Strong operating income Foncière des Murs confirms its number one hotel property investor status
PR Newswire/Les Echos/
Paris, 8 February 2013
Strong operating income
Foncière des Murs confirms its number one hotel property investor status
Acquisition of 165 B & B hotel portfolio bolsters presence in the hotel industry
Foncière des Murs, in a partnership with Crédit Agricole Assurances and Assurances du Crédit Mutuel, acquired a portfolio of 165 B & B hotels in November 2012 for a total amount of EUR513 million at 31 December 2012, or EUR258 million group share, with Foncière des Murs holding a 50.2% stake.
This acquisition was partially financed by a capital increase of EUR125 million, carried out with the support of the primary Foncière des Murs shareholders in April 2012, resulting in 7.8 million new shares created.
With this purchase, Foncière des Murs becomes the leading lessor amongst the three major hotel operators in France-Accor, B & B and Louvre Hotels-thus confirming its number one hotel property hotel investor status.
A diversified financing source and reinforced financial structure
* EUR520 million in new funds, which covers all loans maturing in 2013 and a portion of those coming due in 2014
Foncière des Murs has refinanced all debt instruments maturing in 2013 as well as part of those maturing in 2014, while diversifying its financing sources. The EUR520 million of new financing breaks down as follows: - Bank debt in the amount of EUR265 million is made up of mortgages with a 5-year maturity. - Another EUR255 million are in the form of a mortgage bond issue with a 7-year maturity. This innovative issue, the first for listed covered bonds in France, was underwritten by institutional investors.
The financial statements were approved by the Supervisory Board on 8 February 2013. Audit procedures for the consolidated financial statements were carried out. A certification report will be produced following final specific verification processes.
* EUR332 million in asset sales and sales agreements, at a price 1.9% higher than the appraised value, of which EUR269 million are new commitments signed in 2012.
These sales involved 80 properties including: - 28 hotels including the buildings and business assets, for EUR140 million - 41 operating retail properties, as single units or as part of portfolios, for EUR1 12 million. The sale of Quick and Courtepaille restaurants were the first to be carried out by Foncière des Murs. These sales demonstrated the liquidity and attractiveness of this class of assets, which was evident through the interest shown by investors - 11 Healthcare properties for EUR80 million
These asset sales, which were realised directly, satisfy two objectives, namely asset rotation and debt reduction, in line with the 2011 asset sales.
As a result, Foncière des Murs' financial structure was markedly strengthened, with an LTV ratio of 42.4% compared with 45.8% as at 31 December 2011. In this way, LTV has dropped by nearly ten points since 31 December 2010.
31 December 2011 31 December 2012 Change LTV (excluding charges) 48.4% 44.8% -360 bps LTV (including charges) 45.8% 42.4% -340 bps
Average debt maturity has increased by one year, moving to 3.6 years. Lastly, interest cover (ICR) amounted to 2.60 as at 31 December 2012, stable compared with the end of 2011.
Slight increase in rental income: 0.5% like-for-like increase
1 part 1 part After minority 1 part
interests (in EUR m) 31/12/2011 31/12/2012 31/12/2012 Change Change Like
(in EUR m) % -for- like %
change Hotels 133.2 116.6 114.3 - 16.6 -12.5% -0.9% Healthcare 26.8 24.4 24.4 - 2.3 -8.7% 3.5% Retail 43.6 43.7 43.7 0.1 0.3% 2.6%
Rental income 203.6 184.8 182.5 - 18.8 -9.3% 0.5%
Rental income at 31 December 2012 decreased by EUR18.8 million in absolute value terms, which primarily reflects the impact of the 2011 and 2012 disposals, particularly in hotels. On a like-for-like basis, rental income increased by 0.5% for the year, despite the depressed economic environment.
Net recurring EPRA income of EUR112.8 million, and EPS of EUR1.82
Net recurring EPRA income amounted to EUR112.8 million, down 6.6% from EUR120.8 million at 31 December 2011. This decrease reflects the impact of the arbitrage and deleveraging strategy (asset sales amounting to EUR750 million since the beginning of 2011). On a per share basis, net recurring EPRA income amounted to EUR1.82 at 31 December 2012, down 14.9% from EUR2.14 at 31 December 2011.
Meanwhile, net income, Group share, came in at EUR99.7 million compared with EUR141.3 million at the end of 2011.
31 December 2011 31 December 2012 % Change Recurring net EPRA income (EUR m) 120.8 112.8 -6.6% Recurring net EPRA earnings per share EUR2.14 EUR1.82 -14.9%* Net income, in EURm 141.3 99.7 n/a
*The average number of shares increased between 2011 and 2012, following the April 2012 capital increase.
NAV of EUR1,665 million, up 9.3%
At 31 December 2012, portfolios held excluding consolidated companies was valued at EUR3,039 million excluding charges (Group share), compared to EUR2,949 million at 31 December 2011. On a like-for-like basis, NAV increased by 1.8% compared with the end of 2011, and posted an average yield of 6.3% (excluding charges).
EPRA NAV increased by 9.3% to EUR1,664.8 million (i.e. EUR25.90 per share), up from EUR1,523.2 million (i.e. EUR27.00 per share) at the end of 2011. EPRA NAV increased by 10.7% to EUR1,414.6 million (i.e. EUR22.00 per share), up from EUR1,278.0 million (i.e. EUR22.60 per share) at the end of 2011.
31 December 2011 31 December 2012 Change Total portfolio value (group share) 2,949 3,039 +1.8%
like-for-like Value of portfolio under management 3,571 4,006 +2.0%
like-for-like EPRA NAV 1,523.2 1664.8 +9.3%
EPRA NAV per share 27.0 25.9 -3.9%*
*The number of shares increased between 2011 and 2012, following the April 2012 capital increase.
Outlook for 2013
Foncière des Murs confirms its objective to continue to benefit from the development opportunities in the hotel industry, particularly by assisting its tenants in their development activities, thus bolstering existing partnerships. Foncière des Murs has established the objective of stabilising net recurring income in 2013. It will also propose during the General Meeting a dividend for 2012 of EUR1,50 per share.
Cécile Boyer Sébastien Bonneton Tel: +33 (0)1 58 97 54 47 Tel: +33(0)1 58 97 52 44 firstname.lastname@example.org email@example.com About Foncière des Murs Foncière des Murs, a subsidiary of Foncière des Régions, specialises in the ownership of business premises, especially in the hotel, healthcare, and retail sectors. As a listed real estate investment company (SIIC), Foncière des Régions is a real estate partner for major players in the business properties sector. Foncière des Murs owns a portfolio amounting to EUR3 billion and manages a EUR4 billion portfolio. www.foncieredesmurs.fr About Foncière des Régions As a major player in the service sector real estate for Offices & Key Accounts, Foncière des Régions owns and manages a EUR9 billion portfolio that is primarily leased to key accounts who are leaders in their business sectors, including SUEZ Environnement, Thales, Dassault Systèmes, France Telecom, EDF, and Accor, etc. As companies' real estate strategy partner, Foncière des Régions works with clients to design innovative and sustainable real estate solutions. www.foncieredesregions.fr APPENDICES Appraised value at 31 December 2012 Like-for- like change Yield
Value at Value at over 12 (excluding (in EUR m) 31/12/2011 31/12/2012 months charges) Hotels 1,834 2,053 0.8% 6.1% Healthcare 423 356 2.3% 6.4% Retail 692 630 3.6% 6.4% TOTAL asset portfolio (after minority interests), excluding consolidated companies 2,949 3,039 1.8% 6.3%
TOTAL consolidated asset portfolio - in total excluding consolidated companies 3,299
Like-for- like change Yield
Value at Value at over 12 (excluding (in EUR m) 31/12/2011 31/12/2012 months charges) Consolidated asset portfolio - in total 2,949 3,299 1.8% 6.3%
Total directly- owned portfolio - in total 622 708 3.0% 6.3% Total portfolio under management 3,571 4,006 2.0% 6.3% Asset indicators FdM consolidated assets after minority interests - EUR3,039 m Santé 12 % Commerce d'exploiatation 21 % Hôtels Loyers Fixes 20 % Hôtels Loyers Variables 47 % FdM assets under management - EUR4,006 m Santé 9 % Commerce d'exploiatation 16 % Hôtels Loyers Fixes 21 % Hôtels Loyers Variables 54 % Terms of debt Net debt -3% compared to 31/12/2011 EUR1,452 m Average cost of debt 4.49% 4.39% at 31/12/2011 Average debt maturity +1.1 compared to 31/12/2011 3.7 years Total active hedging debt ratio 95.1% Net asset value 31/12/2011 31/12/2012 2011/2012
Change EPRA Triple net NAV(EURm) 1,278.0 1,414.6 +10.7% EPRA net triple NAV per share (EUR) 22.6 22.0 -2.7% EPRA NAV (EURm) 1,523.2 1,664.8 +9.3% EPRA NAV per share (EUR) 27.0 25.9 -3.9%
Reconciliation of net income to recurring net income
EURM Net income Restatements Recurring net
income RENTAL INCOME 182.5 182.5 UNRECOVERED LEASE EXPENSE -0.1 -0.1 BUILDING EXPENSES -2.9 -2.9 EXPENSES NET OF UNRECOVERABLE RECEIVABLES -0.0 -0.0
NET RENTAL INCOME 179.4 - 179.4 MANAGEMENT AND ADMINISTRATION INCOME 2.8 - 2.8 BUSINESS-RELATED EXPENSES -1.0 -1.0 OVERHEADS -7.4 0.1 -7.3 DEVELOPMENT EXPENSES -0.2 0.2 -
- OPERATING COSTS -5.8 0.3 -5.5
- NET CHANGE IN PROVISIONS AND OTHER ITEMS -1.4 1.4 - OPERATING INCOME FROM CONTINUING OPERATIONS 172.2 1.8 174.0
- PROCEEDS FROM ASSET SALES 232.3 -232.3 - BOOK VALUE OF ASSETS SOLD -232.8 232.8 - NET GAINS/LOSSES FROM ASSET SALES -0.5 0.5 - REVALUATION INCREASE in investment properties 54.6 -54.6 - REVALUATION DECREASE in investment properties -10.9 10.9 -
- NET REVALUATION INCREASE / DECREASE 43.7 -43.7 - NET GAINS / LOSSES FROM SALE OF SECURITIES - - - OPERATING INCOME 215.4 -41.4 174.0 NET COST OF FINANCIAL DEBT -65.7 -65.7 Adjustment TO THE value of derivative instruments. payables and receivables -49.4 49.4 - DISCOUNTING OF payables AND RECEIVABLES -1.3 1.3 - NET CHANGE IN FINANCIAL AND OTHER PROVISIONS -4.6 4.6 - Share of income from Equity associates 9.6 -4.9 4.7
NET INCOME BEFORE TAX 103.9 9.1 113.0
DEFERRED TAX -4.0 4.0 - CORPORATE INCOME TAX -0.2 -0.2
NET INCOME FOR THE PERIOD. GROUP SHARE 99.7 13.1 112.8
Consolidated balance sheet
EURM Net Net
31 Dec 11 31 Dec 12 GOODWILL INTANGIBLE ASSETS TANGIBLE ASSETS Operating properties Other tangible fixed assets 0.0 0.0 Assets in progress INVESTMENT PROPERTIES 2,593.6 3,006.3 FINANCIAL ASSETS 7.0 6.8 INVESTMENTS,IN EQUITY ASSOCIATES 61.1 70.2 DEFERRED TAX ASSETS 1.2 1.1 FINANCIAL INSTRUMENTS 7.4 9.8
TOTAL NON-CURRENT ASSETS 2,670.3 3,094.1
ASSETS HELD FOR SALE 355.1 292.3
LEASING LOANS AND RECEIVABLES 0.2 INVENTORIES AND WORK-IN-PROGRESS TRADE RECEIVABLES 14.5 9.5 TAX RECEIVABLES 4.1 5.6 OTHER RECEIVABLES 3.8 1.2 PREPAID EXPENSES 0.7 2.4 CASH AND CASH EQUIVALENTS 1.2 4.5
TOTAL CURRENT ASSETS 379.3 315.7
TOTAL ASSETS 3,049.6 3,409.8
Financial year Financial year
31 Dec 11 31 Dec 12 CAPITAL 225.8 256.9 PREMIUMS 410.3 502.6 TREASURY SHARES -0.1 -0.1 CONSOLIDATED RESERVES 500.7 557.2 NET INCOME 141.3 99.7 TOTAL GROUP SHAREHOLDERS' EQUITY 1,278.0 1,416.3 MINORITY INTERESTS -1.9 146.9 TOTAL SHAREHOLDERS' EQUITY 1,276.1 1,563.1 Long-term borrowings 1,464.7 1,540.2 FINANCIAL INSTRUMENTS 205.2 205.2 Deferred tax liabilities 45.7 49.5 PENSION AND OTHER COMMITMENTS 0.0 0.0 OTHER PAYABLES 4.1 1.5
TOTAL NON-CURRENT LIABILITIES 1,719.7 1,796.5
LIABILITIES HELD FOR SALE TRADE PAYABLES 8.6 12.3 SHORT-TERM BORROWINGS 30.8 26.7 SECURITY DEPOSITS ADVANCES & PREPAYMENTS 0.5 2.6 ST PROVISIONS CURRENT TAXES 0.1 OTHER PAYABLES 13.7 8.2 ADJUSTMENT ACCOUNTS 0.1 0.3
TOTAL CURRENT LIABILITIES 53.8 50.1
TOTAL LIABILITIES 3,049.6 3,409.8
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