PRESS RELEASE

from PATRIMOINE ET COMMERCE (EPA:PAT)

PATRIMOINE ET COMMERCE: 2022 ANNUAL RESULTS

PATRIMOINE ET COMMERCE
PATRIMOINE ET COMMERCE: 2022 ANNUAL RESULTS

22-Feb-2023 / 07:00 CET/CEST
Dissemination of a French Regulatory News, transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.


 

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.

 

  • Group share of net profit increasing by +51.7% at € 47.8m
  • Collection rate at 98.1% on rents and service charges
  • Portfolio valuation of € 841m
  • Dividend payment of € 1.30 per share, +4.0% vs. last year, implying a 7.9% yield on share price, as well as a 4.6% yield on NAV

 

Key figures

 

Key financials

31/12/2022
12 months

31/12/2021
12 months

Var. %

Gross Rental Income

€ 47.3m

€ 43.7m

+8.3%

Funds from operations

€ 29.3m

€ 26.7m

+9.6%

Group share of net profit

€ 47.8m

€ 31.5m

+51.7%

 

 

 

 

Alternative Performance Measures

31/12/2022

31/12/2021

Var. %

Asset appraisal value (excluding transfer taxes) (2)

€ 841.3m

€ 807.0m

+4.3%

Capitalization rate (3)

7.0%

7.2%

n.a.

LTV ratio (4)

44.0%

45.2%

n.a.

NAV (excluding transfer taxes - €/share)

28.5 €

26.7 €

+6.8%

NAV (excluding transfer taxes)

€ 431.2m

€ 400.2m

+7.8%

 

 

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:

 

in millions of euros - 12 months

31/12/2022

31/12/2021

Var. %

Like-for-like

41.6

39.9

+4.3%

Acquisitions

3.9

0.4

n.a

Disposals

1.3

3.5

n.a

Properties under restructuring

0.5

-

n.a

Gross rental income

47.3

43.7

+8.3%

 

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:

 

in millions of euros - 12 months

31/12/2022

31/12/2021

Var. %

Gross rental income *

47.3

43.7

+8.3%

Entry fees

0.0

0.2

n.a.

Gross rental revenue

47.4

43.9

+7.8%

Unrecovered rental expenses

(2.7)

(2.4)

+9.8%

Other building expenses

(0.6)

(0.7)

n.a.

Net rental income

44.2

40.8

+8.3%

*  incl. rental guarantees

 

 

 

 

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:

in millions of euros - 12 months

31/12/2022

31/12/2021

Var. %

Restated current operational result

39.2

36.3

+7.9%

Restated net cost of debt

(9.5)

(9.4)

+0.7%

Current taxes

(0.4)

(0.2)

n.a.

Funds from operations (FFO) (6)

29.3

26.7

+9.6%

Diluted FFO per share

1.93

1.78

+8.6%

 

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.

 

in millions of euros - 12 months

31/12/2022

31/12/2021

Net Debt

360.9

359.2

(-) other lease liabilities

(0.6)

(0.6)

(+) deposits on real estate projects

0,0

(0.3)

(-) financial instruments

2.2

(1.3)

Restated Net debt

362.4

357.1

Property valuation (excl. Transfer taxes)

823.9

789.9

Loan To Value ratio

44.0%

45.2%

 

 

Net asset value per share amounted to € 28.48 (€ 431.2m) in 2022, an increase of +6.8% versus 2021.

 

in millions of euros

31/12/2022

31/12/2021

NAV, excl. Transfer taxes

431.2

400.2

NAV per share, excl. Transfer taxes (in euros)

28.48

26.67

Number of shares (excl. Treasury shares)

15 144 241

15 006 681

 

 

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%.

 

 

 

in millions of euros

Variation

Net balance as of January 1, 2022

807.0

Acquisitions

61.8

Disposals

(42.5)

Fair value impact

15.1

Net balance as of December 31, 2022

841.3

 

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