from PATRIMOINE ET COMMERCE (EPA:PAT)
PATRIMOINE ET COMMERCE: 2022 ANNUAL RESULTS
PATRIMOINE ET COMMERCE
PRESS RELEASE 2022 ANNUAL RESULTS
Paris - February 22, 2023
At its meeting on February 21, 2023, the Patrimoine & Commerce Supervisory Board reviewed the Company’s operations and approved the 2022 financial statements (1), prepared by Management.
Key figures
Eric Duval, Managing Director and Founder of Patrimoine & Commerce declared: « The solid results for fiscal year 2022, both in terms of operational and financial performance, confirm the attractiveness of the Group’s business model as the leader of low-cost retail park market players in France. With over € 50m in acquisitions and € 40m in disposals during the year, we demonstrated our capacity to carry out targeted acquisitions but also the good liquidity of our assets in line with appraisers values. Supported by a robust financial structure, and our confidence in delivering a sustainable growth, we will propose a distribution of a € 1.30 dividend per share, up by +4.0% compared to last year. »
Operational performance In an uncertain economic context, characterized by inflation and the rise in interest rates, Patrimoine & Commerce saw its gross rental income increase by +8.3%, and maintained a very dynamic asset rotation strategy, with the acquisition of seven retail properties, and the disposal of eight assets during 2022. The retail park model proved its performance and alignment with current trends in consumption. Besides core strengths of the model (human-sized stores, easy car parking, limited service charges, adapted rents), retail parks stand out with an activity not very dependent on tourism, focused on local consumption, open spaces and high attractivity for discount stores. Patrimoine & Commerce had a sustained leasing activity and signed 55 leases (of which 21 renewals). The financial occupancy rate is increasing and stands at 94.3% (5) on the portfolio. The collection rate on rents and service charges invoiced in 2022 stands at 98.1%.
FFO increasing by +9.6% In 2022, Patrimoine & Commerce continued to deliver a solid financial performance. For the fiscal year ended December 31, 2022, Patrimoine & Commerce reported consolidated gross rental income of € 47.3m, against € 43.7m for the fiscal year ended December 31, 2021:
The increase of gross rental income is mainly explained by (i) the effect of the acquisitions and disposals made in 2021 and 2022 (ii) the delivery of restructuring operations on a property in Martinique and (iii) the like-for-like increase, driven by contractual indexation (2.5% in average on the period) and the decrease in the amortization of Covid-19 rent free periods.
Net rental income stands at 93% of gross rental income (stable compared to 2021), mainly composed of unrecovered rental expenses and provisions for credit losses:
Operating expenses and other revenues remained under control at € 5.0m (vs. € 4.5m in 2021), the increase derives from property management costs (leasing fees, asset management fees based on the evolution of rents).
Net cost of debt amounted to € 9.5m in 2022, almost stable compared to last year (+0.7%). In a context of a rise in interest rates, the Company continues to benefit from the renegotiations carried out in the past years, as well as from the hedging of its debt portfolio. The average interest rate on debt is 2.07% for the 12 months ending December 31, 2022 (versus 2.04% in 2021), while 79% of the debt is either at fixed rate or at hedged variable rate.
Recurring net result (FFO) amounted to € 29.3m in 2022, compared to € 26.7m in 2021:
The external appraisal valuation campaign resulted in a fair value adjustment of +€ 14.9m in 2022, reflecting the resilience of the portfolio in a context of high inflation and of sharp rise in interest rates.
Including the share of the result of companies accounted for using the equity method (+€ 0.5m), other non-recurring revenues and charges (-€ 1.4m), and the contribution of hedging strategies on debt (+€ 2.8m), net profit amounted to € 46.1m for the fiscal year 2022 and € 47.8m in group share, increasing by +51.7% compared to last year.
Decrease of the LTV ratio and increase of the NAV per share at € 28.5 (+6.8%) The Group consolidated net debt of € 360.9m as of December 31, 2022, implies a Loan-to-Value ratio of 44.0%, leaving a significant investment capacity compared to the target of 50% set by Patrimoine & Commerce.
Net asset value per share amounted to € 28.48 (€ 431.2m) in 2022, an increase of +6.8% versus 2021.
Development and optimization of the portfolio As of December 31, 2022, the portfolio valuation (excluding transfer taxes and including properties accounted for using the equity method), reached € 841.3m, increasing by +4.3% compared to 2021. The capitalization rate of the properties in operation stands at 7.0%.
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