KLEPIERRE: BUSINESS REVIEW FOR THE FIRST QUARTER OF 2017press releaseBUSINESS REVIEW FOR THE FIRST QUARTER OF 2017Paris - April 26, 2017 At €320.6 million, total revenues in line with Q1 2016, despite significant asset disposals in 2016 and early 2017; Shopping center gross rental income +0.4% to €293.2 million; Retailer sales +0.6% on a like-for-like basis[1] (on a 12-month rolling basis ended March 2017); Accelerated
leasing activity with 523 leases signed (vs 386 in Q1 2016),
representing €10.0 million in additional minimum guaranteed rents on a
yearly basis (excluding new project...
KLEPIERRE: BUSINESS REVIEW FOR THE FIRST QUARTER OF 2017press releaseBUSINESS REVIEW FOR THE FIRST QUARTER OF 2017Paris - April 26, 2017 At €320.6 million, total revenues in line with Q1 2016, despite significant asset disposals in 2016 and early 2017; Shopping center gross rental income +0.4% to €293.2 million; Retailer sales +0.6% on a like-for-like basis[1] (on a 12-month rolling basis ended March 2017); Accelerated
leasing activity with 523 leases signed (vs 386 in Q1 2016),
representing €10.0 million in additional minimum guaranteed rents on a
yearly basis (excluding new projects and extensions) vs €4.2 million in
Q1 2016; Strong
consumer response to Hoog Catharijne first redevelopment phase opening
(footfall +11%) and Val d'Europe extension (footfall +31%); Further
€100 million reduction in net debt at March 31, 2017 vs year-end 2016;
net cost of debt reduced to less than 2.0% for the first quarter of
2017; Disposals completed and signed worth €213.0 million year-to-date. 2017 outlook confirmed: net current cash flow per share expected between €2.35 and €2.40 KEY FINANCIALS In € millions, Total-Share basis Q1 2017 Q1 2016 % Change Gross rental income - Shopping centers 293.2 291.9 +0.4 Gross rental income - Other activities 7.3 7.9 -8.6 Total gross rental income total 300.4 299.8 +0.2 Management, administrative and other income (fees) 20.2 22.9 -12.0 Total revenues 320.6 322.8 -0.7 OPERATING PERFORMANCE Total revenues For
the first quarter of 2017, gross rental income (total share) rose to
€300.4 million from €299.8 million for the same period last year, as the
contribution from organic growth offset the impact of disposals
(-€6.3 million). Shopping center gross rental income
(GRI, total share) increased by 0.4%, or €1.3 million, to €293.2 million
in the period. Disposals completed in 2016 and early 2017 had a
negative €5.9 million impact on shopping center GRI while the
contribution from index-linked adjustments was +0.7%.GRI from other activities amounted to €7.3 million.Management,
administrative and related income (fees) totaled €20.2 million, down
€2.7 million from the first quarter last year due to seasonal effects.Total revenues for the first quarter of 2017 reached €320.6 million, virtually unchanged versus the same period last year. Retailer sales On a rolling twelve-month basis, retailer sales
were up by 0.6%. On a like-for-like portfolio basis,1 retailer sales in
Klépierre's shopping malls declined by 0.6% in Q1 2017 compared to the
same quarter last year, mainly due to negative calendar effects: one
less Saturday in January and one less working day in February 2017. This
year, after a downward trend in January, broadly stable in February,
retailer sales recovered in March. These figures benefited from no
contribution of extensions or recent developments.In
this context, retailers in France (-1.3%), Italy (-2.2%) and Scandinavia
(-0.6%) posted slower sales in the first quarter while Iberia (+0.4%)
and CEE & Turkey (+6.6%) remained solid. In France, consumers slowed
spending ahead of the spring elections while, in Italy, retailer sales
were impacted by increased competition in Milan. Leasing activity Leasing
activity was very dynamic. In the first quarter, Klépierre signed a
total of 523 leases, representing €10.0 million in additional annual
minimum guaranteed rents (excluding contributions from extension and
greenfield projects), a clear acceleration compared to the first quarter
of 2016 (386 leases and €4.2 million in additional MGR).Klépierre
also accelerated the implementation of its "Destination Food" strategy,
with the introduction of innovative concepts such as Five Guys (Hoog
Catharijne, Alexandrium), Grom (Val d'Europe, Prado), Johnny Rockets
(Lonato), Leon (Hoog Catharijne) and Wagamama (Prado). New dedicated
food areas in Hoog Catharijne (City Square, Pavillon), Val d'Europe
(Place des Étoiles) and the Prado rooftop are further enhancing the
attractiveness of the food & beverage offering in Klépierre's malls.Leasing
activity in France was bolstered by the launch of the re-leasing
campaign at St.Lazare Paris, which is capturing great reversion with
trendy brands. NYX, Rituals, Levi's, Calzedonia and Bialetti plan to
open new shops while leases with Petit Bateau and Pylones were renewed.
In addition, in the first quarter of 2018, Sephora will unveil one of
its largest stores in the world (and 2nd
largest in France) with a 1,000+ sq.m. store in a new and innovative
concept. These successes underscore the relevance of Klépierre's
strategy of transforming the St. Lazare hub into a disruptive retail
destination. Sephora has also signed 4 additional leases for Klépierre
malls: in Annecy Courier (renewal), Marseille Bourse (opening), Val
d'Europe (new concept) and Villiers-en-Bière (renewal).In
Spain, the ongoing implementation of the Clubstore® concept in
Plenilunio has triggered an acceleration of renewals and refurbishments,
including Stradivarius and Pull&Bear (both including a store
extension), Okaïdi, C&A, Levi's and Etam. New tenants, such as
Skechers and Lush, are arriving and will further improve Plenilunio's
position as one of the leading platforms in Madrid for international
retailers.After signing 24 leases with Inditex in
2016, Klépierre signed six additional leases in the first quarter of
2017, including a 3,000-sq.m. Zara store in Nový Smichov (Prague). DEBT POSITION AND FINANCING UPDATE On February 9, 2017, Klépierre issued a 10-year, €500 million bond with a 1.375% coupon. [2]On
March 13, 2017, Klépierre announced a share buyback program up to €500
million. As of April 25, 3,748,000 shares had been repurchased at an
average €35.85 per share, representing an investment of €134 million.As
of March 31, 2017, the Group's consolidated net debt amounted to
€8,510 million, a reduction of €103 million compared to year-end 2016.
Klépierre's average debt duration remained stable at 6 years and the net
cost of debt continued to decrease below 2.0%.On
April 25, 2017, the dividend was paid out to shareholders for a total
amount of €562 million (€1.82 per share for fiscal year 2016). DEVELOPMENT PIPELINE AND ASSET ROTATION Successful delivery of two iconic projects After three years of construction, on April 12, 2017, Klépierre unveiled a 17,000-sq.m. extension
at Val d'Europe (near Paris), bringing the French mall's total sales
area to more than 105,000 sq.m. The extension features 30 new brands,
including flagship stores. The Group is currently implementing the
Clubstore® concept through a refurbishment of the entire shopping
center. Between April 12 and April 23, Val d'Europe received 0.6 million
visitors, a 31% increase compared to the same period last year.[3] Watch the video here.On
April 6, 2017, the Group officially opened 16,000 sq.m. of new retail
space, leased-up at 85%, at Hoog Catharijne (Utrecht), the leading mall
in the Netherlands. New stores were added to the shopping center's
offering: on the fashion segment (Zara, Zara Home, Bershka,
Stradivarius, NAME IT, WE, Men At Work, Claudia Sträter, Bijou Brigitte,
Manfield, Parfois, Nike, Jack & Jones, Vero Moda, Sissy-Boy,
Timberland), Food / Restaurant (Leon, Comptoir Libanais, Burger
Federation, Five Guys, Vapiano, Exki and McDonald's new concept) or
Health & Beauty (Yves Rocher, MAC, Rituals). Between April 5 and
April 18, the newly opened part of Hoog Catharijne received nearly 1.1
million visitors, an 11% increase compared to the same period last year[4]. Disposals signed for €213.0 million Since January 1, 2017, Klépierre has completed disposals of non-core assets for €177.3 million[5],
across Europe (Norway, Sweden, France and Spain). Based on 2016 rents,
the implied yield of shopping centers sold amounts to 5.7% while sale
prices are slightly above the last appraised values. In addition, assets
worth €35.7 million are currently under sale or purchase promissory
agreements. OUTLOOK CONFIRMED In
2017, Klépierre expects net rental income to continue to grow on a
like-for-like basis, while operational and financial costs should be
further reduced. Assuming stable or lower net debt, Klépierre expects to
generate net current cash flow per share of between €2.35 and €2.40. RETAILER SALES like-for-like change FOR THE FIRST QUARTER OF 2017 Countries Q1 2017 Year-on-Year Change France -1.3% Belgium -1.5% France-Belgium -1.3% Italy -2.2% Norway 0.5% Sweden -0.6% Denmark -3.0% Scandinavia -0.6% Spain 0.9% Portugal -0.7% Iberia 0.4% Poland 3.8% Hungary 11.4% Czech Republic 7.3% Turkey 6.5% CEE and Turkey 6.6% The Netherlands N/A Germany -2.7% TOTAL -0.6% TOTAL REVENUES In € millions Total Share Group Share Q1 2017 Q1 2016 Q1 2017 Q1 2016 France 100.4 100.3 82.7 83.0 Belgium 4.4 4.1 4.4 4.1 France-Belgium 104.8 104.4 87.1 87.1 Italy 51.8 50.9 51.0 50.0 Norway 18.5 17.7 10.4 9.9 Sweden 16.0 17.1 9.0 9.6 Denmark 14.2 13.4 8.0 7.5 Scandinavia 48.8 48.2 27.4 27.0 Spain 22.8 23.4 22.0 22.6 Portugal 5.5 5.2 5.5 5.2 Iberia 28.3 28.5 27.5 27.8 Poland 8.8 8.4 8.8 8.4 Hungary 5.5 5.3 5.5 5.2 Czech Republic 7.5 6.6 7.5 6.6 Turkey 8.2 8.7 7.6 8.0 Others 0.7 0.9 0.7 0.8 CEE and Turkey 30.8 30.0 30.1 29.2 The Netherlands 15.0 15.6 15.0 15.6 Germany 13.6 14.3 13.0 13.6 SHOPPING CENTERS GROSS RENTAL INCOME 293.2 291.9 251.2 250.3 Other activities 7.3 7.9 7.3 7.9 TOTAL GROSS RENTAL INCOME 300.4 299.8 258.4 258.3 Management, administrative and related income (fees) 20.2 22.9 19.2 21.7 TOTAL REVENUES 320.6 322.8 277.7 280.0 Equity Accounted Investees* 22.3 23.9 21.2 22.3 * Contributions
from Equity Accounted Investees include investments in
jointly-controlled companies and investments in companies under
significant influence. Equity Accounted Investees are accounted for a
total value of €1,425 million as of December 31, 2016. QUARTERLY REVENUES ON A TOTAL-SHARE BASIS In € millions Q1 2017 Q4 2016 Q3 2016 Q2 2016 France 100.4 106.6 101.7 102.8 Belgium 4.4 4.4 4.4 4.2 France-Belgium 104.8 110.9 106.1 107.0 Italy 51.8 51.4 50.6 51.8 Norway 18.5 20.2 18.8 18.4 Sweden 16.0 15.6 17.7 17.5 Denmark 14.2 13.5 14.3 13.5 Scandinavia 48.8 49.4 50.8 49.3 Spain 22.8 22.2 23.0 23.8 Portugal 5.5 5.1 5.3 5.1 Iberia 28.3 27.4 28.3 28.9 Poland 8.8 8.8 8.5 8.6 Hungary 5.5 5.5 5.3 5.1 Czech Republic 7.5 7.3 6.8 6.6 Turkey 8.2 9.2 9.0 8.6 Others 0.7 0.8 0.4 0.8 CEE and Turkey 30.8 31.6 30.1 29.7 The Netherlands 15.0 15.2 15.2 15.1 Germany 13.6 13.5 15.0 14.4 SHOPPING CENTERS GROSS RENTAL INCOME 293.2 299.3 296.0 296.2 Other activities 7.3 6.8 8.0 7.9 TOTAL GROSS RENTAL INCOME 300.4 306.1 304.0 304.1 Management, administrative and related income (fees) 20.2 22.1 20.6 20.9 TOTAL REVENUES 320.6 328.2 324.6 325.0 Equity Accounted Investees* 22.3 23.0 23.6 25.0 * Contributions
from Equity Accounted Investees include investments in
jointly-controlled companies and investments in companies under
significant influence. Equity Accounted Investees are accounted for a
total value of €1,425 million as of December 31, 2016. AGENDA July 25, 2017 First-Half 2017 Earnings (press release after market close) Investor relations contacts media contacts Hubert d'AILLIÈRES +33 (0)1 40 67 51 37 - hubert.daillieres@klepierre.com Julien ROUCH +33 (0)1 40 67 53 08 - julien.rouch@klepierre.com Lorie LICHTLEN, Burson-Marsteller i&e +33 (0)1 56 03 13 01 - lorie.lichtlen@bm.com Camille PETIT, Burson-Marsteller i&e +33 (0)1 56 03 12 98 - camille.petit@bm.com ABOUT KLÉPIERRE The
leading pure play shopping center property company in Europe, Klépierre
combines development, property and asset management skills. The
company's portfolio is valued at €22.8 billion at December 31, 2016 and
comprises large shopping centers in 16 countries in Continental Europe
which altogether welcome 1.1 billion visitors per year. Klépierre holds a
controlling stake in Steen & Strøm (56.1%), Scandinavia's number
one shopping center owner and manager. Klépierre is a French REIT (SIIC)
listed on Euronext Paris and included in the CAC Next 20, EPRA Euro
Zone and GPR 250 indexes. It is also included in ethical indexes, such
as DJSI World and Europe, FTSE4Good, STOXX® Global ESG Leaders, Euronext
Vigeo France 20 and World 120, and is ranked as a Green Star by GRESB
(Global Real Estate Sustainability Benchmark). These distinctions
underscore the Group's commitment to a proactive sustainable development
policy.For more information: www.klepierre.com This press release is available on Klépierre's website: www.klepierre.com[1]
Like-for-like change is on a same-center basis and excludes the impact
of asset sales and acquisitions. Retailer sales from the Dutch portfolio
are not included in these figures since Dutch retailers do not report
sales to Klépierre. [2] For more information, please refer to the press release published on February 9, 2017, available on www.klepierre.com. [3] For more information, please refer to the press release published on April 11, 2017, available on www.klepierre.com. [4] For more information, please refer to the press release published on April 6, 2017, available on www.klepierre.com. [5] Total share, excluding duties. PR_KLEPIERRE_2016_Q1_REVENUES_26_APRIL_2017_UK_FINAL
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