Grand City Properties S.A., / Key word(s): Half Year Results/Interim Report
Grand City Properties S.A.: Strong growth and profitability in H1 2013
The company's profitability is reflected in a EUR 58 million net profit in H1 2013 higher by 59% in comparison to EUR 36 million in H1 2012.
GCP proved its continuing strong performance with reported EBITDA of EUR 69.2 million, 27% higher than in the comparable period (H1 2012 EUR 54.5 million).
H1 2013 revenue increased to EUR 33.4 million (H1 2012 EUR 18.3 million, 83% YOY increase) due to rental income from newly acquired assets and increase in occupancy and rent.
Funds from Operations (FFO) have been boosted by 125% to EUR 8.1 million in the period compared with EUR 3.6 million at H1 2012.
FFO proforma amounts to EUR 14.3 million, assuming full operation of the entire GCP portfolio as of the beginning of the year and neutralizing the interest of the converted bond to date. This exhibits the strong operational performance of the current portfolio.
Net Assets Value (EPRA NAV) amounted to EUR 448 million at the end of June 2013, reflecting an increase of 32% since the end of December 2012 (EUR 339 million).
GCP's capital structure with an LTV of 43.9% demonstrates the conservative approach on financial leverage. The debt schedule has maturities ranging from 4 to 10 years with no material maturities until 2017. Average maturity is approximately 6 years.
The high liquidity of EUR 136 million provides GCP with sufficiently equipped liquidity for future growth and enables the company to receive attractive opportunities and accomplish its goals.
The company follows primarily a buy and hold strategy. Efficient management tools enable fast turnaround in the assets. The company increases the value of the objects through targeted modernization and runs an intensive tenant management. In H1 2013, the company continued its acquisition plan and purchased 4,400 units primarily in Berlin, Nuremberg, Mannheim, Essen and Dresden. The takeover of these units took place in July 2013 and will predominantly impact the performance in the second half of 2013. The company's portfolio currently comprises over 16,000 units with lettable space in excess of 1.1 million square meters.
An additional achievement of GCP has been the successful placement of a straight bond in 2013. The issuance was set in two tranches of which the first tranche was issued in June 2013 to the amount of EUR 100 million through a private placement, and the second tranche of additional EUR 100 million was issued in July 2013 in a public offering. The bonds are traded at the Frankfurt Stock Exchange. The bonds received the same S&P rating of BB- as the company rating.
The convertible bond issued in October 2012 is mostly converted into equity, reflecting the investors' expectations of the company's continuing success. As of June 30, 2013 more than 57% and as of the date of this report 84% of the bond was converted into equity.
Furthermore, GCP received in February 2013 proceeds of EUR 35.7 million from additional capital increase as part of an international private placement to institutional investors.
The half-year report 2013 of Grand City Properties S.A. is available on the company website at http://www.grandcityproperties.com/en/downloads.
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