(AOF) – Mercialys’ rental income amounted to 43.6 million euros in the first quarter of 2022. They were thus up 2.4% over one year. “In the 1st quarter of 2022, Mercialys continued to reduce its vacancy rate towards normative levels. The stabilization of the reversion of rents, in a general context of rising inflation, also illustrates the solidity of the model”, commented Vincent Ravat, the general manager of the property company specializing in shopping centers.
As previously announced, Mercialys will propose the payment of a dividend of 0.92 euro per share for 2021, compared to a dividend limited to 0.43 euro per share the previous year. The distribution corresponds to 85% of the FFO (result of operations) 2021. The detachment of the coupon will take place on May 3, with the dividend being paid on May 5.
Following the disengagement of Casino, Generali is the largest shareholder of the property, through a holding of 7.85% of the capital. The Board of Directors, which will meet on April 28, will take stock of changes in shareholding and the associated governance.
In the end, Mercialys confirmed its 2022 objectives, namely an increase in FFO per share of at least +2%, and a dividend within a range of 85% to 95% of 2022 FFO.
AOF – LEARN MORE
=/ The strengths of the value /=
– “Pure player” for shopping malls in France, created in 2005;
– Portfolio of 50 assets, mainly outside Ile-de-France, worth €3.14 billion;
– Rental income of €170 million drawn at 31%;
– Business model based on 3 historical know-how: a portfolio of leading assets in their area and present in the city center, an omni-channel commercial concept of national and international brands attracted by the Casual Leasing financial concept and a environmental dynamic rooted in its territory;
– Open capital with a strong participation of the reference shareholder Casino (20.16%), ahead of Generali (8.01%), Eric Le Gentil chairing the board of directors of 10 members, Vincent Ravat being managing director;
– LTV ratio reduced to 36.7%, resulting in a stable BBB rating for the €1.35 billion debt.
=/ Issues /=
–
Relaunch of the growth strategy by 4 levers: development of services (especially digital), exploitation of customer knowledge and all spaces, implementation of the development pipeline and targeted and accretive acquisitions;
– Innovation strategy based on:
– a proprietary digital ecosystem with a centralized “G La Galerie” platform with data made available to client brands, a Prim’Prim’ loyalty program,
– Ocitô, a last-mile logistics and transport platform;
– Environmental strategy with quantified objectives 2017-2030:
– 47% reduction in carbon emissions and 46% reduction in those of tenants,
– accessibility: 15% of visitors coming by non-individual transport,
– 80% of purchases over €10 million with CSR clauses,
–
launch of 4 credit lines with environmental clauses
;
–
Strong competitive positions in areas on the provincial outskirts, experiencing strong momentum;
– Deployment of coworking spaces in the sites with the aim of €1.5 billion in additional revenue in 2025:
– €407 million in land resources and a project portfolio of €494 million until 2027.
=/ Challenges /=
– Monitoring of the 2 criteria specific to the real estate sector: revalued net assets or ANR (€17.6), to be compared to the stock market price, and the vacancy rate of buildings (3.2%);
– Negative impact on the perception of the title of the difficulties of Casino, which contributes to 20% of the rents;
–
limitation of the impact of health measures on rent collection and on business (€1 million in 2021);
– Continued portfolio rotation, with €82 million in expected disposals;
– 2022 objective of an increase of at least 2% in operating profit and a payout ratio of between 85 and 95%;
–
2021 dividend of €0.92, i.e. a payout rate of 75%
.
Chinese real estate still in turmoil
Real estate is essential for the growth of the world’s second largest economy. However, after the setbacks of the giants Evergrande and Fantasia, other smaller promoters are having difficulty repaying their debts. The giant Evergrande is strangled by an abyssal debt of around 260 billion euros. He is fighting to pay his bond interest on time and deliver his apartments, so as to avoid a bankruptcy that would shake the entire Chinese real estate sector. The OECD believes that the risks of a sharp slowdown in China have increased with the setbacks of Evergrande. A drop of 2 points per year in Chinese domestic demand over two years would reduce global growth by 0.4 points of GDP.