ALTAREA (EPA:ALTA) - NINE - MONTHS 2010 REVENUES AND BUSINESS ACTIVITY OF ALTAREA COGEDIM
Transparency directive : regulatory news
08/11/2010 17:45
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Press release Paris, November 8th 2010
9M 2010 REVENUES AND BUSINESS ACTIVITY
Shopping centres: increase in rental revenues and improvement in business
indicators
* Rental revenues from shopping centres up + 5.3% at EUR121.6m, driven by
deliveries
* Significant improvement in retailers' revenue growth: +3.3% since the start of
the year. Strong performance by retail parks (+7.2%)
* Slight fall in rental revenues on a like-for-like basis
* Improvement in tenants' occupancy cost ratio, returning to pre-crisis level
of 9.0%
Residential property: Further growth in sales
* New home reservations: EUR1.0bn incl. tax over 9 months, up +66% relative to
2009 and +98% relative to 2007, the benchmark year before the financial
crisis
* Backlog: EUR1.3bn excl. tax (30 months' revenues)
* Pipeline(1) worth EUR2.2bn incl. tax, equal to around 20 months' supply at the
current disposal rate (+32% over 9 months despite the rapid rate of sales)
Office property: first encouraging signs in a still recovering market
* Moderate improvement in take-up under continuing difficult market conditions
at EUR210m incl. tax
* Decline in revenues reflecting the delayed effect of the slowdown in business
since 2008
* Increase in backlog to EUR1 56m excl. tax
According to Alain Taravella, Chairman and Founder:
"The operating indicators are gradually turning positive across all of our
business lines, with an upturn in consumer spending at shopping centres, strong
positions obtained in residential property development and tangible signs of
recovery in office property. We have now laid the foundations for strong growth
(subject to constant economic conditions) in our earnings and cash flow for the
next two to three years. A more detailed outlook will be presented to the market
on the publication of our full-year financial statements on 7 March next year.
"
(1) Potential revenues incl. tax from development projects with land under
option + potential revenues incl. tax from properties for sale
1. Shopping centres: increase in rental revenues and improvement in business
indicators
Rental revenues rose by +5.3% over nine months as a result of:
(EUR m)
Rental revenues as of Sept. 30, 2009 115,4
Deliveries 13,1 11,4%
Remodelling (1,9) -1,7%
Disposals and acquisitions (2,0) -1,7%
Like-for-like change (3,1) -2,7%
* Deliveries
Since the start of the year, GLA of around 100,000 sqm(2) has been completed in
France (Okabe in Kremlin Bicetre, Family Village in Limoges) and Italy (Le Due
Torri in Lombardy), representing total full-year rental revenues of EUR23. 5
million(3). The occupancy rate for these properties was 9 5% on opening.
* Standing portfolio
In parallel with creating new shopping centres, the Group has pursued an intense
asset management policy across its entire portfolio, comprising the remodelling
and extension of existing properties (seven projects in progress) and asset
sales already carried out (Toulouse Saint-Georges, Paris Wagram) or under
discussion relating to properties that have reached maturity. This should enable
the Group to maintain its pace of growth in a business climate still in
recovery, as demonstrated by the -2.7% fall in like-for-like rental revenues as
a result of the combination of a number of factors (slightly negative indexation
effect(4), decline in variable rental revenues, bad debt loans and frictional
vacancy).
* Improvement in tenants' operating indicators
Retailers' revenues increased by 3.3%(5) relative to 2009. This relates to all
retail formats, with retail parks confirming the brisk momentum seen over the
last few quarters with growth of +7.2%. The performance of retail parks was
achieved in a climate in which competitive pricing has become the decisive
factor for consumers. Retail parks have therefore benefited fully from their
mass market positioning, while also offering a carefully thought-out environment
and pleasant shopping experience comparable to those offered by many shopping
centres (in particular for the latest-generation Family Villages developed by
the Group).
As a result of the combination of revenue growth and a slight drop in rental
values, tenants' occupancy cost ratio returned to close to the pre-crisis level
at 9.0% (compared with 9. 5% in 2009).
2. Residential property: very sharp increase in residential reservations:
In a particularly buoyant market - with record low interest rates, support for
first-time buyers, buy-to-let incentives and a shortage of new homes - the
Group, via its subsidiary Cogedim, has achieved strong growth quarter after
quarter, with net reservations of EUR1.0 billion including tax to 30 September
2010, representing a year-on-year increase of +66%.
(2) On a 100% basis (78,500 sqm Group share)
(3) On a 100% basis (EUR18.2 million Group share)
(4) French retail rent index (ILC): +0.84%, CCI index: -4.10%
(5) Figures to end-August on a like-for-like basis (France)
Compared with 2007, which was the benchmark year before the financial crisis,
the level of sales has almost doubled, while in the meantime the French market
has not yet returned fully to its pre-crisis level(6). This growth was achieved
entirely on an organic basis.
Cogedim is the undisputed French leader in upscale residential development,
managing prestigious projects as Paris 7 Rive Gauche on the former Laennec
hospital site in the heart of Paris (7th arrondissement).
Individual investors have accounted for just 40% of sales since the start of the
year. The Paris Region remains the most dynamic region with 63% of total sales
since the beginning of the year.
30/09/2010 30/09/2009 30/09/2008 30/09/2007
Net reservations (EURm, incl. tax) 1,000 601 455 504
% chg yoy +66% +32% -9%
% chg vs.2007 +98% +19% -9%
Number of units sold(8) 3,646 2,905 1,701 2,194
Notarised revenues (EURm, incl. tax) 698 495 410 562
Revenues (EURm, incl. tax) 382.3 385.1 437.8 355.4
Backlog(9)(EURm, excl. tax) 1,334 778 684 679
In view of the sharp increase in residential reservations that began in 2009 and
the backlog already built up, very strong revenue growth can be expected
compared with current levels at the end of 2010 and for the next two to three
years.
(6) 100,000-110,000 homes expected to be sold in 2010 compared with 127,000 in
2007 (source: French Ministry of Ecology)
(8) On a 100% basis
(9) The backlog comprises revenues excluding tax from notarised sales to be
recognised according to the percentage-of-completion method and reservations to
be notarised.
Pipeline:
(in EURm) 30/09/2010 31/12/2009
Properties for sale 458 368
Properties in the portfolio 1,748 1,301
Pipeline(10) 2,206(11) 1,669
Cogedim's commercial success relates above all to the quality of its products,
the dynamism of its staff and the attractiveness of its brand, as well as its
ability to offer properties that meet current market needs in terms of quality
and volume. Despite the very brisk rate of sales, the pipeline has grown
significantly since the start of the year (+32%), representing around 20 months'
supply at the current disposal rate. Cogedim has therefore benefited fully from
current market conditions while also maintaining rigorous management of its
risks and commitments.
3. Office property: relative upturn in commercial activity in a still
weak market
To 30 September 2010, Altarea Cogedim recorded take-up of EUR210 million incl.
tax relating to various developments or delegated project management projects,
an increase of 23. 5% relative to the total in 2009. The backlog therefore grew
in a market that is still weak but showing the first signs of recovery.
30 Sept. 2010 31 Dec. 2009 31 Dec. 2008 31 Dec. 2007
Take-up (EURm, incl. tax) 210 170 409 448
Backlog (EURm, excl. tax) 156 103 162 255
Total revenues (EURm, excl. tax) 54.4 152.0 174.1 82.0
4. Financial position
Net bank debt amounted to EUR2,229. 5 million at 30 September 2010 compared with
EUR2,098.6 million at 30 June 2010. This increase relates primarily to the
dividend paid in July, investment in recently completed development projects and
financing of the working capital requirement, as well as cash flow generated
from operations.
Contacts
Analysts, investors: Eric Dumas, Chief Financial Officer +33 1 44 95 51 42
Press: Nathalie Bardin, Communications Director
+33 1 56 26 25 36 / + 33 6 85 26 15 29
Valerie Jardat, Cote Jardat +33 1 41 05 94 10 / +33 6 12 05 18 35
(10) Potential revenues incl. tax
(11) Number of units in the pipeline : 8,500
2010
(EUR k) Q1 2010 Q2 2010 Q3 2010 Total YTD
Shopping centres
Rental revenues 40 585 40 283 40 700 121 567
External fees 1 956 2 043 2 004 6 003
Shopping centres 42 540 42 325 42 705 127 570
Third-party development
Revenues 143 972 140 095 145 637 429 704
External fees 2 343 4 443 3 089 9 874
Property development 146 315 144 538 148 725 439 578
O/w residential property
Revenues 122 644 126 144 133 502 382 290
External fees 379 1 946 556 2 881
Residential property 123 023 128 089 134 058 385 170
O/w office property
Revenues 21 328 13 952 12 135 47 415
External fees 1 964 2 497 2 532 6 993
Office property 23 292 16 449 14 667 54 408
Recurring activities 188 856 186 863 191 430 567 149
Revenues (1) 11 758 4 586 2 973 19 316
External fees 901 1 108 256 2 265
Non-recurring activities 12 659 5 694 3 228 21 581
Total revenues 201 515 192 557 194 658 588 730
2009 Variation
Q1 2009 Q2 2009 Q3 2009 Total YTD 2010 YTD -
2009 YTD
35 543 41 040 38 866 115 448 5,3%
1 917 1 903 1 964 5 784 3,8%
37 460 42 942 40 830 121 231 5,2%
166 297 177 775 155 813 499 885 -14,0%
4 442 5 251 2 698 12 391 -20,3%
170 739 183 026 158 511 512 276 -14,2%
122 349 140 156 122 564 385 069 -0,7%
751 1 422 555 2 728 5,6%
123 100 141 577 123 119 387 796 -0,7%
43 948 37 619 33 249 114 816 -58,7%
3 692 3 829 2 143 9 664 -27,6%
47 640 41 449 35 392 124 480 -56,3%
208 199 225 968 199 341 633 509 -10,5%
4 962 19 256 34 848 59 066 -67,3%
314 467 647 1 428 58,6%
5 276 19 723 35 495 60 493 -64,3%
213 475 245 691 234 836 694 001 -15,2%
(1) Non-recurring activities revenues are mainly consisting of off-plan sale
agreements connected with shopping centres under development.
Altarea Cogedim Q3 2010 revenues and business performance - Press release