Castellana Properties Socimi S A : ends its second year of listing with an EBITDA of €44 million, up 58%

• The company achieved a Gross Rental Income of €56 million in its past financial year, which runs from 1 April 2019 to 31 March 2020

• Castellana Properties holds 18 assets in its portfolio, including shopping centres, retail parks and offices, with a gross leasable area of 373,419 sqm

• Occupancy reached 98.3% at the end of March 2020, as a result of 165 leases being signed during the year

• Castellana Properties has made significant progress with its value-added projects in the former spaces occupied by El Corte Inglés in Los Arcos, Bahía Sur and El Faro, with over 85% of the area already pre-let.

Castellana Properties has published its results for its previous financial year ending on the 31st March 2020. The company has achieved an EBITDA of €44 million, an increase of 58% on the previous year, and a net profit of €17.1 million. Funds from Operations (FFO) is €40.5 million, 96% above the previous year.

Gross rental income (GRI) was €56 million for the year, 63% more than the previous year and an increase of 2.78% on a like-for-like basis. Similarly, in the last fiscal year the Board of Directors of Castellana Properties agreed to distribute €40.4 million to its shareholders, with a standardized dividend of €0.47 per share, representing 99% of the FFO.

Castellana Properties currently holds 18 assets in its portfolio, predominantly shopping centres, and retail parks along with two small office buildings, comprising a total gross leasable area of 373,419 sqm. The Gross Asset Value (GAV) exceeds €1.003 billion and the Net Asset Value (NAV) is €559 million (€6,48 per share). In addition, the net debt is currently €448 million, with a net loan to value (LTV) ratio of 44.68%.

After the return to normality post the Covid-19 pandemic, 100% of the company's assets have been reopened with strict health and safety measures in place with all the assets having resumed trading. Castellana Properties has implemented a Covid-19 protocol with over 200 health and hygiene measures, social distancing, and customer awareness campaigns in each of its shopping centres to guarantee maximum health and safety for employees and customers. In addition, the company has undertaken many initiatives to welcome back its tenants and customers and thank them for their trust placed in the centres, by providing them with sanitary material and information including masks and gloves, signage on doors and floors and continuous communication at its centres to make their experience at the centres as satisfactory as possible. Thus, in less than a month and with mobility restrictions still in place, almost 65% of the footfall has been recovered with respect to the previous year. The customer response in all centres has been very positive.

Assets are close to 100% occupancy

Occupancy at the end of March 2020 was 98.3%. Likewise, in the last 12 months the company has signed 165 leases, of which 101 were new contracts and 64 were renewals, all of which have generated an additional net operating income (NOI) of €5.4 million and have led to an increase in the average rental per square meter of these leases of 10.84%.

Over the last year, Castellana Properties portfolio value has increased, driven mainly by the strategic acquisition of new properties and the active management of the company's portfolio. Regarding valuations at 30 September 2019, Castellana Properties considered it necessary to impact its valuations due to the potential effect of the Covid-19 pandemic which has resulted in a decline of 2.4%, with the portfolio still remaining above €1 billion.

Castellana Properties is currently undertaking projects to reposition and expand leisure, restaurants and commercial areas in Bahía Sur, Los Arcos and El Faro, where it will increase the offering and open new business units. 85.3% of the GLA of these projects is already been committed by tenants and, in total, the estimated capex for these projects amounts to €29 million.

Regarding footfall, Castellana Properties has recorded very good data throughout 2019, with an increase in footfall of 3.9%, 6 basis points above the national average. Sales have also improved over the period by 0.8%, in line with the national benchmark. If we exclude Bahía Sur and Los Arcos shopping centres, due to the refurbishment work currently underway, footfall is up 10% and sales improved by 1.5%, which demonstrates the active management of the portfolio and Castellana´s ongoing commitment to generate value for its shareholders.

Acquisitions that demonstrate the commitment to retail

Over the last financial year, Castellana made three new acquisitions which amounted to €97.2 million, which demonstrates its firm commitment to retail in Spain. The fund acquired Puerta Europa Shopping Centre in Algeciras, El Corte Inglés boxes in Los Arcos and Bahía Sur shopping centres and Phase II of Pinatar Park in Murcia.

Alfonso Brunet, CEO of Castellana Properties, states that 'we are very proud to be able to announce once again such extraordinary results for the company, which demonstrate the result of a job well done. The next few months we will continue to work along the same lines and, given the strength of the company, the robust financial results and an outstanding team of professionals, we will overcome this situation. At Castellana we believe that knowing how to adapt to change and reinvent ourselves is a guarantee of success and we are committed to this. In order to achieve this, we will go hand in hand with our tenants, and with mutual support we will continue to promote omnichannel and digitalization in our shopping centres, which is one of the pillars of the future of the sector'.