SFL – First-Half 2018 Results
Société Foncière Lyonnaise (Paris:FLY):
Rental income: €96.1 million (up 4.9% like-for-like)
EPRA earnings: €51.7 million (up 4.1%)
Attributable net profit: €200.2 million
Property portfolio value: €6,409 million (up 2.9%)
EPRA NNNAV: €82.3 per share (up 2.7% over 6 months / 12.0% over 1 year)
The interim consolidated financial statements for the six months ended 30 June 2018 were approved by the Board of Directors of Société Foncière Lyonnaise on 26 July 2018, at its meeting chaired by Juan José Brugera.
Business indicators were once again robust in the first half thanks to the high portfolio occupancy rate, while the period also saw further gains in the portfolio's appraisal value and the Company's net asset value.
The auditors have completed their review of the financial statements and issued their report on the interim financial information, which does not contain any qualifications or emphasis of matter.
|Consolidated data (€ millions)|
|H1 2018||H1 2017||Change|
|Adjusted operating profit*||78.7||82.5||-4.6%|
|Attributable net profit||200.2||378.7||-|
|* Operating profit before disposal gains and losses and fair value adjustments|
|Consolidated portfolio value excluding transfer costs||6,409||6,229||+2.9%|
|Consolidated portfolio value including transfer costs||6,811||6,619||+2.9%|
|EPRA NNNAV per share||€82.3||€80.1|
Results: robust business indicators
First-half consolidated rental income amounted to €96.1 million, down
by a modest €2.6 million or 2.6% from the €98.6 million reported for
the same period of 2017. Like-for-like growth went a long way towards
offsetting the impact of selling the IN/OUT property in September 2017.
- On a like-for-like basis (excluding all changes in the portfolio affecting period-on-period comparisons), rental income was €4.2 million (4.9%) higher, reflecting the impact of new leases signed in the second half of 2017 and the first half of 2018, mainly in the Washington Plaza, 103 Grenelle, Cézanne Saint-Honoré and 9 Percier properties, as well as an increase in rents for Galerie des Champs-Elysées retail units.
- The sale of the IN/OUT building on 29 September 2017 led to a €6.5 million decrease in rental income compared to first-half 2017.
- Lastly, income from assets under redevelopment and various penalties dipped by €0.3 million versus first-half 2017.
- Operating profit before disposal gains and losses and fair value adjustments to investment property amounted to €78.7 million in first-half 2018 versus €82.5 million in the year-earlier period.
- The portfolio’s appraisal value at 30 June 2018 was 2.9% higher on a like-for-like basis than at 31 December 2017. The increase led to the recognition of positive fair value adjustments to investment property of €159.2 million at 30 June 2018 versus positive adjustments of €382.6 million at 30 June 2017.
- Net finance costs amounted to €16.5 million in first-half 2018 compared with €21.2 million in the year-earlier period. The period-on-period decrease of €4.6 million reflected the Group's lower average cost of debt and reduced debt burden, which led to a €6.2 million reduction in recurring financial expense.
- After taking into account these core items, the Group reported attributable net profit for the period of €200.2 million, compared with €378.7 million in first-half 2017. EPRA earnings came to €51.7 million in first-half 2018 compared with €49.7 million in the year-earlier period, an increase of 4.1%.
First-half 2018 Business Review
In a still favourable rental market in the Paris region, shaped by increased volumes compared to 2017 and higher rents, particularly in the capital’s Central Business District, during the first half of 2018 SFL signed leases on around 8,500 sq.m., located mainly in the Washington Plaza, Cézanne Saint-Honoré and Louvre Saint-Honoré complexes.
The new leases were signed at an average nominal rent of €686 per sq.m, corresponding to an effective rent of €603 per sq.m.
The physical occupancy rate for revenue-generating properties remained high, standing at 96.5% at 30 June 2018 compared with 96.4% at 31 December 2017. The remaining vacant units are located mainly in the Cézanne Saint-Honoré complex in Paris and the Le Vaisseau building in Issy-les-Moulineaux. The EPRA vacancy rate improved to 2.7% from 3.1% at 31 December 2017.
Properties undergoing development at 30 June 2018 represented roughly 15% of the total portfolio. They consist mainly of three flagship projects being implemented over the next four years, concerning:
- the retail space in the Louvre Saint-Honoré complex,
- the Emile Zola office complex acquired in 2017, which will be extensively remodelled based on the building permit obtained in May 2018,
- the 96 Iéna building, for which the planning appeal process has now ended, allowing renovation work to begin next January.
Capitalized work carried out in first-half 2018 totalled €13.6 million and concerned the above three redevelopment projects, as well as work to improve common areas and the services offered by the Group’s properties in response to the new needs expressed by tenants and users on the back of emerging office use practices.
No properties were purchased or sold during first-half 2018.
In May 2018, SFL issued €500 million worth of seven-year bonds maturing on 29 May 2025 and paying an annual coupon of 1.50% (see press release dated 17 May 2018). The proceeds will be used for general corporate purposes. The issue, at a historically low interest rate, extends the average maturity of the Group’s debt, as part of its proactive balance sheet management strategy.
Net debt at 30 June 2018 amounted to €1,699 million, compared with €1,631 million at 31 December 2017, representing a loan-to-value ratio of 24.9%. At 30 June 2018, the average cost of debt after hedging was 1.8% and the average maturity was 4.8 years.
At the same date, SFL had €820 million in undrawn lines of credit.
Net Asset Value
The consolidated market value of the portfolio rose by 2.9% to €6,409 million excluding transfer costs at 30 June 2018, from €6,229 million at 31 December 2017. The increase reflected higher rental values, resilient prime property yields in Paris and the value added by the Group to properties undergoing redevelopment.
The average EPRA topped-up net initial yield (NIY) was 3.2% at 30 June 2018, unchanged from 31 December 2017.
EPRA NNNAV stood at €3,830 million or €82.3 per share at 30 June 2018 versus €80.1 per share at 31 December 2017, reflecting increases of 2.7% over the past six months and 12.0% over twelve months.
Board of Directors
The Board of Directors noted Anne-Marie de Chalambert’s decision to resign from her position as a director and extended its warmest thanks to her for her valuable contribution to the Board’s work since she was first elected in 2010.
During the same meeting, the Board appointed Arielle Malard de Rothschild as an independent director, subject to ratification at the Company's next General Meeting.
Alternative Performance Indicators (APIs)
API EPRA earnings:
|€ millions||H1 2018||H1 2017|
|Attributable net profit||200.2||378.7|
|Profit (loss) on asset disposals||-||-|
|Fair value adjustments to investment property||(159.2)||(382.6)|
|Fair value adjustments to financial instruments, discounting adjustments to debt and related costs||1.5||0.0|
|Tax on the above items||2.0||20.1|
|Non-controlling interests in the above items||7.2||33.5|
API EPRA NNNAV:
|Unrealised capital gains||20||17|
|Fair value adjustments to fixed rate debt||(57)||(62)|
API Net debt:
|Long-term borrowings and derivative instruments||1,798||1,661|
|Short-term borrowings and other interest-bearing debt||13||36|
|Debt in the consolidated statement of financial position||1,811||1,697|
|Current account advances (liabilities)||(56)||(56)|
|Accrued interest, deferred recognition of debt arranging fees, negative fair value adjustments to financial instruments||(2)||6|
|Cash and cash equivalents||(54)||(16)|
More information is available at www.fonciere-lyonnaise.com
Leader in the prime segment of the Parisian commercial real estate market, Société Foncière Lyonnaise stands out for the quality of its property portfolio, which is valued at €6.4 billion and is focused on the Central Business District of Paris (#cloud.paris, Edouard VII, Washington Plaza, etc.), and for the quality of its client portfolio, which is composed of prestigious companies in the consulting, media, digital, luxury, finance and insurance sectors. As France’s oldest property company, SFL demonstrates year after year an unwavering commitment to its strategy focused on creating a high value in use for users and, ultimately, substantial appraisal values for its properties.
Stock market: Euronext Paris Compartment A – Euronext Paris ISIN FR0000033409 – Bloomberg: FLY FP – Reuters: FLYP PA
S&P rating: BBB+ stable outlook
Om Business Wire
(c) 2018 Business Wire, Inc., All rights reserved.
Business Wire, a Berkshire Hathaway company, is the global leader in multiplatform press release distribution.
Følg saker fra Business Wire
Registrer deg med din epostadresse under for å få de nyeste sakene fra Business Wire på epost fortløpende. Du kan melde deg av når som helst.
Siste saker fra Business Wire
Tinubu Square Appoints Sophie Riottot as Group Sales Director19.6.2019 17:02:00 CEST | Pressemelding
Tinubu Square, a leading provider of credit insurance, surety and trade finance solutions, has announced the appointment of Sophie Riottot as Group Sales Director. This is a strategic engagement for the company, which is restructuring its sales approach to reinforce its rapid global growth. This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20190619005634/en/ Sophie Riottot, new Group Sales Director at Tinubu Square (Photo: Business Wire) Sophie Riottot brings a wealth of experience to Tinubu Square. She joins the company from Dhatim, a French start-up specializing in AI-powered invoice services, where she was responsible for sales strategy and partnership development. Prior to this, she was with Microsoft for over 17 years, in a variety of prominent sales and management positions, including Head of Finance in the Services Division. As a member of the executive committee at Tinubu Square, Sophie will be responsible for spearheadin
ExaGrid Voted “Enterprise Backup Hardware Product of the Year”19.6.2019 17:00:00 CEST | Pressemelding
ExaGrid®, a leading provider of intelligent hyperconverged storage for backup, today announced that it has been voted Storage Magazine’s “Enterprise Backup Hardware Product of the Year” at its annual awards ceremony Storries XVI. Winners are determined by public vote, so receipt of this award is especially important; it heralds the collective voices of ExaGrid’s customers and partners, and further validates the excellence of ExaGrid’s differentiated product architecture and superior customer support model. “We’re honored to accept this award from Storage Magazine,” said Bill Andrews, President and CEO of ExaGrid. “ExaGrid’s deduplication and its scale-out architecture provides customers with a consistent backup window regardless of data growth, which is especially important in today’s ever-changing enterprise environments. The scale-out approach also eliminates forklift upgrades and forced product obsolescence. Our unique Landing Zone retains the most recent backup in its full undedupl
Luxury Pre-War Elevator Building in Prestigious Brooklyn Heights Offered for Sale19.6.2019 16:12:00 CEST | Pressemelding
Holliday Fenoglio Fowler, L.P. (HFF) announces it has been selected to exclusively market the sale of 25 Monroe Place, a 12-story, 67-unit, luxury apartment building located in the Brooklyn Heights neighborhood of Brooklyn, New York. This offering provides a rare opportunity to acquire a trophy asset in the most sought-after neighborhood in Brooklyn. The vast majority of the property is comprised of fair-market units not subject to rent stabilization. 25 Monroe Place is situated in the Brooklyn Heights historic district, which provides immediate access to Manhattan, the Brooklyn Waterfront, Brooklyn Bridge Park, Downtown Brooklyn and DUMBO. Brooklyn Heights is characterized by charming brownstones and plush tree-lined streets, and the property is surrounded by medium- and low-density buildings that provide water and Manhattan skyline views. Built in 1938, 25 Monroe Place combines pre-war architectural elements and spacious apartment layouts with newly upgraded condo-quality finishes, i
Shopify Unveils New Innovations to Transform Commerce for Merchants and Consumers Globally19.6.2019 15:30:00 CEST | Pressemelding
Today, Shopify Inc. (NYSE:SHOP) (TSX:SHOP), the leading multi-channel commerce platform, unveiled the latest in commerce technology at Shopify Unite, the annual conference that brings together the company’s global partner and developer community. This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20190619005550/en/ Shopify Fulfillment Network (Graphic: Business Wire) “Shopify’s real power comes from the variety and strength of our ecosystem,” said Shopify CEO Tobi Lutke. "Unite gives our developer and partner community access to our product roadmap. Together, and only together, we can shape the future of commerce and empower entrepreneurs around the world.” This year, Shopify is transforming commerce by announcing platform enhancements and updates focused on giving direct-to-consumer brands everything they need to build and manage a business. Shopify’s innovations include a newly updated Shopify Plus platform for enterprise brands
Geri Horner Test Drives RockStar Suites aboard Virgin Voyages’ Scarlet Lady19.6.2019 14:01:00 CEST | Pressemelding
Virgin Voyages is upping the game for its top suites aboard the highly anticipated Scarlet Lady, with new offerings to ensure that Mega RockStars won’t have to worry about a thing during their voyage. This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20190619005107/en/ Geri Horner of the Spice Girls testing out Virgin Voyages Mega Rockstar Suites in New Video (Photo: Business Wire) Geri Horner Test Drives RockStar Suites In celebration of the expanded offerings, the brand has today released exclusive video content of the suites, which features Virgin Group founder, Sir Richard Branson, and legendary British pop star, Geri Horner, of the hugely successful girl group, the Spice Girls. The video documents Horner test driving the Virgin Voyages ‘Gorgeous Suite,’ one of the ship’s most glamorous cabins, as a favor to her longtime friend, Branson. Following Horner’s journey through the suite, the footage chronicles her full RockStar ex
Survey of SAP Licensees Reveals Two-Thirds Have No Plans or Are Undecided About Migrating to New S/4HANA Product19.6.2019 13:00:00 CEST | Pressemelding
Rimini Street, Inc. (Nasdaq: RMNI), a global provider of enterprise software products and services, the leading third-party support provider for Oracle and SAP software products and a Salesforce partner, today revealed the findings from its recent survey of SAP licensees conducted to better understand their plans for S/4HANA and the impact of SAP’s planned 2025 end of mainstream maintenance support for Business Suite 7 core applications on their IT roadmap plans. Of the IT leaders surveyed who are currently running SAP’s Business Suite 7 or older releases, two-thirds state they either have no plans to migrate to S/4HANA (35%) or are undecided about moving to S/4HANA (32%). The top reasons cited include “lack of resources,” “no business justification,” and a preference to “maximize investment in current applications.” The number of respondents who stated they have no plans to migrate or are undecided has risen slightly from a previous survey in 2017 – at that time 65% of IT leaders stat