REG - Globalworth Real Est - Notice of Interim Results & Prelim Interim Results
29/08/2023 15:45
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RNS Number : 7040K Globalworth Real Estate Inv Ltd 29 August 2023
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION
FOR IMMEDIATE RELEASE
29 August 2023
Globalworth Real Estate Investments Limited
("Globalworth" or the "Company")
Notice of Interim Results & Preliminary Interim Financial Information
Globalworth announces that it intends to publish its Interim Report and
Financial Statements for the six-month period ended 30 June 2023 during the
week commencing 18 September 2023. Ahead of this publication, the Company is
today providing a preliminary release of its unaudited Consolidated Statement
of Comprehensive Income and unaudited Consolidated Statement of Financial
Position to 30 June 2023.
Key Highlights for the period ended 30 June 2023
· Total combined portfolio value decreased by 2.5% to €3.1 billion,
mainly due to revaluations and disposals
o Like-for-like appraised value of standing commercial properties decreased
to €2.8 billion (3.0% lower than 31 December 2022)
· Developments focused on high-quality logistic / light-industrial
facilities in Romania (13.3k sqm) and the refurbishment / repositioning of two
mixed-use properties in Poland aiming at increasing their class "A" office
space and improving their retail/commercial offering, in response to current
market conditions
· Completed the development of our first logistic / light-industrial
project in Targu Mures adding 18.3k sqm of spaces to our portfolio
· Overall, the standing-portfolio footprint increased by a net 17.3k
sqm to 1.4m sqm of GLA in 72 standing properties
· Leasing transactions for 181.0k sqm of commercial space taken-up or
extended at an average WALL of 6.9 years were signed despite continued
challenging market conditions
· Average standing occupancy of our combined commercial portfolio of
85.5% (85.7% including tenant options), marginally lower vs. year-end 2022 of
85.6% (85.9% including tenant options)
o Average commercial standing occupancy, adjusted for Warta Tower, which was
sold in July and was vacant as of 30 June 2023, was 87.7% (87.8% including
tenant options)
o Like-for-like occupancy decreased marginally by 0.3% mostly reflecting
excess supply conditions in our Regional Polish submarkets
· Total annualised contracted rent increased by 6.8% to €202.2
million compared to year-end 2022, of which:
o 91.5% is contracted in office and industrial properties
o 94.1% is in active leases, with the remainder 5.9% of contracted
annualised rent to commence in the future
· Like-for-like annualised commercial contracted rents in our standing
commercial portfolio increased by 5.4% to €191.0 million at the end of the
first half of 2023 compared to 31 December 2022, mainly the effect of rent
indexation
· Fitch Ratings re-affirmed, in July 2023, Globalworth's investment
grade rating and changed the outlook to negative following their 2023 annual
review of Globalworth. S&P downgraded credit rating to BB+ with a stable
outlook
· Net debt reduction of €63.5m from the Company's cash resources:
o buyback of €100m nominal value of GWI Bond 18/25 with cash consideration
of €83.2m
o repayment of €60m of the RCF facility and
o drawdown of €96.5m of asset-secured financing secured by the Company's
Romanian logistics portfolio
· Net Operating Income was higher by 5.6% compared to H1-2022 at
€73.7 million
· EPRA earnings decreased by 0.4% to €34.2 million (H1-2022: €34.3
million), partially impacted by the operating results due to higher
administrative costs and higher income tax expense (excluding deferred tax
expense on investment property) compared to the same period in 2022
· Adjusted normalised EBITDA (including the share of minority
interests) increased by 4.1% to €66.0 million (H1-2022: €63.4 million),
due to an increase in NOI partially offset by higher administrative expenses
· Loss attributable to equity holders of the Company of €25.1
million (H1-2022: profit of €32.6 million) mainly due to the fair value loss
of €103 million on investment property, which were partially net of higher
finance income and the decrease in the income tax expense
· Scrip Dividend Shares issued for 98.1% of the total share capital in
April 2023 and interim cash dividend paid to the rest of the shareholders of
€0.15 per share (total of €0.6m) in H1-2023
· Preliminary EPRA Net Reinstatement Value (NRV) of €1.8 billion, or
€7.55 per share, an 8.9% per share decrease from €8.29 on 31 December 2022
mainly due to the revaluation losses on the property portfolio and the 14
million new scrip shares issued in H1 2023
· IFRS Earnings per share of minus 11 cents in H1-2023 (H1-2022: 15
cents) as a result of the negative impact of the property revaluations
recorded
· Maintaining high levels of liquidity following the GWI 18/25 buyback
at €130.5 million plus €265 million in undrawn RCF facilities
· Maintained an LTV of 42.7 % same as that of 31 December 2022, despite
the significant negative property revaluation during H1 2023
· Sustainability:
o €2.4bn in 52 green certified properties in our portfolio
o 15 properties were certified or recertified with BREEAM Very Good or
higher certifications in the first 6 months
o Issued the fifth sustainable development report for the Group
o Maintained our "low-risk" rating by Sustainalytics and "A" rating by
MSCI
o Our environmental target to reduce GHG emissions intensity by 46% by
2030 versus our baseline 2019 levels (for Scope 1 and 2) was validated by the
globally recognised Science Based Targets initiative (SBTi)
INTERIM CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTHS ENDED 30 JUNE 2023
30 June 30 June
2023 2022
Unaudited Unaudited
€'000 €'000
Revenue 119,050 116,551
Operating expenses (45,306) (46,696)
Net operating income 73,744 69,855
Administrative expenses (7,755) (6,484)
Acquisition costs - (7)
Fair value (loss)/gain on investment property (102,884) 7,019
Share-based payment expense (167) -
Loss on disposal of subsidiary (164) -
Depreciation and amortisation expense (289) (309)
Other expenses (1,182) (720)
Other income 2,215 295
Foreign exchange (loss)/gain (569) 307
(Loss)/Gain from fair value of financial instruments at fair value through (121) 73
profit or loss
(Loss)/Profit before net financing cost (37,172) 70,029
Finance cost (27,945) (27,547)
Finance income 18,224 1,179
Share of profit of equity-accounted investments in joint ventures 2,613 2,012
(Loss)/Profit before tax (44,280) 45,673
Income tax expense 19,701 (12,245)
(Loss)/Profit for the period (24,579) 33,428
Items that will not be reclassified to profit or loss
Gain on equity instruments designated at fair value through other - 36
comprehensive income
Other comprehensive income for the period, net of tax - 36
Total comprehensive income for the period (24,579) 33,464
(Loss)/Profit attributable to: (24,579) 33,428
- ordinary equity holders of the Company (25,078) 32,606
- non-controlling interests 499 822
Total comprehensive income attributable to: (24,579) 33,464
- ordinary equity holders of the Company (25,078) 32,642
- non-controlling interests 499 822
INTERIM CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2023
30 June 31 December 2022
2023 Audited
Unaudited €'000
€'000
ASSETS
Investment property 2,864,290 2,945,460
Goodwill 12,349 12,349
Advances for investment property 6,102 4,393
Investments in joint-ventures 72,645 67,967
Equity investments 7,629 7,521
Other long-term assets 1,724 1,784
Prepayments 210 226
Deferred tax asset 5,888 161
Non-current assets 2,970,837 3,039,861
Financial assets at fair value through profit or loss 3,433 3,554
Trade and other receivables 21,919 22,337
Contract assets 4,598 9,967
Guarantees retained by tenants 99 98
Income tax receivable 371 840
Prepayments 6,679 2,430
Cash and cash equivalents 130,545 163,767
Current assets 167,644 202,993
Investment property held for sale 121,138 126,009
Total current assets 288,782 329,002
Total assets 3,259,619 3,368,863
EQUITY AND LIABILITIES
Issued share capital 1,736,955 1,704,476
Treasury shares (4,827) (4,859)
Fair value reserve of financial assets at FVOCI (5,469) (5,469)
Share-based payment reserve 156 156
Retained earnings (96,123) (37,798)
Equity attributable to ordinary equity holders of the Company 1,630,692 1,656,506
Non-controlling interests 1,361 862
Total equity 1,632,053 1,657,368
Interest-bearing loans and borrowings 1,365,191 1,433,631
Deferred tax liability 138,958 154,866
Lease liabilities 19,426 19,861
Deposits from tenants 2,894 3,897
Guarantees retained from contractors 2,834 1,995
Trade and other payables 78 1,034
Non-current liabilities 1,529,381 1,615,284
Interest-bearing loans and borrowings 24,078 21,600
Guarantees retained from contractors 4,625 3,652
Trade and other payables 32,013 35,679
Contract liability 2,126 1,743
Other current financial liabilities 50 67
Current portion of lease liabilities 2,313 1,669
Deposits from tenants 20,221 17,477
Income tax payable 468 382
Current liabilities 85,894 82,269
Liabilities directly associated with the assets held for sale 12,291 13,942
Total current liabilities 98,185 96,211
Total equity and liabilities 3,259,619 3,368,863
COMBINED CONSOLIDATED PORTFOLIO SNAPSHOT
AS AT 30 JUNE 2023
Our real estate investments are in Poland and Romania, the two largest markets
in the CEE. As at 30 June 2023, our portfolio was spread across 13 cities,
with Poland accounting for 49.8% by value and Romania 50.2%.
Combined Portfolio Snapshot (as at 30 June 2023)
Poland Romania Combined Portfolio
Standing Investments((1)) 19 23 42
GAV((2)) / Standing GAV (€m) €1,533m / €1,361m €1,547m / €1,459m €3,080m / €2,819m
Occupancy 74.7% 92.4% 85.5%
(92.6% incl. tenant options) (85.7% incl. tenant options)
WALL((3)) 4.0 years 5.8 years 4.9 years
Standing GLA (k sqm)((4)) 542.1k sqm 880.8k sqm 1,422.9k sqm
Contracted Rent (€m)((5)) €95.9m €106.2m €202.2m
GAV Split by Asset Usage
Office 81.8% 74.2% 78.0%
Mixed-Use 18.2% 0.0% 9.0%
Industrial 0.0% 18.5% 9.3%
Others 0.0% 7.2% 3.6%
GAV Split by City
Bucharest 0.0% 83.1% 41.7%
Timisoara 0.0% 6.5% 3.3%
Pitesti 0.0% 3.8% 1.9%
Constanta 0.0% 4.2% 2.1%
Arad 0.0% 1.1% 0.6%
Oradea 0.0% 0.4% 0.2%
Targu Mures 0.0% 0.9% 0.4%
Warsaw 44.9% 0.0% 22.4%
Krakow 19.8% 0.0% 9.8%
Wroclaw 16.6% 0.0% 8.3%
Katowice 11.0% 0.0% 5.5%
Lodz 4.1% 0.0% 2.1%
Gdansk 3.6% 0.0% 1.8%
GAV as % of Total 49.8% 50.2% 100.0%
1. Standing Investments representing income producing properties. One
investment can comprise multiple buildings. e.g. Green Court Complex comprises
three buildings or one investment.
2. Includes all property assets, land and development projects valued at 30
June 2023.
3. Includes pre-let commercial standing and development/re-development assets.
WALL of standing commercial properties in Romania, Poland and the Combined
portfolio are 5.8 years, 4.0 years and 5.0 years, respectively.
4. Including 21.1k sqm of residential assets in Romania.
5. Total rent comprises commercial (€192.5 million) and residential (€0.6
million in Romania) standing properties, rent in assets under refurbishment
(€8.8 million in Poland) and development pre-lets (€0.3 million in
Romania).
For further information visit www.globalworth.com (http://www.globalworth.com)
or contact:
Enquiries
Rashid Mukhtar
Group Head of Finance
Tel: +40 732
800 000
Panmure Gordon (Nominated Adviser and Joint
Broker) Tel: +44 20
7886 2500
Dominic Morley
About Globalworth / Note to Editors:
Globalworth is a listed real estate company active in Central and Eastern
Europe, quoted on the AIM-segment of the London Stock Exchange. It has become
the pre-eminent office investor in the CEE real estate market through its
market-leading positions both in Poland and Romania. Globalworth acquires,
develops and directly manages high-quality office and industrial real estate
assets in prime locations, generating rental income from high quality tenants
from around the globe. Managed by over 250 professionals across Cyprus,
Guernsey, Poland and Romania the combined value of its portfolio is €3.1
billion, as at 30 June 2023. Approximately 96.9% of the portfolio is in
income-producing assets, predominately in the office sector, and leased to a
diversified array of over 700 national and multinational corporates. In Poland
Globalworth is present in Warsaw, Wroclaw, Lodz, Krakow, Gdansk and Katowice,
while in Romania its assets span Bucharest, Timisoara, Constanta, Pitesti,
Arad, Oradea and Targu Mures.
IMPORTANT NOTICE: This announcement has been prepared for the purposes of
complying with the applicable laws and regulations of the United Kingdom and
the information disclosed may not be the same as that which would have been
disclosed if this announcement had been prepared in accordance with the laws
and regulations of any jurisdiction outside of the United Kingdom. This
announcement may include statements that are, or may be deemed to be,
"forward-looking statements". These forward-looking statements may be
identified by the use of forward-looking terminology, including the terms
"targets", "believes", "estimates", "plans", "projects", "anticipates",
"expects", "intends", "may", "will" or "should" or, in each case, their
negative or other variations or comparable terminology, or by discussions of
strategy, plans, objectives, goals, future events or intentions. These
forward-looking statements include all matters that are not historical facts
and involve predictions. Forward-looking statements may and often do differ
materially from actual results. Any forward-looking statements reflect the
Company's current view with respect to future events and are subject to risks
relating to future events and other risks, uncertainties and assumptions
relating to the Company's business, results of operations, financial position,
liquidity, prospects, growth or strategies and the industry in which it
operates. Forward-looking statements speak only as of the date they are made
and cannot be relied upon as a guide to future performance. Save as required
by law or regulation, the Company disclaims any obligation or undertaking to
release publicly any updates or revisions to any forward-looking statements in
this announcement that may occur due to any change in its expectations or to
reflect events or circumstances after the date of this announcement.
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