Paris,
Amsterdam, July 27, 2023
Press release
UNIBAIL-RODAMCO-WESTFIELD
REPORTS
H1-2023
EARNINGS
H1-2023
AREPS up
+6.6%
year-on-year driven by
Shopping Centres and Offices
performance and
reduced general and
financial expenses
Operational performance and
further debt
reduction leading to
improved Net
debt to
EBITDA at
9.4x
Successful exchange offer of the
PERP-NC23 hybrid, a first of its kind by a corporate issuer, with a
92% participation rate, confirming debt market
confidence
Westfield Rise,
URW’s retail
media agency
in Europe drives new
revenue growth with +14% in net
margin vs. H1-2022
H1-2023
in review:
- Shopping Centre Net Rental Income
at €1,059 Mn up +8.5%1 on a like-for-like basis, including +4.5% of
indexation impact
- Tenant sales up +9% and footfall up
+7% vs. H1-2022
- High rent collection at 96%
- Shopping Centre occupancy improved
by 20 bps vs. FY-2022 with vacancy at 6.3%
- €219 Mn of Minimum Guaranteed Rent
(MGR) signed (+11% vs. H1-2022), with an uplift of +12.5% on
top of indexed passing rents, including +17.6% on long-term
deals
- Offices & Others Net Rental
Income of €41 Mn, up +17.1% on a like-for-like basis, driven by
leasing progress of Trinity at prime rent level for La Défense
market
- EBITDA at €1,157 Mn, back to
pre-COVID levels on a like-for-like basis
- Further asset disposals2 secured in
the US and Europe increasing the total IFRS net debt reduction
since 2021 to €4.7 Bn at Group level (from €4.2 Bn), with ongoing
active discussions in Europe and on US Regional assets
- H1-2023 IFRS Net Financial Debt
reduced to €20.5 Bn with reduced cost of debt at 1.8%
- More than 36 months of liquidity
secured with €11.9 Bn3, including €3.8 Bn of cash on hand
- 2023 AREPS at the upper end of
full-year guidance of €9.30 to €9.50, reflecting strong underlying
operational performance
Commenting on the results, Jean-Marie
Tritant, Chief Executive
Officer, said:
“URW delivered very solid financial results in
H1-2023 that demonstrate the strength of our assets and the quality
of our operations and teams.
During the half, we signed a record number of leases with
an increasing proportion of long-term deals and saw a 12.5% uplift
in rents.
Our sales continue to outperform the market
thanks to the location of our assets, the quality of our customer
base and our diversified retail mix.
We are excited by the success of Westfield Rise,
our European retail media agency, which saw a +14% increase in net
margin, driven by increased footfall and higher average revenue per
visit.
Our successful hybrid exchange offer, accepted
by over 90% of holders, confirms the confidence of the debt market
in URW as does the confirmation of our credit ratings by S&P
and Moody’s.
We also made further deleveraging progress in
2023 in a constrained investment market, securing a €0.5 Bn
contribution to IFRS net debt reduction taking the total amount
since 2021 to €4.7 Bn.
Our performance in the first half builds on the
strong platform we established in 2022, and we are confident this
momentum will continue throughout 2023 and our AREPS will be at the
upper end of our full-year guidance.”
|
H1-2023 |
H1-2022 |
Growth |
Like-for-like growth4 |
Net Rental Income (in € Mn) |
1,152 |
1,139 |
+1.1% |
+8.2%5 |
Shopping Centres |
1,059 |
1,036 |
+2.2% |
+8.5%6 |
Offices & Others |
41 |
36 |
+15.6% |
+17.1% |
Convention & Exhibition |
52 |
68 |
-23.0% |
n.m. |
|
|
|
|
|
EBITDA (in € Mn) |
1,157 |
1,139 |
+1.6% |
|
Recurring net result (in € Mn) |
757 |
711 |
+6.5% |
|
Recurring EPS (in €) |
5.45 |
5.12 |
+6.3% |
|
Adjusted Recurring EPS (in €) |
5.28 |
4.95 |
+6.6% |
|
|
|
|
|
|
|
June
30,
2023 |
Dec. 31,
2022 |
Growth |
Like-for-like growth |
Proportionate portfolio valuation
(in € Mn) |
51,029 |
52,250 |
-2.3% |
-2.2% |
EPRA Net Reinstatement Value (in € per
stapled share) |
150.70 |
155.70 |
-3.2% |
|
Figures may not add up due to rounding
H1-2023
AREPS:
€5.28
Reported AREPS amounted to €5.28, up +6.6%
compared to H1-2022, mainly driven by the strong operational
performance in retail and offices, and supported by reduced general
and financial expenses. AREPS was partly offset by disposals and
lower C&E activity due to seasonality effects.
OPERATING PERFORMANCE
Shopping
Centres
Like-for-like shopping centre
NRI6 was up by +8.5% for the
Group, and by +12.5% in Continental Europe, +9.4% in the UK and up
+1.4% for US Flagships. US Regional and CBD assets were down
-9.8%7. This overall increase is mainly due to the positive impact
of indexation in Continental Europe (+6.7%) where all rents are
indexed on a yearly basis, positive leasing activity contribution
and higher variable income.
H1-2023 tenant
sales8 were up +9.2% compared to
H1-2022, including +11.8% in Continental Europe, +6.8% in the UK
and +4.6% in the US9. Sales continued to outperform footfall,
reflecting the productive nature of visitors to URW’s centres.
Footfall10 was
up +7.3%, including +8.2% in Continental Europe, +9.2% in the UK
and +2.7% in the US9.
In H1-2023, European tenant sales were up +10.9%
compared to H1-2022, above core inflation of 5.7% and national
sales indices of 2.6%11, demonstrating that URW centres continue to
gain market share. H1-2023 saw a strong increase in the performance
of social and experience-led activities, with Fitness-related
tenant sales up +35.7%, Entertainment up +22.4% and F&B up
+17.1%, while Health & Beauty and Fashion continued to perform
strongly, up +17.7% and +9.7% respectively.
In the US, Flagships tenant sales12 were up
+4.6% in H1-2023, performing above the US National Sales index,
which was up 4.3%11. As in Europe, US Flagships growth was also
driven by the performance of experience-led sectors, including
Entertainment (+91.4% vs. H1-2022), F&B (+20.6%), Fitness
(+10.9%) and Health & Beauty (+9.0%). Fashion sales decreased
slightly by -2.0% and Luxury by -6.8% but both remained above 2019
levels (+14.0% and +87.9% respectively).
Rent
collection13 amounted to 96% for H1-2023 (vs. 96% and 95%
initially reported in H1-2022 and in Q1-2023 respectively), both in
Europe and in the US. Net of bankruptcies, H1-2023 rent collection
stands at 97% in Europe and for the Group. URW continued to collect
2022 rents, leading to an improvement of 2022 rent collection from
97% to 98% between FY-2022 and H1-2023.
Bankruptcies increased in
H1-2023 to 211 stores returning to a normalised level as government
support and rent relief provided during the COVID period came to an
end. More than a quarter of stores affected were in France. 84% of
units affected saw their tenant still in place and 5% were relet,
limiting the impact of bankruptcies on H1-2023 vacancy.
In terms of leasing activity,
the Group signed 1,180 leases for €219 Mn of MGR14 (+11% compared
to H1-2022) during H1-2023 with an MGR uplift of +12.5% (vs. +2.6%
in H1-2022) reflecting the effectiveness of the Group’s leasing
strategy and the strong appeal for URW assets. The proportion of
long-term deals signed also increased from 74% of MGR signed in
H1-2022 to 78% in H1-2023. The MGR uplift for leases longer than 36
months came to +17.6% for the Group, on top of indexed passing
rents, with Continental Europe at +6.5%, the UK at +20.1% and the
US at +38.8%.
On a like-for-like basis, Sales Based
Rents
(SBR)15
increased in total by +8.5% in H1-2023 vs. H1-2022 thanks to strong
retailers’ sales performance including inflation, with +€10.0 Mn in
Continental Europe, -€0.4 Mn in the UK and -€5.7 Mn in the US due
to high SBR settlement in H1-2022 and conversion of SBR to MGR in
the UK and in the US.
Vacancy for Shopping Centres at
Group level decreased to 6.3% at H1-2023, down from 6.5%
at FY-2022 and 6.9% at H1-2022, thanks to the Group’s
proactive leasing approach.
In Continental Europe, vacancy was at 3.6%,
below the 3.8% in Q1-2023 due to good leasing activity but up from
3.1% in December 2022. This was due to the normalised level of
bankruptcies, and to the expiry of short-term deals in Germany and
Austria which relied more on these deals during
COVID.
In the UK, vacancy decreased from 9.4% in
December 2022 to 8.5% in June 2023 thanks to strong leasing
activity.
In the US, vacancy reduced to 9.9% in June 2023
from 10.4% in December 2022, with vacancy decreasing by -30 bps to
7.9% for US Flagships, close to pre-COVID level of 2019 (7.7%).
Retail
Media &
other income
Revenue from Retail Media & other income16
increased from €50.4 Mn in H1-2022 to €55.6 Mn in H1-2023, driven
by the launch of Westfield Rise in Europe, an in-house media, brand
experience and data partnerships agency. Total Westfield Rise
activity in Europe amounted to €19.6 Mn in net margin at 100% in
H1-2023, up +14% compared to H1-2022.
Offices &
Others
Office NRI increased by +15.6% at Group level
(+17.1% on a like-for-like basis), driven by the leasing progress
at Trinity in La Défense and the delivery of Gaîté Montparnasse
offices, partly offset by 2022 and H1-2023 disposals, currency
effects and assets in pipeline.
Three new leases (Teamwill, IRI and Axway) were
signed for Trinity in H1-2023. Trinity is now 85% let, at an
average rent of c. €568/sqm, with lease incentives below the market
average. In addition, 1,400 sqm17 were leased at Westfield
Hamburg-Überseequartier offices, bringing the letting17 of the
office component to be delivered in 2024 to 34%.
Convention &
Exhibition
H1-2023 confirmed the strong recovery of the
C&E activity observed in 2022. During the period, Viparis
hosted 305 events compared to 272 events in H1-2022 and 386 events
in H1-2019.
Convention & Exhibition recurring NOI in the
first half amounted to €71.1 Mn compared to €94.5 Mn in H1-2022 and
€87.6 Mn in H1-2019, reflecting the change in seasonality
patterns for events organised following COVID disruption. Restated
from the French State contribution received in 2022 and from
triennial shows (held in 2018 and 2022), the NOI was up +5.2%
compared to H1-2022.
As at June 30, 2023, signed and pre-booked
events in Viparis venues for 2023 amounted to 95% of its expected
2023 rental income.
DISPOSALS
In 2023 year-to-date, the Group secured further
asset disposals in the US and Europe, reaching $1.6 Bn (€1.4 Bn) in
total proceeds in the US, and completing €3.3 Bn of its €4.0 Bn
European asset disposal programme, corresponding to total disposal
proceeds of €4.7 Bn since 2021.
In Europe, URW
completed the sale of the “V” office building located in
Versailles, France at €95 Mn, in line with the last unaffected
appraisal value, with a double-digit IRR and a net initial yield of
5.7%. On July 11, 2023, the Group signed an agreement for the sale
of Novotel Lyon Confluence in France.The Group is in active
discussions in relation to several European assets in a constrained
investment market.
In the US, the Group also
continued to streamline its US Regional portfolio. On February 1,
2023, the Group completed the sale of its ground lease for
Westfield North County located in Escondido, California, for $57 Mn
(at 100%, URW share 55%). On May 25, 2023, the Group announced the
sale of Westfield Brandon, located in Brandon, Florida for $220 Mn
(URW share 100%) reflecting a 10.0% net initial yield and a 4.4%
discount to the last unaffected appraisal.
Since the end of H1-2023, the Group has sold the
Westfield Mission Valley shopping centres in San Diego, California
for a sale price of $290 Mn (at 100%, URW share 42%). The
transaction value reflects a combined initial yield of 8.5% on the
in-place NOI and a 12% discount to the last unaffected
appraisal.
The Group has started the process which will
lead to the planned sale or foreclosure of 2 of its US assets,
respectively Westfield Valencia Town Center, with a debt amount of
$195 Mn at 100% ($97.5 Mn URW share) as at June 30, 2023, and
San Francisco Centre with a debt amount of $558 Mn at 100% ($340 Mn
URW share). The book value at URW share of these assets was close
to or below their debt amounts as at June 30, 2023 at respectively
$106 Mn and $301 Mn.
Including these disposals and planned
foreclosures, the total amount of net debt reduction stands at €0.5
Bn on an IFRS basis and €0.9 Bn on a proportionate basis.
The Group is highly focused on its deleveraging
plan, securing the remaining €0.7 Bn of its European disposal
programme by the end of the year and further streamlining of US
Regional portfolio. Once completed, it will pursue a disciplined
asset rotation policy.
The radical reduction of the Group’s US
financial exposure remains its path forward. URW’s operational
performance, in particular in the US, as well as its controlled
cost of debt, ample liquidity position and capex control give it
flexibility on when it executes this plan.
DELIVERIES &
PIPELINE
As a result of deliveries in H1-2023 and project
cost evolution on some of the committed projects, the Total
Investment Cost (TIC)18 of URW’s development pipeline remained
stable compared to December 31, 2022 at €3.1 Bn.
The Group delivered 2 projects in May 2023: a
19,360 sqm extension to Garbera shopping centre in San Sebastian,
Spain and the completion of Westfield Les 4 Temps renovation
project of the centre’s main plaza “La Clairière”.
Committed projects amount to €2.4 Bn, of which
€1.4 Bn has already been invested. The main projects are the mixed
used development in Hamburg (Westfield Hamburg-Überseequartier),
the office project of Lightwell in Paris La Défense, the
residential project of Coppermaker Square, and the Triangle project
in Paris.
In H2-2023, URW plans to deliver Coppermaker
Square Retail (a 7,437 sqm leisure development adjacent to
Westfield Stratford City), and the restructuring of the former El
Corte Inglés unit, located in the extension area of Westfield
Parquesur, with more than 14,954 sqm to extend Inditex brands. The
average pre-letting19 of these projects stands at 83%.
VALUATION
The proportionate Gross Market Value (GMV) of
the Group’s assets as at June 30, 2023, decreased by -2.3% to €51.0
Bn from €52.2 Bn as at December 31, 2022, mainly as a result of a
like-for-like portfolio revaluation of -€1,019 Mn and disposals
(-€343 Mn), partly offset by Capex, Acquisitions and Transfers
(+€574 Mn). Like-for-like shopping centres valuations were down
-1.9% for H1-2023 including a yield impact of -4.8% and a rent
impact of +2.9% as appraisers increased their assumption of
discount and exit cap rates.
The EPRA Net Reinstatement Value per share came
to €150.70 as at June 30, 2023, down from €155.70 (-3.2%) compared
to December 31, 2022, mainly driven by the revaluation of
investment properties, and partly offset by the retained recurring
results.
FINANCIAL RESOURCES
As at June 30, 2023, the Group’s IFRS net
financial debt decreased to €20.5 Bn from €20.7 Bn as at December
31, 2022.
The Loan-to-Value (LTV) ratio increased from
41.2% to 41.9% and 41.7% pro-forma for the receipt of the proceeds
from the additional disposals secured to date or planned
foreclosures20.
On a proportionate basis, the LTV would be
almost stable compared to FY-2022 at 43.0% pro-forma for the
secured disposals and planned foreclosures.
Net debt/EBITDA21 ratio decreased to 9.4x (vs.
9.6x in FY-2022), the Interest Coverage Ratio (ICR) increased
to 4.4x (vs. 4.2x in FY-2022), and Funds from Operations to Net
Financial Debt (FFO/NFD) ratio improved to 8.3% (vs. 7.6% in
FY-2022).
Over H1-2023, URW raised €653 Mn (€721 Mn on a
proportionate basis) of medium to long-term funds in the mortgage
and bank markets (including credit facility renewals), further
strengthening its liquidity position.
On June 26, 2023, the Group successfully
completed an any-and-all par-for-par Exchange Offer on its €1.25 Bn
hybrid Perp-NC23 notes (“Old Notes”) into a combination of (i) new
Euro denominated Perp-NC28 hybrid notes with a coupon of 7.25%
(“New Notes”) and (ii) a cash amount when applicable. The first of
its kind by a corporate issuer, the Exchange Offer had a
participation rate of 92%, corresponding to €1.15 Bn of Old Notes
exchanged on July 3, 2023 into €995 Mn New Notes and €155 Mn
of cash paid (the Cash Amount).
Accordingly, the Group’s overall hybrid
portfolio will decrease to €1,845 Mn (corresponding to a reduction
of 7.76%).
The Group’s liquidity position reached €11.9 Bn
(€12.0 Bn on a proportionate basis) including cash on
hand of €3.8 Bn (€4.0 Bn on a proportionate basis), allowing the
Group to fully secure its debt maturities for more than the next 36
months.
The Group’s average debt maturity22 stood at 8.0
years.
The Group’s average cost of debt decreased from
2.0% to 1.8%, representing a blended average cost of 1.3%
for Euro denominated debt and 3.9% for USD and GBP denominated
debt, as a result of improved cash remuneration on its increasing
cash position and a stable cost of gross debt thanks to hedges in
place.
ESG
URW is on track to meet its Better Places 2030
targets, including reducing carbon emissions across its value chain
by 50% between 2015 and 2030. The Group is committed to
contributing to global carbon neutrality and will present a
step-change update to its plan in H2-2023, with a view to
establishing new commitments.
In H1-2023, the Group pursued the implementation
of its renewable energy infrastructure strategy with the delivery
of photovoltaic plants at Centrum Cerny Most in Czech Republic. The
Group’s total installed capacity of on-site renewable energy stands
at 17 MW, well above the 2025 target set in 2016 of 6.9 MW.
In April 2023, the Group launched the first
edition of Westfield Good Festival throughout the 22 European
Westfield malls, enabling retailers to display their sustainability
initiatives and visitors to access information on sustainability
and circularity.
2023
GUIDANCE
In view of the H1-2023 strong operating
performance dynamic, the deleveraging progress in line with
guidance, the controlled cost of debt, the reduced general expenses
and the visibility on the terms of the hybrid, 2023 AREPS will be
at the upper end of the Group’s guidance23 of €9.30 to €9.50.
FINANCIAL SCHEDULE
The next financial events on the Group’s
calendar will be:October 10, 2023: Sustainability
Investor EventOctober 26,
2023: Q3 trading
updateFebruary 8,
2024: FY-2023
results
For further
information, please contact:
Investor Relations Meriem Delfi+33 7 63 45
59 77investor.relations@urw.com
Gonzague Montigny+33 6 10 95 85 84investor.relations@urw.com
Media Relations UK/Global:Cornelia Schnepf
– Finelk+44 7387 108 998Cornelia.Schnepf@finelk.eu
France:Sonia Fellmann – PLEAD +33 6 27 84 91
30Sonia.Fellmann@plead.fr
United States:Molly Morse – Kekst CNC+ 1 212 521
4826Molly.Morse@kekstcnc.com
About Unibail-Rodamco-Westfield
Unibail-Rodamco-Westfield is an owner, developer
and operator of sustainable, high-quality real estate assets in the
most dynamic cities in Europe and the United States.
The Group operates 75 shopping centres in 12
countries, including 39 which carry the iconic Westfield brand.
These centres attract over 900 million visits annually and provide
a unique platform for retailers and brands to connect with
consumers. URW also has a portfolio of high-quality offices, 10
convention and exhibition venues in Paris, and a €3 Bn development
pipeline of mainly mixed-use assets. Currently, its €51 Bn
portfolio is 87% in retail, 6% in offices, 5% in convention and
exhibition venues, and 2% in services (as at June 30, 2023).
URW is a committed partner to major cities on
urban regeneration projects, through both mixed-use development and
the retrofitting of buildings to industry-leading sustainability
standards. These commitments are enhanced by the Group’s Better
Places 2030 agenda, which strives to make a positive environmental,
social and economic impact on the cities and communities where URW
operates.
URW’s stapled shares are listed on Euronext
Paris (Ticker: URW), with a secondary listing in Australia through
Chess Depositary Interests. The Group benefits from a BBB+ rating
from Standard & Poor’s and from a Baa2 rating from Moody’s.
For more information, please visit
www.urw.com
1 Shopping Centres Lfl NRI excluding airports.2 Include
disposals completed or secured since January 2023 and planned
foreclosures.3 On an IFRS basis, including €8.0 Bn of undrawn
credit facilities.
4 Like-for-like NRI: Net Rental Income excluding
acquisitions, divestments, transfers to and from pipeline
(extensions, brownfields or redevelopment of an asset when
operations are stopped to enable works), all other changes
resulting in any change to square metres and currency exchange rate
differences in the periods analysed.5 Group Lfl NRI including
airports.6 Shopping Centres Lfl NRI excluding airports.7 Excluding
airports.
8 Tenant sales for all centres (except The
Netherlands) in operation, including extensions of existing assets,
but excluding deliveries of new brownfield projects, newly acquired
assets and assets under heavy refurbishment (Ursynów, Les Ateliers
Gaîté, CNIT, Gropius Passagen and Garbera) or works in the
surrounding area (Fisketorvet), excluding El Corte Inglés sales
from Westfield Parquesur and La Vaguada, excluding Zlote Tarasy as
this centre is not managed by URW, excluding Carrousel du Louvre
and excluding Auto category for Europe and Department Stores for
the US. In addition, sales have been restated from the disposals
which occurred during the semester.9 Flagships only.
10 Footfall for all centres in operation,
including extensions of existing assets, but excluding deliveries
of new brownfield projects, newly acquired assets and assets under
heavy refurbishment (Ursynów, Les Ateliers Gaîté, CNIT, Gropius
Passagen and Garbera) or works in the surrounding area
(Fisketorvet), excluding Carrousel du Louvre and excluding Zlote
Tarasy as this centre is not managed by URW, and excluding in the
US, the centres for which no comparable data of the previous year
is available. In addition, footfall has been restated from the
disposals which occurred during the semester. 11 As at May 2023,
for further details, please refer to the appendix to this Press
Release.12 US Regionals at +1.3%.13 Retail only, assets at 100%.
MGR + CAM in the US.14 All letting figures exclude deals <12
months. Usual 3/6/9 leases in France are included in the long-term
leases.15 Excluding airports.
16 Group figure (Europe and US) on a
proportionate basis. Retail Media & other income include both
the new Media, Brand & Data Partnerships division presented
during the Investor Day in March 2022 and now called “Westfield
Rise” in Europe, as well as kiosks, seasonal markets, pop-ups, and
car park activations (“other income”).17 In terms of GLA.
18 URW Total Investment Cost (TIC) equals 100%
TIC multiplied by URW's percentage stake in the project, adjusted
by specific own costs and income, if any. 100% TIC is expressed in
value at completion. It equals the sum of: (i) all capital
expenditures from the start of the project to the completion date
and includes: land costs, construction costs, study costs, design
costs, technical fees, tenant fitting-out costs paid for by the
Group, letting fees and related costs, eviction costs and vacancy
costs for renovations or redevelopments of standing assets; and
(ii) opening marketing expenses. It excludes: (i) step rents and
rent-free periods; (ii) capitalised financial interests; (iii)
overhead costs; (iv) early or lost Net Rental Income; and (v) IFRS
adjustments. 19 Based on MGR signed, all agreed to be signed and
financials agreed.
20 i.e. the disposal of Novotel Lyon Confluence
and Westfield Mission Valley as well as the sale or foreclosure of
Westfield Valencia Town Center and San Francisco Centre.21 On an
IFRS basis and on last 12 months basis.22 Considering the undrawn
credit lines (subject to covenants) and cash on hand.
23 The Group assumes no major US disposals which
are part of URW radical reduction of US financial exposure, no
major energy-related restrictions and no major deterioration to the
macro-economic and geopolitical environment.
Unibail Rodamco Westfield (EU:URW)
과거 데이터 주식 차트
부터 10월(10) 2024 으로 11월(11) 2024
Unibail Rodamco Westfield (EU:URW)
과거 데이터 주식 차트
부터 11월(11) 2023 으로 11월(11) 2024