WERELDHAVE BELGIUM NV/SA Regulated information Embargo until 24/07/2014, 08:00 AM
CONTENTS
1. Overall summary real estate markets 1
2. Interim financial report
Key figures 2
Profit 2
Direct result 3
Indirect result 3
Shareholders' equity and net asset value 3
Property portfolio 4
Corporate - Capital increase - Dividend 5
Related parties 5
Prospects 5
3 Portfolio summary at 30 June 6
4 Summarised financial statements 1st half year
Consolidated statement of financial position 9
Consolidated profit and loss account 10
Consolidated statement of direct and indirect result 12
Global result statement 12
Consolidated cash flow statement 13
Consolidated statement of movements in equity 14
Segment information 15
Movements in investment properties 17
Share data 17
Shareholders 18
Basis of preparation half year figures 18
Consolidation 19
Risk management 19
Significant events after 30 June 19
5 Obligations regarding the provision of information to the public 20
6 Statutory Auditor's Review Report 20
Wereldhave Belgium
Regulated information Embargo until 23/07/2015, 08:00 AM
1. OVERALL SUMMARY REAL ESTATE MARKETS RETAIL
Shopping centres that are dominant in a stable and / or developing catchment area provide an excellent opportunity to increase rental and value growth by active management. The occupancy rate of efficiently functioning shopping centres remains consistently high, whilst rents are less volatile than in other segments.
The investment volume in shopping centres in Belgium over the first semester was very high. Demand for this type of property by institutional investors (European as well as non-European) remains high, as a result of this the yields of shopping centres are under downward pressure.
The interest for space from retailers remains focused on prime locations. Rents in prime locations are stable, while rents in secondary locations decrease. Both the realized turnover of tenants as the number of visitors of shopping centres remains stable to slightly decreasing.
The (future) consumer's spending habits will also be determined by the internet and social media. These trends, which are closely followed, will surely change the future retail landscape.
The investment volume in this real estate segment remains low; the yields for well-located and leased office buildings remain stable.
The rental market remains difficult; older buildings are exchanged for new, sustainable, usually with a lower take-up. This mostly has to do with a more efficient way of utilization of surface and a limited work area per employee.
Often, additional services (nursery, restaurant, etc.) are offered in office parks, which means an
additional incentive to attract future tenants.
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2. INTERIM FINANCIAL REPORT Direct result per share € 2.79 (2014: € 2.61)
Positive revaluation result of € 17.0 mln (2014: € 1.0 mln)
Occupancy rate 94.2% (2014: 94.1%)
Increase in rental income (24.2%) until € 23.0 mln (2014: € 18.6 mln)
KEY FIGURES
(x € 1.000)
Profit
Direct result
Indirect result
Direct result per share (x €1) Profit per share (x €1)
Equity
01/01/15 - 30/06/15
36,375
19,387
16,988
2.79
5.24
30 June 2015
01/01/14 - 30/06/14
17,398
16,437
961
2.61
2.76
31 December 2014
Investment properties excl. development projects | 741,220 | 724,296 |
Development projects | 30,614 | 25,802 |
Real estate certificates | 9,110 | 9,116 |
Shareholders' Equity | 555,194 2) | 498,284 1) |
Net asset value per share (x €1) | 80.01 2) | 78.99 1) |
Debt ratio on total of assets | 29.5 % | 34.8 % |
Number of shares | 6,939,017 | 6,308,198 |
1) before profit distribution and dividend payment
2) before profit distribution and after dividend payment (coupon 19)
PROFIT
During the first half year, the profit, consisting of the direct and indirect result, amounted to € 36.4 mln (2014: € 17.4 mln). Compared to the same period in 2014, the increase in profit is the result of a
higher direct result (€ 3.0 mln) and a higher indirect result (€ 16.0 mln).
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DIRECT RESULT
The direct result for the first half year amounts to € 19.4 mln (2014: € 16.5 mln).
The net rental income increased by € 4.5 mln mainly due to the acquisition of the shopping centre
'Ring Shopping Kortrijk Noord' and the gradually higher occupancy of the shopping centre
'Shopping 1' in Genk and the inner city complex in Ghent. Property charges remained at a stable level
and general costs and other operating income and charges are € 0.3 mln lower.
The interest expenses amounted to € 1.6 mln versus € 0.5 mln for the same period last year. This increaseis mainly due to the take up of extra credit and a lower activation of interests ('Shopping 1' in Genk operational since 1stJanuary 2015).
The direct result per share amounts to € 2.79 (2014: € 2.61).
EPRA occupancy of the investment portfolio on 30 June stood at 94.2%, stable compared to 31
December 2014. EPRA occupancy levels per sector on 30 June 2015 (31 December 2014) were 94.9% (94.6%) for retail and 91.5% (92.5%) for offices.
The indirect result amounts to € 17.0 mln (2014: € 1.0 mln). The indirect result arises mainly from realised and unrealised changes in the value of assets in the portfolio. The positive reevaluation of the investment portfolio is a result of lower initial yields in shopping centres.
SHAREHOLDERS' EQUITY AND NET ASSET VALUE
Shareholders' equity at 30 June 2015 amounts to € 555.2 mln (31 December 2014: € 498.3 mln). The net asset value per share at 30 June 2015, including the profit for the current year - after dividend payment, amounts to € 80.01 (31 December 2014: € 78.99).
In the first half year, the average interest rate on the outstanding loans amounted to 1.27% (average interest rate 2014: 1.37%).
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PROPERTY PORTFOLIOInvestment properties
At 30 June 2015, the fair value of the investment properties portfolio - excluding development projects - amounts to € 741.2 mln (31 December 2014: € 724.3 mln).
The net increase of € 16.9 mln can mainly be attributed to investments on buildings in the portfolio of € 0.2 mln plus a positive net revaluation of € 16.9 mln. The capitalized lease discounts decreased by € 0.2 mln.
Fair value is after the deduction of transaction costs (10%-12.5%) incurred in the sales process.
Shopping centres
Wereldhave Belgium focuses on mid-sized centres that are dominant in their catchment area, and preferably with the potential for further expansion. The RREC creates value by actively managing shopping centres and (re)developing shopping centres for its own portfolio. The importance of shopping centres in the investment properties portfolio, including development projects, amounts to
84.0%. The shopping centres' occupancy rate amounts to 94.9% (31 December 2014: 94.6%).
The occupancy perpetuates itself at a high level. Over the first half year, 6 new commercial leases were contracted in the shopping centres.
During the first quarter, in the shopping centre 'Belle-Île' in Liège was a commercial lease contracted with AS Adventure (instead of C&A Kids). This rotation fits perfectly in the optimization of the branch mix and the attractivenessof the shopping centre, however this rotation has a negative impact on
the like-for-like rental growth of this shopping centre.
The like-for-like rental growth of the core portfolio (shopping centres) for the first half year amounts to 0.5% (target 2015: 1.2%).
Offices
1,496 m² office space was leased additionally in the business park 'De Veldekens' in Berchem. These leases take a start in the course of 2015. 2 contracts (1,622 m²) reached their term and were not renewed.
The occupancy rate rose from 92.5 % on 31 December 2014 to 91.5 % on 30 June 2015.
Development projects
At 30 June 2015, the fair value of the development projects portfolio amounts to € 30.6 mln (31
December 2014: € 25.8 mln). The net increase of € 4.8 mln can mainly be attributed to investments in the development project (Retail Park) in Tournai. Technical completion is scheduled for Q1 2016. The start of the construction works regarding the extension of the shopping centre 'Les Bastions' in Tournai is foreseen for early 2016.
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All other development projects are still in the planning and consent stages.
Real estate certificates
As at 30 June, Wereldhave Belgium holds an interest in listed stock exchange real estate certificate
'Basilix' (17.8%). At 30 June 2015, fair value of the portfolio real estate certificate amounts to € 9.1 mln (31 December 2014: € 9.1 mln). There were no additional certificates purchased in the first semester 2015. The certificate is in liquidation phase.
The pre-emptive rights (€ 50 mln) were successfully completed on 16 February 2015. The new shares (630,819) are entitled to dividends from 1 January 2015. After the equity operation, the number of shares in circulation amounts to 6,939,017.
The General Meeting of Shareholders on 8 April 2015 , in accordance with the proposal of the Management Company, decided to distribute a gross dividend for 2014 of € 4.60 gross (net: € 3.45). The dividend is payable as from 16 April 2015.
RELATED PARTIESDuring the first half year, no transactions have taken place between persons or institutions which can be considered as related parties of the company.
PROSPECTS
Unforeseen circumstances excepted, the Management Company expects a direct result per share
between € 5.60 and € 5.65 by the end of 2015 (2014: € 5.29).
Vilvoorde, 23 July 2015 NV Wereldhave Belgium SA Statutory Management Company
For further information: Eddy De Landtsheer eddy.de.landtsheer@wereldhave.com
+ 32 2 732 19 00
www.wereldhavebelgium.com
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3. PORTFOLIO SUMMARY AT30 JUNE2015Retail
Shopping Centre
Diversification of the portfolio (in % of valuation)
Lettable area
(in m²)
Parking spaces
(number)
Number of tenants
Rental income at 30 June
2015
(€ x 1,000)
EPRA
occupancy at
30 June 2015
'Belle-Ile' - Liège 20.84 30,252 2,200 92 5,342 99.8% Shopping Centre
Nivelles 16.47 28,600 1,452 100 3,969 100.0% Shopping Centre
'Les Bastions' - Tournai 7.06 15,540 1,260 56 1,764 100.0% Shopping Centre
'Shopping I' - Genk 10.76 27,100 1,250 51 1,530 81.1% Shopping Centre
'Ring Shopping' - Kortrijk 13.61 34,000 2,000 77 3,079 90.9%
'Overpoort' - Gent 2.04 3,700 0 6 373 84.5% Genk - Stadsplein 6.17 15,618 44 58 1,635 97.3% Waterloo 1.67 3,347 95 13 412 100.0%
78.62 158,157 453 18,104 94.9%
Offices
Madou Centre 3.77 12,162 150 1 1,298 100.0% Brussels 504 *
Jan Olieslagerslaan 0.41 3,048 82 3 120 69.6% Vilvoorde 29 *
Business- & Mediapark 1.23 5,449 178 7 265 66.9% Vilvoorde (30) 201 *
Business- & Mediapark 0.83 3,907 123 3 249 75.4% Vilvoorde (32) 120 *
Business- & Mediapark 2.64 12,772 305 8 662 96.1% Vilvoorde (28) 246 *
De Veldekens I 2.16 11,192 238 3 699 100.0% Berchem-Antwerp 368 *
De Veldekens II 3.11 16,003 316 20 1,007 93.5% Berchem-Antwerp 1,008 *
De Veldekens III 2.14 11,192 217 11 551 82.7% Berchem-Antwerp 208 *
16.29 78,409 56 4,851 91.5%
Development projects
Projects 3.92 N/A N/A
3.92 0 0
Real estate certificates
Basilix 1.17 N/A N/A
1.17
Total 100.00 236,566 509 22,955 94.2%
* storage
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GEOGRAPHICAL BREAKDOWNPROPERTY PORTFOLIO(AS A% OF ESTIMATED VALUE)
3.92%
4.94%
2.04%
13.61%
5.10%
7.42%
Brussels Ghent
1.67%
Vilvoorde Berchem-Antwerp
Waterloo Nivelles
Tournai Liège
16.93%
Genk Kortrijk
16.47%
Development
20.84%
7.06%
BRANCH MIX INVESTMENT PROPERTIES-SHOPPING CENTRES(AS A% OF RENTAL INCOME)
1%
8%
4%
6%
0%
4% 44%
0%
3%
7%
Fashion and accessories Financial institution Food
Depar tment & variety stor es
Government Health & beauty Home Equ ip ment Mu ltimedia Parking
Private Households
0%
12%
0%
11%
Restaurant & pub
Ser vices
Shoe & leatherware
Sports
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LESBASTIONS ATTOURNAI8 Wereldhave Belgium
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4. SUMMARISED FINANCIAL STATEMENTSCONSOLIDATED STATEMENT OF FINANCIAL POSITION AT 30 JUNE 2015
(x € 1,000)
Assets
Non-current assets
Investment properties
Investment prop. excl. dev. projects
Lease incentives
Development projects
Other tangible assets Financial tangible assets Assets available for sale
Real estate certificates
Trade receivables and other non-current assets
mber 2014
750,098
9,938
Current assets
Trade receivables
Tax receivables and other current assets
Cash and cash equivalents
Total assets
Shar ehol der 's equi ty
Capital
Issue premiums
Reserves
Legal reserve
Reserve for the balance of changes in fair value of real estate properties
Reserve for the balance of changes in fair value of authorised hedging instruments subject to hedge accounting
Reserve for the balance of changes in fair value of financial assets available for sale
Reserve for actuarial gains and losses of defined
pension schemes Other reserves Accumulated result Net result book year
Liabilities
Non-current liabilities
Provisions
Pensions
Non-current financial debts
Credit institutions
Other
Other loans
Rent guarantees received
Hedging intruments
Other
Deferred taxes - liabilities
Current liabilities Current financial debts Credit institutions Other
Other loans
Other
Trade payables and other current debts
Other
Suppliers
Taxes, remunerations and social security contributions
Accruals and deferred income
Real estate income received in advance
Other
Total shareholder's equity and liabilities
Net asset value per share (x € 1)
13,986
774,022
498,284
172,806
102,932
774,022
78.99
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