Icade Sa · EURONEXT:ICAD
Icade Sa — FY2014 Earnings Presentation
41 slides from Icade Sa's earnings presentation, Feb 18, 2015
Slide 1: 2014 Full-year results
2014 Full-year results February 18th, 2015 Tour EQHO (La Défense, 92)
Slide 2: Disclaimer
Disclaimer This presentation is not an offer or a request for an offer to sell or exchange securities, or a recommendation to subscribe, buy or sell Icade securities. Distribution of this document may be limited in certain countries by legislation or regulations. As a result, any person who comes in
Slide 3: Contents
Contents 1. Governance 2. 2014 results 2.1. A year of success 2.2. A year of transition 2.3. Outlook Appendices 3 2014 Full-year results February 18th, 2015
Slide 4: 1. Governance
Millénaire 3 & 4 (Paris 19e) 1. Governance Photo Fernando Urquijo
Slide 5: Change in the governance
1. GOVERNANCE Change in the governance Following Serge Grzybowski’s resignation announced on February, 17th 2015, the Board of directors of Icade has put in place, on a temporary basis, a new governance scheme: The functions of Chairman and Chief Executive Officer are dissociated Jean-Paul Faugère,
Slide 6: 2. 2014 results
Sisley (Saint-Denis, 93) 2. 2014 results Photo Fernando Urquijo
Slide 7: 2.1. A year of success
Panorama T6 (Paris 13th) 2.1. A year of success Photo Fernando Urquijo 2014 Full-year results
Slide 8: Contrasting market conditions
2.1. A YEAR OF SUCCESS Change in take-up Contrasting market conditions in the Paris region Sluggish economic growth (in millions of m²) Real GDP growth of 0.4% expected for 2014 3,0 0.8% expected for 2015 2,5 3.0 +13% Depressed job market Rise in unemployment 2,0 2.5 9.9% in the 3rd quarter of 2014
Slide 9: Remarkable lease signings
2.1. A YEAR OF SUCCESS Remarkable lease signings Rental income EQHO (La Défense, 92) Stable like-for-like 60,000 m² (i.e. 80% of vacant space let to KPMG, (€m) Banque de France, Air Liquide and UBAF) Tour Initiale (La Défense, 92) +2.0 5,600 m² to Tarkett +122.8 -17.7 -2.2 Millénaire 2 (Paris, 75) 2
Slide 10: Well-steered asset sales
2.1. A YEAR OF SUCCESS At 31 December 2006 Well-steered asset sales Total portfolio value Strategic and To refocus the portfolio €4,388m alternative Mr Bricolage portfolio Offices and land in Germany 48% (c) To take advantage of market appetite Link building At 31 December 2014 Representing a total
Slide 11: Resilient diversification in residential development
2.1. A YEAR OF SUCCESS Resilient diversification in residential development MARKET SHARE Increase in number of reservations MAINTAINED of 8.5% in a continuing strained market First-time buyers: 31% DIVERSIFIED CLIENT BASE Individual investors: 33% Institutional investors: 36% INCREASE Average price
Slide 12: Major development projects secured
2.1. A YEAR OF SUCCESS Major development projects secured LE GARANCE (Paris 20th) Offices, nursery and school Space: 30,000 m2 Architects: Brigitte Métra and Partners PANORAMA T6 (Paris 13th) Offices Space: 15,000 m2 Architect: Marc Mimram PUSHED SLAB (Paris 13th) MONTPELLIER Offices TGV STATION Spa
Slide 13: Consolidation of Icade Santé's market-leading position
2.1. A YEAR OF SUCCESS 2,351 1,887 Consolidation of Icade Santé’s 1,725 Portfolio value 158 market-leading position 1,317 130 829 Annualised €390.5m of acquisitions 536 661 86 114 recurrent producing immediate cash flow 56 rental 45 income 19 Acquisition of 3 clinics 2008 2009 2010 2011 2012 2013 20
Slide 14: Pro-active management of liabilities
2.1. A YEAR OF SUCCESS Pro-active management of liabilities LTV within guidance (a) ICR increased (d) 52.0 (b) 4.0x 3.5x 3.6x 4.7x 40.3% 3.3x 37.5%(c) 36.9% 36.7% 2.0 (b) 36.2% 31/12/2012 30/06/2013 31/12/2013 30/06/2014 31/12/2014 31/12/2012 30/06/2013 31/12/2013 30/06/2014 31/12/2014 Average debt
Slide 15: Greater diversification of financial resources
2.1. A YEAR OF SUCCESS Greater diversification Other liabilities of financial resources Mortgage loans 1.0% and CBI 20.0% Bonds 31.1% To capitalise on favourable market conditions Implementation of a commercial papers programme Success of a second €500m seven-year bond issue in April Private placeme
Slide 16: Guidance respected or even exceeded
2.1. A YEAR OF SUCCESS Guidance respected or even exceeded EPRA Earnings from property investment Cost of debt per share 3.07% €3.66 (-76 bp) (+6.4%) LTV Occupancy rate 89.2%(a) 36.9% (-60 bp) (a) Pro forma number of leases signed in EQHO 16 2014 Full-year results February 18th, 2015
Slide 17: EPRA Earnings from property investment
2.1. A YEAR OF SUCCESS EPRA Earnings from property investment (€ per share) +0.31 +0.09 +0.05 -0.23 +6.4% 3.44 3.66 31/12/2013 Property Activité Foncière Net depreciation Charges Savings inde Économies Tax savings Économies 31/12/2014 investment d'amortisssement charges résultat financier net financ
Slide 18: Group net current cash flow
2.1. A YEAR OF SUCCESS Group net current cash flow (€ per share) +0.32 +0.14 -0.23 -0.21 4.28 +0.7% 4.31 31/12/2013 Property Activité Foncière Other Autres activités Savings inde Économies Tax savings Économies 31/12/2014 investment activities résultat financier net financial d'impôts items 18 2014
Slide 19: 2.2. A year of transition
Future Veolia head office (Aubervilliers, 93) 2.2. A year of transition Photo Fernando Urquijo 2014 Full-year results
Slide 20: Investing in the future
2.2. A YEAR OF TRANSITION Investing in the future VEOLIA (Aubervilliers, 93) Capex of Works completed in 2016 (a) €205.9 m Investment of €41m in 2014 MILLÉNAIRE 3 (Paris 19th) 32,000 m² due to be completed in 2015 let entirely to the French Ministry of Justice Investment of €47m MILLÉNAIRE 4 (Paris
Slide 21: Non-uniform yield compression
2.2. A YEAR OF TRANSITION Non-uniform yield compression Annual change in portfolio value on a like-for-like basis Implied yields (excl. transfer duties) (c) Offices, France -3.1% +1.4% 6.9% 7.1% Business parks -2.2% +2.8% 7.9% 7.9% Healthcare -0.9% +3.4% 6.9% 6.8% TOTAL -2.3% +2.4% 7.4% 7.4% Busines
Slide 22: EPRA NAVs
2.2. A YEAR OF TRANSITION EPRA NAVs (€ per share) 78.9 EPRA NAV -0.6% 78.4 +3.0 +0.2 +1.6 -1.4 -0.2 -0.7 +2.2 +0.1 77.3 -1.6 75.2 -3.7 EPRA NNNAV -2.7% ANR EPRA EPRA Impactof Impact Impôts différés Deferred ANR EPRA Dividende EPRA 20142014Consolidated Résultat net Variation Change deinla Variation C
Slide 23: Priority given to addressing vacancy
2.2. A YEAR OF TRANSITION Priority given to addressing Occupancy rate as at 31/12/2014 vacancy 100% Target occupancy rate of over 90% nearly achieved 95% thanks to Teams in permanent contact with tenants and prospects 90% Alternative strategies to address structural vacancy • Disposals 85% • Reconve
Slide 24: Leases reaching expiry well anticipated
2.2. A YEAR OF TRANSITION Leases reaching expiry well anticipated €m €m 100 120 90 100 80 80 70 60 60 50 40 40 58% 82% 30 20 20 0 10 2015 2016 0 2015 2016 2017 2018 2019 2020 2021 2022 2023 >2023 Leases (value) under negotiation (a) Leases (value) already secured Offices Business parks Healthcare Wa
Slide 25: Reorganisation of the Group's structure
2.2. A YEAR OF TRANSITION Silic operational synergies Reorganisation of the Group’s (€m) structure -1.5 Advisory and legal fees Integration of Silic complete Legal fees 92% On an operating level: • Staff integrated • Systems merged -1.1 IT, telecoms • Synergies in progress Sundries 100% Disputes set
Slide 26: CSR Environmental certifications
2.2. A YEAR OF TRANSITION CSR Environmental certifications All new properties have at least HQE® Construction certification since and 2005 HQE® Exploitation certification since 2009 (or even double BREEAM® certification) 76% of Icade parks were ISO 14001 certified in 2014 with a target of 100% in 20
Slide 27: CSR Examples and urban and social changes
2.2. A YEAR OF TRANSITION CSR Examples and urban and social changes • Property investment o Car pooling (100% electric vehicles) in use at 1/4 commercial and office parks Personal o 31% of sites offer concierge services and 9% offer fitness facilities services • Property development o Car pooling (1
Slide 28: 2.3. Outlook
Black Swans (Strasbourg, 67) 2.3. Outlook Photo Fernando Urquijo Résultats annuels 2014 18 février 2015
Slide 29: An adaptable model
2.3. OUTLOOK An adaptable model Icade Santé Prime offices and Options to crystallise business parks value creation Increasing the value of land reserves and rotating the office portfolio Secondary business parks Disposals of mature Icade Promotion assets protecting Positioning values to be specified
Slide 30: A value-creating pipeline
2.3. OUTLOOK A value-creating MONET (Saint-Denis, 93) pipeline 20,700 m² Tenant: SNCF Lease term: 9 years Rent: €6.3m Icade portfolio Yield (a) : 7.1% in Paris region Completion: May 2015 Business parks VEOLIA Offices (Aubervilliers, 93) 45,000 m² Launch of the Grand Paris Express Tenant: Veolia Lea
Slide 31: A complementary pipeline ready for recovery
2.3. OUTLOOK A complementary pipeline ready for recovery Icade portfolio in Paris region Business parks POP UP (ÎLOT E) (Saint-Denis, 93) 28,300 m² Offices Rent: €8.9m Completion: Launch 30 months of the Grand Paris Express after launch 18 11, 15 15, 16, 17 14 VAUBAN OTTAWA VANCOUVER (Rungis, 94) (R
Slide 32: Potential change in EPRA Earnings from property investment
2.3. OUTLOOK Potential change in EPRA Earnings from property investment € per share €+0.5 €+0.9 €+0.3 €0.0 €+0.2 €+0.1 €-0.1 €5.6 €4.2 €3.7 EPRA Earnings Full-year effect of Launched and pre- Full-year effect of Secured potential Secured EPRA Rental Sale of remaining Unsecured Potential EPRA from pr
Slide 33: Dividend and guidance
2.3. OUTLOOK Dividend and guidance In view of its performance for the year, Icade will propose at the general shareholders’ meeting the payment of a dividend of €3.73 per share, an increase of 1.6%. The divided will be paid on 7 May 2015 In 2015 and 2016, Icade should see growth in EPRA Earnings fro
Slide 34: Q&A
Q&A
Slide 35: Appendices
Québec (Rungis, 94) Appendices Photo Fernando Urquijo 2014 Full-year results
Slide 36: Portfolio indicators
APPENDICES Portfolio indicators Portfolio value IFRS rental Remaining excluding Rentable EPRA vacancy income, committed Figures transfer duties space rate annualised lease term as at 31 December 2014 (a) (€m) (m²) (%) (€m) (years) Offices, France 3,459 576,916 20.1% (b) 171.8 4.3 Business parks 4,16
Slide 37: Yield
APPENDICES Yield (a) 11.4% 10.2% 9.0% 8.9% 8.2% 8.1% 8.0% 7.9% 7.9% 7.6% 7.6% 7.5% 7.4% 7.4% 7.3% 7.3% 7.2% 7.1% 7.1% 7.1% 6.9% 6.9% 6.9% 6.9% 6.9% 6.8% 6.8% 6.8% 6.8% 6.7% Offices, France Business parks Healthcare Non-strategic TOTAL COMMERCIAL commercial INVESTMENT PROPERTY 31/12/2011 31/12/2012 3
Slide 38: Development pipeline
APPENDICES Development pipeline Geographical Remaining investment Cost (a) Yield Project sector Space (€m) (€m) on cost Completion Pre-letting 2015 2016 2017 Pipeline launched 132,300 m² 161.1 97.0 8.7 620.6 7.5% 75% Québec Business park Rungis 11,600 m² 2.8 0.7 47.2 7.2% March 2015 - Le Monet Offic
Slide 39: French commercial property market
APPENDICES French commercial property market Commercial property commitments Rental values in France by half-year period (a) in the Paris region between 2000 and H1 2014 (a) 30 (€bn) 800 € / m² / year, excluding VAT and charges €699 25 20 15.5 600 €467 15 10.7 10 400 €294 5 0 200 2003 2004 2005 2006
Slide 40: Stable results for other activities
APPENDICES Stable results for other activities Property Development Services Inter-division TOTAL (€m) 31/12/2013 (a) 31/12/2014 31/12/2013 31/12/2014 31/12/2013 (a) 31/12/2014 31/12/2013 31/12/2014 Revenues 970.4 1,166.7 48.4 44.6 (25.8) (19.1) 993.0 1,192.3 EBITDA 44.2 55.7 4.6 1.7 0.8 (0.3) 49.6
Slide 41: Residential property development
APPENDICES Residential property development Housing reservations - Value Backlog (€m) (€m) - 18.4% + 32.7% 697 512 460 555 1 028 1 082 1 012 435 463 458 433 811 826 359 326 355 650 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 31/12/2009 31/12/2010 31/12/2011 31/12/2012 31/12/2013 31/12/2014 2009 2010 2010 2011