m) and a fall in fair value on a
like-for-like basis (-0.7%).

EPRA net asset value (excluding transfer taxes), less quasi-equity (perpetual
subordinated loan notes: TSDI) and after fair value of derivatives and deferred
tax adjustments, stood at EUR279.5m at the end of June 2012, a decrease of
EUR8.1m (-2.8%) compared with the end of 2011, mainly due to the payment of the
2011 dividend. Per share (excluding treasury shares and after dilution of
convertible bonds: ORA), the NAV went from EUR29.0 to EUR28.2. Inclusive of
transfer taxes, the EPRA NAV was EUR319.6m, or EUR32.2 per share.

4) EFFECTIVELY-MANAGED DEBT

The group secured new loans totalling EUR24m from three French banks during the
period. For the first half-year 2012, the average cost of debt was 2.7% (3.9%
including hedging costs). The average term of the debt is 5.7 years and no
significant debt is due to mature prior to 2016.

At 30 June 2012, the group's net debt totalled EUR439m (compared with EUR435m
at end-2011). For the property activity alone, the LTV ratio (net bank debt/
market value of properties, transfer taxes included, excluding off-plan sales
(VEFA), plus NAV of equity-associates) was 52.1% compared with 51.9% at the end
of June 2011.

5) OUTLOOK

Continuing with non-strategic asset disposals will strengthen the financial
structure, while the group will endeavour, depending on the opportunities, to
continue its investments.

Affine's priorities for the second half of 2012 continue to focus on reducing
vacancies, streamlining rental management, particularly through improving the
Group's internal procedures. The 2012 refinancing programme is almost
completed.

Finally, the company should announce by this autumn the terms under which
Affine and AffiParis will be combined.

6) SCHEDULE

* 30 October 2012: Third quarter revenues

* February 2013: 2012 annual revenues and results

* April 2013: Shareholders' Meeting

* May 2013: First quarter revenues

CONSOLIDATED REVENUE
(EURm) (1)                                          H1 2011     2011   H1 2012

Gross rental income                                    24.7     48.3      23.1
Net rental income                                      22.0     43.1      20.3
Other income                                            1.3      3.6       2.4
Operating expenses                                     (6.0)   (12.0)     (5.3)
Current EBITDA (2)                                     17.3     34.7      17.4
Current operating profit                               17.3     34.6      17.4
Other income and expenses                              (1.5)    (2.6)     (2.2)
Net profit or loss on disposal                          0.9      2.9      (0.7)
Operating profit (before value adj.)                   16.6     34.9      14.5
Balance net of value adjustments                       10.7      1.7      (4.8)
Net operating profit                                   27.3     36.6       9.7
Net financial cost                                     (9.0)   (18.2)     (8.9)
Fair value adjustments of hedging instr.                3.0     (2.3)     (1.3)
Taxes                                                  (1.3)    (0.4)      0.2
Associates                                              3.1      1.3       0.4
Miscellaneous (3)                                       0.3     (0.4)      0.8
Net profit                                             23.4     16.6       0.9
Net profit - Group share                               21.8     15.3       1.7

(1) Based on IFRS standards and EPRA recommendations.
(2) Recurring EBITDA represents the current operating profit excluding current
impairment and amortisation and depreciation. In H1 2011, 2011 and H1 2012,
this amount excludes the impairment of properties in the development business
of EUR2.0m, EUR3.0m and EUR1.9m respectively, which are recognised under other
income and expenses.
(3) Net profit from activities that have been discontinued or are being sold,
other financial income and expenses.

EPRA EARNINGS

(EURm)                                             H1 2011     2011   H1 2012

Net profit - Group share                              21.8     15.3       1.7
Value adjustments for investment properties          (10.7)    (1.7)      4.8
et profit or loss on disposal                         (0.9)    (2.9)      0.7
Goodwill adjustment                                      -        -         -
Fair value adjustments of hedging instr.              (3.0)     2.3       1.3
Associates non-cash item                              (2.9)     1.3       1.1
Net profit from discontinued operations                  -        -         -
Non-current tax, deferred and exit tax                 0.7      0.5      (0.2)
Other non-recurring items                              1.2      3.0       1.3
Minority interests in above items above                1.6      0.8      (1.1)
EPRA earnings (4)                                      7.8     18.5       9.7

(4) EPRA is a trade association of European real estate companies listed on the
stock market. In September 2011, this association updated a guide on
performance measurement. As explained in the note on EPRA adjustments, EPRA
earnings exclude changes in fair value, capital gains or losses on disposal and
other non-recurrent items.

About the Affine Group:

A property company specializing in commercial real estate, Affine and its
subsidiary AffiParis own and manage, at the end of June 2012, 65 properties
worth EUR702m, with a total surface area of 524,000 sqm. The firm owns office
properties (60%), retail properties (11%) and warehouses (28%). Its activity is
distributed more or less equally between Ile-de France and the other French
regions.

Affine is also the reference shareholder of Banimmo (49.5%), a Belgian property
repositioning company with a presence in Belgium, France and Luxembourg, and
owned Concerto European Developer, a subsidiary specializing in logistics
development.

In 2003, Affine opted for the tax treatment applicable to French real estate
investment trusts (SIIC). The Affine share is listed on NYSE Euronext Paris
(Ticker: IML FP/BTTP.PA; ISIN code: FR0000036105) and admitted to the deferred
settlement system (long only). The Affine share is included in the
CAC Mid&Small, SIIC IEIF and EPRA indices. AffiParis and Banimmo are also
listed on NYSE Euronext. www.affine.fr

Contact

INVESTOR RELATIONS              PRESS RELATIONS
Frank Lutz                      Citigate Dewe Rogerson - Agnès Villeret
+33 (0)1 44 90 43 53 -          +33 (0)1 53 32 78 95 -
frank.lutz@affine.fr            agnes.villeret@citigate.fr

  SOCIÉTÉ ANONYME WITH SHARE CAPITAL OF 53,100,000 EUROS - REGISTERED OFFICE:
                       5 RUE SAINT-GEORGES, 75009 PARIS
TEL: +33 (0)1 44 90 43 00 - FAX: +33 (0)1 44 90 48 00 - EMAIL: INFO@AFFINE.FR
             PARIS TRADE AND COMPANIES REGISTER NO. 712048735 -
                    INTRA-COMMUNITY VAT NO. FR92712048735

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