EQS-News: CPI PROPERTY GROUP publishes financial results for the first half of 2024

CPI Property Group
(société anonyme)
40, rue de la Vallée
L-2661 Luxembourg
R.C.S. Luxembourg: B 102 254

Press Release - Corporate News

Luxembourg, 30 August 2024

CPI PROPERTY GROUP publishes financial results for the first half of 2024

CPI PROPERTY GROUP (“CPIPG” or the “Group”), a leading European landlord, hereby publishes unaudited financial results for the six-month period ended 30 June 2024.

“CPIPG’s consistent growth in rental income demonstrates once again the benefits of our diversified, resilient and high-quality portfolio,” said David Greenbaum, CEO. “Further reducing leverage and complexity remain our key priorities.”

Highlights for the first half of 2024 include:

• Total assets were €21.2 billion, and EPRA NRV was €6.8 billion.
• CPIPG’s property portfolio was €18.6 billion (versus €19.5 billion at year-end 2023) reflecting disposals, a modest decline in valuations (-0.8%) and FX movements, partially offset by CapEx investments.
• The Group closed €980 million of disposals year-to-date. Nearly €400 million of signed disposals are expected to close in the next 2-3 months.
• Net rental income increased by 5.0% to €418 million despite disposals driven by like-for-like rental growth of 4.4%. Net business income rose to €443 million.
• Consolidated adjusted EBITDA was €395 million; FFO1 was €200 million.
• Occupancy remained solid at 91.3% with a stable WAULT of 3.4 years.
• The EPRA topped-up net initial yield increased by 0.3% versus year-end to 5.7%.
• In May 2024, CPIPG issued a €500 million 5-year green bond, with proceeds used to fully repay our remaining bridge facility.
• Net LTV decreased to 50%, down 2.3 p.p. from year-end 2023. Net Debt was reduced by more than €900 million compared to year-end.
• Net debt/EBITDA declined by 1.3x to 11.8x on an annualised basis versus year-end.
• Unencumbered assets stood at 49%, and net ICR increased slightly to 2.6x.
• In June 2024, the Group completed a minority equity investment in part of our portfolio in Poland from Sona Asset Management (UK) LPP for €250 million.
• Total available liquidity was €1.7 billion at the end of H1 2024, covering bond maturities over the next two years.

Completion of independent review of short seller allegations

Earlier today, CPIPG published an update for our stakeholders regarding the completion of an independent review by Global Law firm White & Case relating to the allegations raised by a short seller.

The investigation found no evidence to substantiate the short seller’s claims.

The separate press release and further information can be found here.

Other selected events occurring post-H1

On 12 July, S IMMO completed the sale of the HOTO Business Tower in Zagreb.

On 20 August, IMMOFINANZ sold the myhive Victorei office development in the old town of Bucharest for approximately €27 million.

Half-year results webcast

CPIPG will host a webcast in relation to its financial results for the six-month period ending 30 June 2024. The webcast will be held on Thursday, 5 September 2024, at 11:00 am CET / 10:00 am UK.

Please register for the webcast in advance via the link below:

https://edge.media-server.com/mmc/p/5vj8vceb

FINANCIAL HIGHLIGHTS

^[1] Due to the sale of a 50% stake in CPI Hotels, the hotel operating entity, income due from most hotel properties have been reclassified as rental income, as opposed to hotel income previously. Thus, the current hotel income figures are not comparable on a like-for-like basis to last year’s figures.
 

CONSOLIDATED INCOME STATEMENT

Gross rental income

Gross rental income increased by €14.5 million (3.17%) to €472 million in Q2 2024 compared to Q2 2023. The change was driven by reclassification of hotels from PPE to Investment property (and related revenue from hotels revenue to gross rental income) of €5.1 million and Inflation indexation of rental income by the Group.

Administrative expenses

Administrative expenses increased by €3.8 million in Q2 2024 compared to Q2 2023, primarily due to increase of overall advisory costs.

Net valuation loss

Net valuation loss of €153.7 million in Q2 2024 was represented primarily by revaluation loss generated by S IMMO (€84.2 million), Immofinanz (€28.4 million) and selected office portfolio in Prague.

Interest expense

Net interest expense increased by €4.0. million in Q2 2024 compared to Q2 2023, mainly due to an overall increase in the cost of financing. IMMOFINANZ and S IMMO net interest expense increased by €4.6 million and €6.5 million, respectively.

Net hotel income

Net hotel income decreased by €11.5 million due to disposal of part of the Group´s hotels portfolio in March 2024.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

Total assets

Total assets decreased by €699 million (3.2%) to €21,231.3 million as at 30 June 2024 compared to 31 December 2023. The decrease relates primarily to disposals of investment property (€692.7 million including €281.6 million of investment property classified as asset held for sale as at 31 December 2023).

Total liabilities

Total liabilities decreased by €874 million (6.4%) to €12,799 million as at 30 June 2024 compared to 31 December 2023, primarily due to a decrease in financial debts (€ 1,103.2 million).

Equity and EPRA NRV

Total equity increased by €175.0 million from €8,257.3 million as at 31 December 2023 to €8,432.3 million as at 30 June 2024. The movements of equity components were as follows:                   

• Decrease of translation reserve by €52.4 million, of revaluation reserve by €23.6 million, and of hedging reserve by € 14.3 million;
• Decrease of retained earnings by €111.8 million;
• Increase in perpetual notes by €38.2 million.
• Increase in non-controlling interests of €332.2 million.      

EPRA NRV was €5,372 million as at 30 June 2024, representing a decrease of 3.5% compared to 31 December 2023. The decrease of EPRA NRV was driven by the above changes in the Group’s equity attributable to the owners, primarily a decrease of retained earnings and a decrease of translation, revaluation and hedging reserve.

For disclosures regarding Alternative Performance Measures used in this press release please refer to our Half-year

Management Report 2024, chapters Glossary of terms, Key ratio reconciliations and EPRA performance; accessible at

http://cpipg.com/reports-presentations-en.

Unaudited documents will be available tonight at the following link:

http://www.cpipg.com/reports-presentations-en

Half-year 2024 unaudited financial statements
Half-year 2024 unaudited management report

For further information please contact:

Investor Relations

Moritz Mayer
Manager, Capital Markets
m.mayer@cpipg.com

For more on CPI Property Group, visit our website: www.cpipg.com