LOOK AHEAD Deutsche Euroshop Real Estate Summer Gdansk 2015 21.08.2015
LOOK AHEAD
Deutsche Euroshop Real Estate Summer
Gdansk 2015
21.08.2015
Agenda
Deutsche EuroShop – Update
Galeria Baltycka Extension
Portfolio Activities
Investment Market
Discussion
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AGENDA
1) incl. non controlling interests
Key Figures H1 2015
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COMPANY
€ million 01.01.-30.06.2015 01.01.-30.06.2014 Change
Revenue 100.6 99.7 1%
Net operating income 91.8 90.5 1%
EBIT 88.2 88.3 0%
Net finance costs -24.7 -28.0 -12%
Valuation result -2.0 -2.9 31%
EBT 61.5 57.4 7%
Consolidated profit 49.7 46.3 7%
FFO per share (€) 1.14 1.09 5%
Earnings per share (€, undiluted) 0.92 0.86 7%
€ million 30.06.2015 31.12.2014 Change
Total equity1) 1,736.0 1,751.2 -1%
Financial liabilities 1,461.4 1,430.1 2%
Other debt (incl. Deferred taxes) 307.6 310.9 -1%
Total assets 3,504.9 3,492.2 0%
Net financial liabilities 1,388.1 1,371.8 1%
Equity ratio1) 49.5% 50.1%
LTV ratio 41% 40%
Gearing1) 102 99
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FINANCIALS
1) Compound Annual Growth Rate (CAGR) 2010-2016 2) incl. dilution 3) excl. capital gain
Forecast
REVENUE
€m
EBIT
€m
EBT EXCLUDING VALUATION3)
€m
FFO PER SHARE
€
1.40 1.61 1.66 2.08 2.23
2010 2011 2012 2013 2014 2015 2016
63.9 86.6 95.1 113.4
1 2 3 4 5 6 7
124.0 165.7 151.61) 165.81) 177.5 179-182
144.2 190.0 178.21) 188.01) 200.8 203-206
1 2 3 4 5 6 7
+1%
+1%
+3%
+3%
+32%
+34%
+36%
+15%
+10%
+3%
+19%
+25%
+7%
+7%
+10%
+7%
201-204
177-180
125.0 126-129 130-133
2.24-2.28 2.30-2.34
Equity method
Equity method
CAGR1)2): +9%
CAGR1): +13%
+1% +5%
+9% +1%
+2%
+1%
Opportunity to grow
Strong performance of Galeria Balycka since opening
– Leasing status >99%
– High productivity
– #1 player in Gdansk region
Meet substantial tenant demand
– successful tenants need more space
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EXTENSION GDANSK
Opportunity to grow (cont.)
Improve customer satisfaction:
– increased retail variety by gaining up to 70 new brands and concepts
– tenants will invest in new stores making them more attractive
Staying ahead of competition
– Riviera
– Forum Radunia
Investment case
– attractive investment return well above current market yields
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EXTENSION GDANSK
Opening center Fall 2007 (first leasing cycle due in 2017)
Leasable area (GLA) 48.700 + 13.800 = 62.500 sqm after extension
No. of parking places 1.100 + 200 = 1.300 after extension
No. of shops 200 + 70 = 270 after extension
No. of retail / parking levels 3 / 2
Anchor tenants Inditex Group, P&C, H&M, Saturn, Intersport, Carrefour
Investment volume extension 70-75 Mio. EUR (100% view, DES share: 74%)
Key Project Data*
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EXTENSION GDANSK
* subject to change
Aerial view of the extension part
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EXTENSION GDANSK
Plot situation: all plots are owned or secured
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EXTENSION GDANSK
Environmental permit valid 2015
Stream relocation 2016 Building permit extension 2016/17
Construction start 2016/17
Grand opening 2018
Project Steps*
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EXTENSION GDANSK
* subject to change
Conceptual Design Example: Highly Attractive Architecture
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EXTENSION GDANSK
Target Tenants
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EXTENSION GDANSK
Anchor tenants:
H&M (extension)
Inditex brands
− Zara (prolongation)
− Stradivarius / Bershka / Pull & Bear (extensions/relocations)
− Massimo Dutti / Zara Home (new openings)
LPP brands
− Reserved (extension)
− Sinsay / House / Cropp (extensions/relocations)
Peek & Cloppenburg
On-going intensive talks to the tenants
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EXTENSION GDANSK
* subject to change
= outline of the existing center
Target Leasing Concept* - Basement
Target Leasing Concept* – Ground Floor
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EXTENSION GDANSK
* subject to change
Target Leasing Concept* – 1st Floor
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EXTENSION GDANSK
FLOOR
* subject to change
Summary
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EXTENSION GDANSK
attractive opportunity to grow
right timing
plots secured
well received from the leasing market
building permit processes ongoing
long development & construction time due to complexity
good expected returns
Phoenix-Center Hamburg: Extension in the Basement
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PORTFOLIO ACTIVITIES
Phoenix-Center Hamburg: Extension in the Basement
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PORTFOLIO ACTIVITIES
Phoenix-Center Hamburg: Extension in the Basement
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PORTFOLIO ACTIVITIES
City-Point Kassel: Creating Atmosphere for the 3rd Place
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PORTFOLIO ACTIVITIES
439 sqm shop area
198 seats + 20 seats on the balcony
City-Point Kassel: Creating Atmosphere for the 3rd Place
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PORTFOLIO ACTIVITIES
Internal Growth with Extensions
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PORTFOLIO ACTIVITIES
Simulation Phoenix-Center
€30m @ 6%
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INVESTMENT MARKET
European Retail Investment Volumes 2014
Germany: Transaction Volume Shopping Center
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INVESTMENT MARKET
5-year average
bn. €
source: JLL
lack of supply
incl. corporate transactions
Germany: International Player dominating the scene
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INVESTMENT MARKET
H1 2015: 84% of the investors in German shopping centers were international (after 63% in 2014), by volume
source: JLL
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INVESTMENT MARKET
This time it´s different: Quality investments can pay off also long term!
Investment Cycle and Relative Returns
Investment Strategy – Financial Parameters
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INVESTMENT MARKET
no „fixed cap rate hurdle“ for acquisitions, but prudent investment policy:
− valuation of sustainable rent, NOI and growth
− thorough due diligence, e.g. on capex
investments with long-term strong cash-flow contributions
long-term NAV growth
averaging of pricing (buying through the cycles in case of opportunities)
Investment Strategy – Quality Parameters
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INVESTMENT MARKET
high-quality shopping centers
realistic catchment areas >300,000 inhabitants
>25,000 sqm leaseable area, special cases >15,000 sqm
A/B centers in A cities
A centers in B cities
Investment Strategy – Target Countries
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INVESTMENT MARKET
Germany
Austria
Poland
Hungary
()
Czech Republic
Pecs
Contact
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APPENDIX
Deutsche EuroShop AG Investor & Public Relations Heegbarg 36 22391 Hamburg
Tel. +49 (40) 41 35 79 - 20 / -22 Fax +49 (40) 41 35 79 - 29 E-Mail: [email protected] Web: www.deutsche-euroshop.com
Important Notice: Forward-Looking Statements
Statements in this presentation relating to future status or circumstances, including statements regarding management’s plans and objectives for future operations, sales and earnings figures, are forward-looking statements of goals and expectations based on estimates, assumptions and the anticipated effects of future events on current and developing circumstances and do not necessarily predict future results.
Many factors could cause the actual results to be materiallydifferent from those that may be expressed or implied bysuch statements.
Deutsche EuroShop does not intend to update these forward-looking statements and does not assume any obligation to do so.
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Patrick Kiss Head of Investor & Public Relations
Nicolas Lissner Manager Investor & Public Relations
Wilhelm Wellner Chief Executive Officer
Olaf Borkers Chief Financial Officer