Press Release
Luxembourg, 29 May 2020
CPI FIM SA reports financial results for the first quarter of 2020
CPI FIM SA (hereinafter “CPI FIM”, the “Company” or together with its subsidiaries the “Group“), a real estate group with a property portfolio primarily located in the Czech Republic and Poland, hereby publishes unaudited financial results for the first quarter of 2020.
As at 31 March 2020, CPI PROPERTY GROUP S.A. (hereinafter also the “CPIPG”, and together with its subsidiaries the “CPIPG Group”) directly owns 97.31% of the Company shares (97.31% voting rights).
Financial highlights
Performance | Q1-2020 | Q1-2019 | Change | ||
Gross rental income | € thousands | 8,897 | 322 | 2,661% | |
Total revenues | € thousands | 16,608 | 7,583 | 119% | |
Operating result | € thousands | 10,041 | 3,258 | 208% | |
Net profit/(Loss) for the period | € thousands | (80,658) | 14,166 | (669%) | |
Assets | 31-Mar-20 | 31-Dec-19 | Change | ||
Total assets | € thousands | 5,707,618 | 5,244,046 | 9% | |
EPRA NAV | € thousands | 713,498 | 864,644 | (17%) | |
Property Portfolio | € thousands | 1,171,000 | 1,193,000 | (2%) | |
Gross leasable area | sqm | 174,000 | 174,000 | 0% | |
Occupancy in % | % | 91.5% | 93.0% | (1.5 p.p.) | |
Land bank area | sqm | 18,068,000 | 18,068,000 | 0% | |
Total number of properties | No. | 8 | 8 | 0% | |
Financing structure | 31-Mar-20 | 31-Dec-19 | Change | ||
Total equity | € thousands | 855,700 | 997,878 | (14%) | |
Equity ratio | % | 15% | 19% | (4 p.p.) | |
Income statement
€ thousands | 31-Mar-20 | 31-Mar-19 | ||
Gross rental income | 8,897 | 322 | ||
Sale of services | 7,711 | 7,261 | ||
Cost of service charges | (2,749) | (892) | ||
Property operating expenses | (2,060) | (260) | ||
Net service and rental income | 11,799 | 6,431 | ||
Total revenues | 16,608 | 7,583 | ||
Total direct business operating expenses | (4,809) | (1,152) | ||
Net business income | 11,799 | 6,431 | ||
Net valuation gain on investment property (net of foreign exchange) | - | - | ||
Net gain/(loss) on the disposal of investment property and subsidiaries | (2) | 248 | ||
Amortization, depreciation and impairments | 1,039 | (277) | ||
Administrative expenses | (2,403) | (3,179) | ||
Other operating income | 2 | 29 | ||
Other operating expenses | (394) | 6 | ||
Operating result | 10,041 | 3,258 | ||
Interest income | 38,631 | 34,424 | ||
Interest expense | (32,107) | (15,188) | ||
Other net financial result* | (96,460) | (4,844) | ||
Net finance income/(cost) | (89,936) | 14,392 | ||
Profit/(Loss) before income tax | (79,895) | 17,650 | ||
Income tax expense | (763) | (3,484) | ||
Net Profit/(Loss) for the period | (80,658) | 14,166 |
* Including net foreign exchange gains and losses (including valuation gains classified within valuation gain under IFRS), share of profit of equity accounted investees and other financial gains and losses.
Gross rental income
In 2020, gross rental income increased due to the Group’s acquisition of offices in Warsaw, Poland during 2019. Similarly, there was an increase in cost of service charges and property operating expenses.
Interest income and expense
Interest income increased from €34.4 million to €38.6 million in the three months period ended 31 March 2020. The increase reflects the increase of loans provided by the Group to related parties. Interest expense increased from €15.2 million to €32.1 million the three months ended 31 March 2020. The increase reflects the increase of loans received by the Group primarily from the parent company.
Other net financial result
Other net financial result in the three-months ended 31 March 2020 represented primarily:
- foreign exchange losses of €147.6 million from retranslation of the loans provided to related parties in foreign currencies; and
- the valuation gain of €51.4 million due to retranslation of the Group’s portfolio valued in EUR but denominated in foreign currencies (CZK, HUF and PLN).
Balance sheet
€ thousands | ||||||
31-Mar-20 | 31-Dec-19 | |||||
NON-CURRENT ASSETS | ||||||
Intangible assets | 12 | 1,123 | ||||
Investment property | 1,169,501 | 1,191,435 | ||||
Property, plant and equipment | 660 | 662 | ||||
Equity accounted investees | 3,481 | 3,672 | ||||
Other investments | 184,183 | 188,293 | ||||
Loans provided | 3,724,305 | 3,442,619 | ||||
Trade and other receivables | 12 | 12 | ||||
Deferred tax assets | 153,116 | 153,126 | ||||
Total non-current assets | 5,235,270 | 4,980,942 | ||||
CURRENT ASSETS | ||||||
Inventories | 423 | 341 | ||||
Income tax receivables | 203 | 36 | ||||
Trade receivables | 10,233 | 7,175 | ||||
Loans provided | 120,854 | 103,908 | ||||
Cash and cash equivalents | 165,448 | 129,447 | ||||
Other current assets | 173,789 | 20,693 | ||||
Assets held for sale | 1,398 | 1,504 | ||||
Total current assets | 472,348 | 263,104 | ||||
TOTAL ASSETS | 5,707,618 | 5,244,046 | ||||
EQUITY | ||||||
Equity attributable to owners of the Company | 675,210 | 826,356 | ||||
Non-controlling interests | 180,490 | 171,522 | ||||
Total equity | 855,700 | 997,878 | ||||
NON-CURRENT LIABILITIES | ||||||
Financial debts | 4,435,906 | 3,886,792 | ||||
Deferred tax liabilities | 36,257 | 38,200 | ||||
Provisions | 1,482 | 1,594 | ||||
Other financial liabilities | 10,194 | 10,794 | ||||
Total non-current liabilities | 4,483,839 | 3,937,380 | ||||
CURRENT LIABILITIES | ||||||
Financial debts | 317,117 | 252,538 | ||||
Trade payables | 4,866 | 10,543 | ||||
Income tax liabilities | 612 | 747 | ||||
Other current liabilities | 45,465 | 44,939 | ||||
Liabilities held for sale | 19 | 21 | ||||
Total current liabilities | 368,079 | 308,788 | ||||
TOTAL EQUITY AND LIABILITIES | 5,707,618 | 5,244,046 |
Total assets and total liabilities
Total assets increased by €463.6 million (8.8%) to €5,707.6 million as at 31 March 2020, the majority of which was due to an increase of long-term loans provided to CPIPG.
Total liabilities increased by €605.8 million (14.3 %) to €4,851.9 million as at 31 March 2020. The increase was driven by additional drawdowns of loans to CPIPG of €549.0 million.
EPRA Net Asset Value
The EPRA Net Asset Value per share as at 31 March 2020 is €0.54 compared to €0.66 as at 31 December 2019.
The EPRA Triple NAV as at 31 March 2020 is €0.51 per share compared to €0.63 as at 31 December 2019.
The calculation is in compliance with the EPRA (European Public Real Estate Associations) “Triple Net Asset Value per share”.
31-Mar-20 | 31-Dec-19 | |||
Consolidated equity | 675,210 | 826,356 | ||
Deferred taxes on revaluations | 38,288 | 38,288 | ||
EPRA Net asset value | 713,498 | 864,644 | ||
Existing shares (in thousands) | 1,314,508 | 1,314,508 | ||
Net asset value in EUR per share | 0.54 | 0.66 | ||
EPRA Net asset value | 713,498 | 864,644 | ||
Deferred taxes on revaluations | (38,288) | (38,288) | ||
EPRA Triple Net asset value | 675,210 | 826,356 | ||
Fully diluted shares | 1,314,508 | 1,314,508 | ||
Triple net asset value in EUR per share | 0.51 | 0.63 |
In 2020, the consolidated equity decreased by €151 million. The main driver of the decrease was a loss for the period of €90 million and decrease of translation and revaluation reserve of €61 million.
For more information please refer to our website at www.cpifimsa.com.
Investors contact:
David Greenbaum, Managing Director
Tel: + 352 26 47 67 1
Fax: + 352 26 47 67 67
Email: generalmeetings@cpifimsa.com
GLOSSARY
The Group presents alternative performance measures (APMs). The APMs used in this press release are commonly referred to and analysed amongst professionals participating in the Real Estate Sector to reflect the underlying business performance and to enhance comparability both between different companies in the sector and between different financial periods. APMs should not be considered as a substitute for measures of performance in accordance with the IFRS. The presentation of APMs in the Real Estate Sector is considered advantageous by various participants, including banks, analysts, bondholders and other users of financial information:
- APMs provide additional helpful and useful information in a concise and practical manner.
- APMs are commonly used by senior management and Board of Directors for their decisions and setting of mid and long-term strategy of the Group and assist in discussion with outside parties.
- APMs in some cases might better reflect key trends in the Group’s performance which are specific to that sector, i.e. APMs are a way for the management to highlight the key value drivers within the business that may not be obvious in the consolidated financial statements.
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EPRA Net Asset Value per share
EPRA Net Asset Value per share is defined as EPRA NAV divided by the diluted number of shares at the end of period.
EPRA NAV
EPRA NAV is a measure of the fair value of net assets assuming a normal investment property company business model. Accordingly, there is an assumption of owning and operating investment property for the long term. For this reason, deferred taxes on property revaluations and the fair value of deferred tax liabilities are excluded as the investment property is not expected to be sold and the tax liability is not expected to materialize. In addition, the fair value of financial instruments which the company intends to hold to maturity is excluded as these will cancel out on settlement. All other assets including trading property, finance leases, and investments reported at cost are adjusted to fair value. The performance indicator has been prepared in accordance with best practices as defined by EPRA (European Public Real Estate Association) in its Best Practices Recommendations guide, available on EPRA’s website (www.epra.com).
Equity ratio
Equity Ratio provides a general assessment of financial risk undertaken. It is calculated as Total Equity divided by Total Assets.
Gross Leasable Area
Gross leasable area (GLA) is the amount of floor space available to be rented. Gross leasable area is the area for which tenants pay rent, and thus the area that produces income for the property owner.
Occupancy rate
The ratio of leased premises to total GLA.
Property Portfolio
Property Portfolio covers all properties held by the Group, independent of the balance sheet classification, from which the Group incurs rental or other operating income.
APM reconciliation
Equity ratio reconciliation (€ thousands) | 31-Mar-20 | 31-Dec-19 |
Total equity | 855,700 | 997,878 |
Total assets | 5,707,618 | 5,244,046 |
Equity ratio | 15% | 19% |
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