Maia, Portugal - May 12th 2010
An increase of 112% compared to the first quarter 2009
Sonae Sierra recorded a Total Net Profit of € 7.3 million in the first quarter of 2010
- Direct Income from Investments grew 7% to €56.9 million compared with the same period of last year
- EBITDA grew more 25% to €29.6 million in the same period
- LeiriaShopping was successfully inaugurated contributing with a gain in the period of €5 million
- Conclusion of the sale of 45% of ALEXA in Germany
The Financial statements included in this report consolidate all the companies in proportion to better represent the Sonae Sierra position.
Sonae Sierra Total Net Profit in the first quarter of 2010 was of €7.3 million compared with a Net Loss of €59.7 million in the same period of last year, which represents a growth of 112%.
The positive variation in the Total Net Result is mainly driven by the Value Created in Investment Properties that was much higher than the one in same period of last year due to lower yield expansion in 2010. In fact, for the first time since 2Q2008, we have experienced a yield compression in Spain and in Italy with all other European countries stabilized, except for Portugal where our portfolio still felt a slight yield expansion.
In the same period Sonae Sierra's Direct Result reached €14 million (+92%), compared to the €7.3 million in the same period of 2009.
Direct Income from Investments is 7% above the same period in 2009 due to the increase in the portfolio - the openings of 2009: Loop5 and Manauara, and the good performance of the Brazilian portfolio which more than compensate the small decrease of the fixed rents in the European shopping centres (1% lower on a L4L basis).
In Brazil, it should be highlighted the continuous improvement of the operational activity.
The Company's EBITDA reached €29.6 million in the first quarter of 2010, 25% above the same period of last year as consequence of the income increase explain above and the cost cutting efforts implemented in all the Businesses of the Company.
The Company sold 45% of Alexa Shopping Centre (Berlin, Germany) to Union Investment. This sale had no impact on the 2010 Profit & Loss Account given that those effects had been already booked in 2009.
Value Metrics
The Company measures its performance, in a first instance, on the basis of changes in Net Asset Value (NAV) plus dividends distributed. The Company calculates its NAV on the basis of the guidelines published in 2007 by INREV (European Association for Investors in Non-listed Real Estate Vehicles), an association of which the Company is a member.
On the basis of this methodology, the NAV of Sonae Sierra, as of the 30th March 2010, was €1.21 billion, corresponding to a NAV per share of €37.14.
One shopping centre inaugurated and two more under construction
Sonae Sierra's growth and expansion strategy continues although the company has adjusted the development timings to the evolution of the financial and retail markets.
Following the successful refurbishment in Portugal, of AlbufeiraShopping (Algarve) completed last January, the company has successfully inaugurated on the 24th of March LeiriaShopping (Leiria) 100% let. Representing an investment of €79 million the shopping centre had more than 120.000 visits in just four days which give us a strong confidence for its future performance.
At the end of the first quarter of 2010, the Company has two new shopping centres under construction and 9 new projects in different phases of development in Portugal, Italy, Germany, Greece, Romania and Brazil.
In Italy, Sonae Sierra is currently developing Le Terrazze in La Spezia, schedule to open in the third quarter of 2010, representing an investment of more than €125 million, which has already 50% of its GLA let. In Brazil the Company has just started the construction works of Uberlândia Shopping (Uberlândia) planed to open in 2011 with a total investment of €62 million.
Sonae Sierra's Consolidated Profit and Loss Account, and Consolidated Balance Sheet
Sonae Sierra's Consolidated Profit and Loss Account and Consolidated Balance Sheet by business
About Sonae Sierra
Sonae Sierra, www.sonaesierra.com, is the international shopping centre specialist, with a passion for bringing innovation and excitement to the shopping centre industry. The Company owns 52 Shopping Centres in Portugal, Spain, Italy, Germany, Greece, Romania and Brazil, with a total Gross Lettable Area (GLA) of more than 2 million m². Sonae Sierra has 2 projects under construction and 9 new projects in different phases of development in Portugal, Italy, Germany, Greece, Romania and Brazil. In 2009, its centres welcomed more than 436 million visits.