COVIVIO HOTELS (EPA:COVH) - Income growing strongly - Strengthened financial structure

Transparency directive : regulatory news

10/02/2011 17:58

10 February 2011

                          Income growing strongly
                      Strengthened financial structure

                                       2010      2009        Change
                                                              (%)
Consolidated turnover (EUR millions)   203.5     196.8       + 3.4%
Recurring net income (EUR millions)    107.2      96.0      + 11.6%
Recurring net income per share      EUR 2.10  EUR 1.92       + 9.4%
EPRA NAV (EUR millions)              1,409.4   1,113.3      + 26.6%
EPRA NAV per share                      25.0      22.3      + 12.1%
Proposed dividend per share             1.45      1.40       + 3.4%

Income growing strongly

- Recurring net income of EUR 107.2 million, up 11.6%:

Foncière des Murs' consolidated turnover was EUR 203.5 million at 31 December
2010, up 3.4% versus 2009.

Like-for-like, Foncière des Murs' revenue was up 4.4%, including an increase of
6.8% in hotel revenue during 2010, as well as the positive effect of lease
indexation in the restaurant, health and leisure sectors.

Net recurring income of EUR 107.2 million, versus EUR 96.0 million in 2009,
reflected growth of 11.6%. Posted against average number of shares outstanding
during the year, recurring net income was EUR 2.10 at 31 December 2010, compared
to EUR 1.92 at 31 December 2009, up 9.4%.

Net income for the year totalled EUR 260.7 million, versus -EUR 168.5 million in
2009. This included the positive impact of the increased asset value of EUR
187.3 million, as well as the negative impact of the change in value of
financial hedging instruments, of EUR 26.4 million.

- NAV of EUR 1,409.4 million, up 26.6%:

At 31 December 2010, Foncière des Murs' assets were valued at EUR 3,124 million
excluding duties, up 4.6% over the 2nd half of 2010 on a like-for-like basis.
For 2010 as a whole, the value of outstanding assets was up 6.7% like-for-like.

This increase was due to Foncière des Murs' solid foundations: asset liquidity,
an average firm lease duration of nearly nine years, an occupancy rate of 100%
with top-tier tenants, and growth in turnover in the hotel segment in 2010.

EPRA NAV totalled EUR 1,409.4 million, or EUR 25/share, at 31 December 2010,
versus EUR 1,113.3 million, or EUR 22.3/share, at 30 June 2010, up 26.6%. This
growth is due to the positive change in values and the capital increase.

EPRA Triple Net NAV totalled EUR 1,221.5 million, or EUR 21.6/share, versus EUR
936.9 million, or EUR 18.8/share at 31 December 2009.

Dynamic asset management

- Good liquidity of hotel assets: EUR 203.6 million in disposals and signed sale
  agreements

Foncière des Murs sold 10 assets (including nine hotels) during fiscal year
2010, for a net sale price of EUR 90 million.

Since the beginning of the year, Foncière des Murs has also signed 16
agreements involving the sale of 14 hotels, one restaurant and one nursing home
[EHPAD], for a total price of EUR 113.6 million.

Sales of hotels subject to variable leases, specifically to private investors,
for prices higher than appraised values, confirm the liquidity of Foncière des
Murs' assets.

- Growth activities:

During fiscal year 2010, Foncière des Murs completed 2 operations:
   - An operation with Accor, in partnership with Predica, a subsidiary of
     Crédit Agricole Assurances, dealing with the acquisition of a portfolio of
     49 hotels located in France, Germany and Belgium, for a total investment
     of EUR 378 million. Foncière des Murs' investment totalled 20% of the
     deal, i.e., approximately EUR 76 million. The lease payments on these
     hotels are proportional to their turnover,
   - A operation with B&B, in July 2010, dealing with the acquisition of 19
     hotels in France and Germany. Foncière des Murs' total investment was
     some EUR 85 million. For the hotel located at Porte des Lilas, France,
     Foncière des Murs signed a VEFA sale agreement for EUR 20 million. The 18
     German assets will be acquired in the first quarter of 2011. Lease
     payments by B&B are indexed fixed lease payments.

These two deals had no impact on Foncière des Murs' income statement in 2010.

- Collaboration with tenants:

Foncière des Murs continued its policy of collaborating with existing tenants,
specifically by signing 22 new leases, securing EUR 12.9 million in annualised
lease payments with firm periods from 9 to 12 years. The firm residual duration
of the leases came out to 8.7 years.

A strengthened financial structure

In October 2010, Foncière des Murs undertook a capital increase of
EUR 97 million.

Thus, Foncière des Murs continued to strengthen its financial structure in the
second half. Net debt represented 54.3% of asset value, versus 60.8% at 30 June
2010 and 61.7% at 31 December 2009, due to the positive change in values and a
significant reduction in net debt during fiscal year 2010.

The average rate on the debt fell to 4.43%, compared to 4.57% at 31 December
2009, with an average maturity of 3.4 years. The spot rate of Foncière des
Murs' debt at 31 December 2010 was 4.06%.

The ICR ratio, which is clearly improving, was 2.31 at 31 December 2010, versus
2.08 at 31 December 2009.

Dividend up, to EUR 1.45/share

During fiscal year 2010, a proposal will be made to the General Shareholders'
Meeting to pay a dividend of EUR 1.45/share, i.e., a total dividend of EUR 81.8
million, up 17% over the 2009 dividend of EUR 70 million, or EUR 1.40/share.
The total proposed dividend represents 76% of recurring net income.

Outlook

In 2011, Foncière des Murs will seek to continue its ongoing policy of asset
turnover and of dynamic asset management, based specifically on its privileged
relationship with its tenants. Foncière des Murs is also seeking to strengthen
its status as a European leader in business premises by implementing new
partnerships.

Foncière des Murs expects its recurring net income to increase in 2011.

About Foncière des Murs

Foncière des Murs SCA, a subsidiary of Foncière des Régions, is a French
listed real estate investment trust (SIIC) specialising in business premises,
especially in the hotel, restaurant, health and leisure sectors. The company's
investment policy is focused on building partnerships with leading operators in
their sectors in order to provide its shareholders with a recurring return on
their investment.

Foncière des Murs is listed on Euronext Paris, Eurolist Compartment B
(FR0000060303 - FMU).

Contacts:
Foncière des Murs

Dominique Ozanne - Deputy General Manager
Tel.: 01 58 97 54 20
dominique.ozanne@fdr.fr

Read this press release at www.foncieredesmurs.fr

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