UNI - EN REPORT No 15/2012
PLAZA CENTERS N.V.
RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2012
SUCCESSFUL US EXIT AND DELEVERAGING BALANCE SHEET
Plaza Centers N.V. ("Plaza" / "Company" / "Group"), a leading property developer and investor with operations in Central and Eastern Europe, India and the USA, today announces its results for the six months ended 30 June 2012.
- Total assets of €1.14 billion (31 December 2011: €1.3 billion); reduction driven by completion of sale of 47 out 49 assets within US portfolio
- Revenues from operations increased by 42% to €33.7 million (30 June 2011: €23.7 million) as a result of higher rental income derived from an increased number of shopping malls operating throughout the period
- Net loss for the period of €7 million (30 June 2011: €32 million profit) arising from a primarily non-cash net finance costs of €12.9 million during the period (30 June 2011: €29.7 million income)
- Basic and diluted loss per share of €0.02 (30 June 2011 profit of: €0.11)
- Strong cash position at period end (including restricted bank deposits, short term deposits and available for sale financial assets) of €191 million (31 December 2011: €108 million) with working capital of €737 million (31 December 2011: €585 million); current cash position of circa €110 million
- Reduction in gearing with debt comprising 53% of balance sheet (31 December 2011: 59%), due to bond buybacks and US exit.
- The construction of Plaza’s first retail scheme in Serbia, Kragujevac Plaza, was completed and opened to the public on 20 March 2012. The 22,000 sqm GLA centre was 90% let on opening, since when a further 8% of space has been let and strong interest expressed in the remaining units. Kragujevac Plaza is the first shopping centre to be completed outside Serbia’s capital, Belgrade, and enjoys a catchment area of approximately 590,000 inhabitants within a 30 minute journey of the centre. Early trading has been extremely encouraging with over 800,000 visitors in the first three months
- Phase one of the Kharadi Plaza project known as "Matrix One", a 50:50 joint venture with a local partner, was completed in February 2012. Located in Pune, India, Matrix One, a 28,000 sqm GLA office, was 70% pre-sold upon opening
- Koregaon Park Plaza mall, also located in Pune, India, was completed and a successful soft public opening held on 2 March 2012. The 48,000 sqm total built area (excluding parking) shopping centre is circa 85% let, with a further 5% committed under memoranda of understanding
- During the period, Plaza’s US based joint venture, EPN Group, completed the sale of 47 of its 49 US based assets to BRE DDR Retail Holdings LLC, a joint venture between Blackstone Real Estate and DDR Corp. in a transaction valued at US$1.428 billion. The transaction generated a cash inflow for the Company of US$120 million before taxes and transaction costs, representing a return on equity of nearly 50% in little over two years.
Key highlights since the period end:
- As a part of its efforts to deleverage, the Company has disposed of the Ramstore development in Sofia, Bulgaria, therefore extinguishing €6m of bank loan debt from the balance sheet
- Following the sale of 47 US properties, EPN Group completed, after the period end, the sale of its two remaining assets for US$41.8 million out of which US$13 million was settled by assumption of debt.
Commenting on the results, Ran Shtarkman, the President and CEO of Plaza Centers, said:
"Despite challenging market conditions, Plaza has again delivered strong results for the reporting period with a 42% increase in our revenues from operations resulting from the increased number of completed shopping centres we operate and hold on our balance sheet.
"Combined with our robust financial performance, we have also been able to achieve a number of firsts for our development programme including the highly successful launch of our first shopping and entertainment centre in Serbia, Kragujevac Plaza, which has been enormously well received by the local population. We also completed our first shopping centre in India, Koregaon Park Plaza in Pune, and were highly encouraged by the success of the soft opening.
"With no imminent end to the Eurozone crisis, we remain vigilant to the potential risks to our business. However, by de-risking our development programme, maintaining a strong cash balance and working capital reserves alongside reducing our levels of gearing, Plaza is strongly positioned to weather these uncertainties and continue to deliver growth."
For further details please contact:
Ran Shtarkman, President and CEO
Roy Linden, CFO
+36 1 462 7221
+36 1 462 7222
Stephanie Highett/Daniel O’Donnell
+44 20 7831 3113
Notes to Editors
Plaza Centers N.V. (www.plazacenters.com) is a leading property developer and investor with operations in Central and Eastern Europe, India and the USA. It focuses on constructing new centres and, where there is significant redevelopment potential, redeveloping existing centres in both capital cities and important regional centres. The Company is dual listed on the Main Board of the London Stock Exchange and, as of 19 October 2007, the Warsaw Stock Exchange (LSE:"PLAZ", WSE: "PLZ/PLAZACNTR"). Plaza Centers N.V. is an indirect subsidiary of Elbit Imaging Ltd. ("EI"), an Israeli public company whose shares are traded on both the Tel Aviv Stock Exchange in Israel and the NASDAQ Global Market in the United States. Plaza Centers is a member of the Europe Israel Group of companies which is controlled by its founder, Mr Mordechay Zisser. It has been active in real estate development in emerging markets for over 16 years.
This press release may contain forward-looking statements with respect to Plaza Centers N.V. future (financial) performance and position. Such statements are based on current expectations, estimates and projections of Plaza Centers N.V. and information currently available to the company. Plaza Centers N.V. cautions readers that such statements involve certain risks and uncertainties that are difficult to predict and therefore it should be understood that many factors can cause actual performance and position to differ materially from these statements. Plaza Centers N.V. has no obligation to update the statements contained in this press release, unless required by law.