EQS-News: CPI PROPERTY GROUP publishes financial results for 2022
EQS-News: CPI PROPERTY GROUP
/ Key word(s): Annual Report/Real Estate
CPI PROPERTY GROUP publishes financial results for 2022
31.03.2023 / 23:58 CET/CEST
The issuer is solely responsible for the content of this announcement.
CPI Property Group
(société anonyme)
40, rue de la Vallée
L-2661 Luxembourg
R.C.S. Luxembourg: B 102 254
Press Release - Corporate News
Luxembourg, 31 March 2023
CPI PROPERTY GROUP publishes financial results for 2022
CPI PROPERTY GROUP (hereinafter “CPIPG”, the “Company” or together with its subsidiaries the “Group”) hereby publishes audited financial results for the financial year ended 31 December 2022.
“2022 was an exceptional year of change for CPIPG,” said Martin Němeček, CEO. “Through our acquisitions of IMMOFINANZ and S IMMO, the Group became one of Europe’s largest landlords. In 2023 we will focus on integration, optimisation, and reducing leverage.”
The Group fully consolidates the assets, liabilities, and equity of IMMOFINANZ and S IMMO. Income-related measures are reported proportionately, reflecting the acquisition timing during 2022.
Highlights of the 2022 financial year include:
Notable events occurring after the end of 2022
Financing activity
On 6 March 2023, the Group signed a €100 million unsecured term loan with MUFG with a five-year maturity. In keeping with CPIPG’s commitment to reduce the greenhouse gas (“GHG”) emissions intensity of our property portfolio by 32.4% through 2030 versus the 2019 baseline, the loan’s margin will step up or step down on an annual basis from 2023 onwards.
On 31 March 2023, the Group signed a £35 million five-year secured loan with Rothschild & Co. against a portion
of our UK assets.
CPIPG remains in active discussion with banks about secured loans in Germany, the Czech Republic, Poland, the UK and other geographies.
Disposals
In January 2023, our subsidiary S IMMO sold a commercial park near Munich. In March 2023, S IMMO sold a large residential portfolio in Berlin. In March 2023, IMMOFINANZ sold an office property in Vienna.
In total, the Group signed disposals in Q1 2023 of about €400 million.
Therefore, the Group has achieved over €750 million of gross disposal proceeds since August 2022, when CPIPG announced a disposal pipeline exceeding €2 billion to be executed over the following 12 to 24 months.
CPIPG still has more than 30 disposal projects in execution, with about €1 billion of letters of intent signed.
ESG rating upgrade
On 24 February 2023, CPIPG announced that the Group had received a rating of BBB (on a scale of AAA – CCC) in the MSCI ESG Ratings assessment, an improvement from the previous rating of BB. Key drivers for the higher rating were the larger share of certified green buildings, green leases, and enhanced corporate governance.
Annual results webcast
CPIPG will host a webcast in relation to its financial results for 2022. The webcast will be held on Thursday, 6 April 2023 at 11:00 am CET / 10:00 am UK.
Please register for the webcast in advance via the link below:
https://edge.media-server.com/mmc/p/2e5qbxvh
FINANCIAL HIGHLIGHTS
Performance 2022 2021 Change Total revenues € million 1,282 664 93.1% Gross rental income (GRI) € million 749 402 86.3% Net rental income (NRI) € million 632 363 74.1% Net hotel income € million 46 14 230.0% Net business income (NBI) € million 676 385 75.3% Consolidated adjusted EBITDA € million 608 368 64.9% Funds from operations (FFO) € million 355 254 40.1% Net profit for the period € million 557 1,292 (56.9%) Assets 31-Dec-2022 31-Dec-2021 Change Total assets € million 23,521 14,369 63.7% Property portfolio € million 20,855 13,119 59.0% Gross leasable area sqm 6,784,000 3,667,000 85.0% Share of green certified buildings* % 32.1 24.2 7.9 p.p. Occupancy % 92.8 93.8 (1.0 p.p.) Like-for-like gross rental growth** % 7.6 3.3 4.3 p.p. Total number of properties*** No. 855 367 133.0% Total number of residential units No. 16,767 11,755 42.6% Total number of hotel rooms**** No. 7,810 7,025 11.2% * According to GLA
** Based on gross rent, excluding one-time discounts in 2021, CPIPG standalone
*** Excluding residential properties in the Czech Republic
**** Including hotels operated, but not owned by the Group
Financing structure 31-Dec-2022 31-Dec-2021 Change Total equity € million 9,263 7,695 20.4% EPRA NRV (NAV) € million 8,005 7,039 13.7% Net debt € million 10,625 4,682 127.0% Net Loan-to-value ratio (Net LTV) % 50.9 35.7 15.2 p.p. Net debt/EBITDA x 17.5x 12.7x 4.8x Secured consolidated leverage ratio % 19.5 9.8 9.7 p.p. Secured debt to total debt % 38.9 27.0 11.9 p.p. Unencumbered assets to total assets % 54.4 70.4 (16.0 p.p.) Unencumbered assets to unsecured debt % 179% 267% (88.0 p.p.) Net ICR x 3.2x 4.6x (1.4x)
CONSOLIDATED INCOME STATEMENT
631.8 362.9 Development sales - 12.9 Development operating expenses - (9.4) Net development income - 3.5 Hotel revenue 165.1 66.4 Hotel operating expenses (119.6) (52.6) Net hotel income
Revenues from other business operations 45.5 13.8 Other business revenue 53.2 43.6 Other business operating expenses (54.8) (38.4) Net other business income (1.6) 5.2 Total revenues 1,281.9 663.8 Total direct business operating expenses (606.2) (278.4) Net business income 675.7 385.4 Net valuation gain/(loss) (88.8) 1,275.8 Net gain on disposal of investment property and subsidiaries 35.9 34.5 Amortization, depreciation and impairment (99.5) (52.0) Administrative expenses (128.7) (58.4) Other operating income 331.8 6.5 Other operating expenses (24.9) (5.8) Operating result 701.5 1,586.0 Interest income 20.3 17.9 Interest expense (210.2) (97.3) Other net financial result 151.3 39.3 Net finance costs (38.6) (40.1) Share of gain of equity-accounted investees (net of tax) 19.1 15.1 Profit before income tax 682.0 1,561.0 Income tax expense (124.8) (269.4) Net profit from continuing operations 557.2 1,291.6
Net rental income
Net rental income increased by €269.0 million (74.1%) to €631.8 million in 2022 primarily due to the acquisitions of IMMOFINANZ and S IMMO (€191.8 million and €58.2 million, respectively).
Net hotel income
In 2022, net hotel income improved to €45.6 million, an increase of €31.8 million (230%) due to the recovery of travel demand across Europe.
Net valuation gain
In 2022, the net valuation loss of €88.8 million, primarily due to the acquisitions of IMMOFINANZ and S IMMO generated losses of €111.8 million and €107.4 million, respectively. On the other hand, valuation gains were generated mainly by the Czech residential portfolio (€107.0 million)
The moderate decline in valuations of less than 1% reflects the Group’s diverse portfolio of higher-yielding assets coupled with CPIPG’s ability to increase rents as an offset against higher yield requirements.
Other operating income
In 2022, the Group realized other operating income of €331.8 million. Of the amount, bargain purchase related to acquisition of IMMOFINANZ and S IMMO was €189.3 million and €129.1 million, respectively.
Interest expense
Interest expense increased by €112.9 million to €210.2 million in 2022 due to the acquisition of IMMOFINANZ (€64.4 million) and S IMMO (€15.9 million) and overall increase of bank loans and bonds issued.
Other net financial result
The other net financial result reflects primarily a change in fair value on derivative instruments (€163.1 million).
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Total assets
Total assets increased by €9,152.2 million (64.7%) to €23,521.2 million at 31 December 2022 compared to 31 December 2021. The increase was driven primarily by investment property acquisitions, development costs and other additions (€8,669.6 million) and increase of cash and cash equivalents due to IMMOFINANZ and S IMMO (€660.3 million).
Total liabilities
Total liabilities increased by €7,583.8 million (113.6%) to €14,258.2 million at 31 December 2022 compared to 31 December 2021, largely due to incremental debt issuance (€2,215.7 million) and IMMOFINANZ and S IMMO acquisitions (€2,246.0 million and €988.1 million, respectively).
The increase of deferred tax liability was primarily due to acquisitions of IMMOFINANZ and S IMMO (€318.7 million and €262.2 million, respectively).
EQUITY AND EPRA NRV
Total equity increased by €1,568.3 million to €9,262.9 million as at 31 December 2022. The movements of equity components were mainly as follows:
Increase due to the profit for the period of €557.2 million (profit to the owners of €457.0 million); Decrease due to share buy-back €190.3 million; Increase in revaluation and hedging reserve in total of €56.1 million; Increase in translation reserve of €64.5 million; Increase from transactions with NCI in total of €1,184.2 million Decrease due to issuance and repayment of perpetual notes net of €102.3 million.EPRA NRV was €8,005 million as at 31 December 2022, representing increase of 13.7% compared to 31 December 2021. The increase of EPRA NRV was driven by the above changes in the Group’s equity attributable to the owners (increase of retained earnings and other reserves).
31 December 2022 31 December 2021 Equity attributable to the owners (NAV) 6,580 5,992 Effect of exercise of options, convertibles and other equity interests - - Diluted NAV 6,580 5,992 Fair value of financial instruments (243) - Deferred tax on revaluations 1,711 1,090 Goodwill as a result of deferred tax (43) (43) EPRA NRV (€ million) 8,005 7,039
For disclosures regarding Alternative Performance Measures used in this press release please refer to our Annual Management Report 2022, chapters Glossary of terms, Key ratio reconciliations and EPRA performance; accessible at http://cpipg.com/reports-presentations-en.
Audited documents will be available tonight at the following link:
http://www.cpipg.com/reports-presentations-en
2022 audited financial report
2022 audited management report
For further information please contact:
Investor Relations
David Greenbaum
Chief Financial Officer
d.greenbaum@cpipg.com
Moritz Mayer
Manager, Capital Markets
m.mayer@cpipg.com
For more on CPI Property Group, visit our website: www.cpipg.com
Follow us on Twitter (CPIPG_SA) and LinkedIn
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1598885 31.03.2023 CET/CEST