MITTEILUNG UEBERMITTELT VON BUSINESS WIRE. FUER DEN INHALT IST ALLEIN
DAS BERICHTENDE UNTERNEHMEN VERANTWORTLICH.
EPRA NNNAV: EUR80.1 per share (up 21.0%)
Property portfolio value: EUR6,229 million (up 12.6% like-for-like)
Rental income: EUR195.8 million (up 3.6% like-for-like)
EPRA earnings: EUR102.4 million (up 1.5%)
Attributable net profit: EUR685.3 million
PARIS --(BUSINESS WIRE)--09.02.2018--
The financial statements for the year ended 31 December 2017 were approved by
the Board of Directors of Société Foncière Lyonnaise (Paris:FLY) on
9 February 2018 at a meeting chaired by Juan-José Brugera.
Business indicators were very robust, thanks to the high portfolio occupancy
rate and growth in rental income, while the year also saw further strong gains
in the portfolio's appraisal value and the Company's net asset value.
The auditors have completed their audit of the annual financial information and
are in the process of issuing their report.
'Our 2017 performance validates our value creation strategy of investing in
prime office property in the most attractive districts of Paris and creating a
high value for users via an exceptional standard of amenities,' commented
Nicolas Reynaud, Chief Executive Officer of SFL.
|Consolidated data (EUR millions)
|Adjusted operating profit*
|Attributable net profit
|* Operating profit before disposal gains and
||losses and fair
|Consolidated portfolio value excluding
|Consolidated portfolio value including
|EPRA NNNAV per share
Results: robust operating profit and growth in net profit driven by an increase
in the portfolio value
Rental income amounted to EUR195.8 million in 2017, down by a modest EUR2.4 million
or 1.2% from the EUR198.1 million reported in 2016.
* On a like-for-like basis (excluding all changes in the portfolio affecting
year-on-year comparisons), rental income was EUR6.2 million higher, a 3.6%
increase that was attributable to new leases signed in 2016 and 2017,
mainly for the Cézanne Saint-Honoré, 9 Percier and 103 Grenelle properties.
* Changes in assets under redevelopment between the two periods had a EUR2.6
million negative impact on rental income, with several floors of offices in
the Cézanne Saint-Honoré complex and other properties taken off the market
for extensive renovation after their tenants moved out.
* The sale of the IN/OUT building on 29 September 2017 led to EUR3.3 million
decrease in rental income compared with 2016.
* Lastly, lease termination penalties received from tenants added a net EUR0.5
million to rental income in 2017 compared with EUR3.2 million in 2016.
Operating profit before disposal gains and losses and fair value adjustments to
investment properties amounted to EUR164.1 million in 2017 versus EUR169.7 million
The portfolio's appraisal value grew by 12.6% over the year on a like-for-like
basis. The increase led to the recognition of positive fair value adjustments
to investment properties of EUR635.1 million in 2017 (versus EUR438.0 million in
2016). Profit for the year was also boosted by the EUR80.3 million gain realised
on the sale of the IN/OUT building.
Net finance costs continued to fall sharply, amounting to EUR40.7 million in 2017
compared with EUR48.1 million in 2016. Recurring finance costs were down by EUR4.7
million in 2017, reflecting SFL's lower average refinancing costs and the
reduction in its total debt.
After taking into account these key items, the Group reported attributable net
profit for the year of EUR685.3 million versus EUR504.1 million in 2016. Excluding
the impact of disposals, changes in fair value of investment properties and
financial instruments and the related tax effect, EPRA earnings amounted to
EUR102.4 million in 2017 versus EUR100.9 million the year before (an increase of
Business review: increase in rental income, low vacancy rate, and a pipeline of
In a growing rental market, shaped by the lowest vacancy rate in the Paris
region since 2007, stronger corporate demand and a shortage of available high
quality properties, especially in Paris itself, SFL signed a large number of
leases in 2017 representing a total surface area of some 21,000 sq.m.
Highlights of the year included:
* Leasing of the entire 2,900 sq.m. of vacant space in the 103 Grenelle
property to two tenants, Edouard Denis Développement and Calvin Klein.
* Leasing of 3,500 sq.m. of offices in the Cézanne Saint-Honoré complex to
LEK Consulting and KBL Richelieu.
* Leasing of 2,800 sq.m. in the Washington Plaza complex to various tenants.
* Leasing of a 3,400 sq.m. unit in the 92 Champs-Elysées building to WeWork.
* Leasing of retail space in Galerie des Champs-Elysées for the new concept
store opened by l'Occitane and Pierre Hermé in December 2017.
Nominal office rents for leases signed in 2017 averaged EUR733 per sq.m. with
effective rents averaging EUR629 per sq.m, illustrating SFL's ability to leverage
the quality and scarcity of its products to keep rents high while maintaining a
disciplined approach to rental incentives.
The physical occupancy rate for revenue-generating properties at 31 December
2017 was 96.4%, compared with 97.0% at the previous year-end. At 3.1%, the EPRA
vacancy rate was stable over the year, further illustrating the outstanding
attractiveness of the SFL portfolio and the Group's ability to maintain full
occupancy of its properties.
In January 2017, SFL entered into a EUR165 million deal to acquire SMA's
historical headquarters building, a 21,000 sq.m. property located at 112-122
avenue Emile Zola in the 15^th arrondissement of Paris. SFL acquired title to
the property in November 2017 when SMA moved out. The building stands on a
6,300 sq.m. plot featuring a tree-filled garden. It dates back to 1966 and will
be completely remodelled.
On 29 September 2017, the IN/OUT building located at 46 Quai Alphonse le Gallo
in Boulogne-Billancourt was sold to Primonial REIM. The 35,000 sq.m. building
was completely remodelled in a project launched in 2011. Since 2015, it has
been leased in full to OECD under a lease expiring in 2027. The building was
sold for EUR445 million excluding transfer costs, generating a capital gain of
EUR80.3 million that was recognised in 2017.
Capital expenditure for 2017 amounted to EUR32.8 million and mainly concerned the
renovation of vacated floors in existing buildings and building redevelopment
projects. The development pipeline at 31 December 2017 concerned around 13% of
the Group's portfolio and consisted mainly of three flagship projects that will
be deployed over the next four years, as follows:
* The core of the Louvre Saint-Honoré complex, representing some 15,000 sq.m.
of retail space.
* The office complex on avenue Emile Zola acquired in 2017, which will be
completely remodelled to become a major business centre in the heart of the
15^th arrondissement of Paris.
* The 9,000 sq.m. building at 96 avenue d'Iéna, which will be extensively
renovated to offer services meeting the very highest standards.
Financing: historically low debt and average borrowing costs
Net debt at 31 December 2017 amounted to EUR1,631 million (compared with EUR1,931
million at 31 December 2016), representing a loan-to-value ratio of 24.6%. At
31 December 2017, the average cost of debt after hedging was 1.7% and the
average maturity was 4.5 years.
In 2017, the remaining EUR301 million worth of November 2012 bonds was redeemed
and two new 6- and 7-year revolving bank lines of credit totalling EUR250 million
were obtained for general corporate purposes.
At 31 December 2017, SFL had EUR760 million in undrawn back-up lines of credit
that are available to finance investment opportunities and cover the Group's
In October 2017, Standard & Poor's upgraded SFL's rating to BBB+ with a stable
Net Asset Value: portfolio value tops EUR6 billion
The consolidated market value of the portfolio at 31 December 2017 was EUR6,229
million excluding transfer costs versus EUR5,736 million at 31 December 2016,
representing an increase of 8.6% as reported and 12.6% on a like-for-like
basis. This further increase in appraisal values primarily reflects the upward
pressure of narrower investment market yields for prime properties and the
Group's improved lease terms.
The average EPRA topped-up net investment yield (NIY) stood at 3.2% at 31
December 2017, compared with 3.6% at 31 December 2016.
EPRA NNNAV stood at EUR3,729 million or EUR80.1 per share at 31 December 2017, an
increase of 21.0% compared to EUR66.2 per share at 31 December 2016.
At the Annual General Meeting to be held on 20 April 2018, the Board of
Directors will recommend paying a dividend of EUR2.30 per share.
Alternative Performance Indicators (APIs)
API EPRA earnings
|Attributable net profit
|Profit (loss) on asset disposals
|Non-recurring disposal costs
|Fair value adjustments to investment properties
|Fair value adjustments to financial instruments,
|discounting adjustments to debt and related costs
|Tax on the above items
|Non-controlling interests in the above items
API EPRA NNNAV
|Unrealised capital gains
|Fair value adjustments to fixed rate debt
API Net debt
|Long-term borrowings and derivative instruments
|Short-term borrowings and other interest-bearing debt
|Debt in the consolidated statement of financial position
|Current account advances (liabilities)
|Accrued interest and deferred recognition of debt
|Cash and cash equivalents
More Information is available at www.fonciere-lyonnaise.com
Leader in the prime segment of the Parisian commercial real estate market,
Société Foncière Lyonnaise stands out for the quality of its property
portfolio, which is valued at EUR6.2 billion and is focused on the Central
Business District of Paris (#cloud.paris, Edouard VII, Washington Plaza, etc.),
and for the quality of its client portfolio, which is composed of prestigious
companies in the consulting, media, digital, luxury, finance and insurance
sectors. As France's oldest property company, SFL demonstrates year after year
an unwavering commitment to its strategy focused on creating a high value in
use for users and, ultimately, substantial appraisal values for its properties.
Stock market: Euronext Paris Compartment A - Euronext Paris ISIN FR0000033409 -
Bloomberg: FLY FP - Reuters: FLYP PA
S&P rating: BBB+ stable outlook
View source version on businesswire.com: http://www.businesswire.com/news/home/
Thomas Fareng, Phone +33 (0)1 42 97 27 00
Grégoire Silly, Phone +33 (0)1 45 63 49 73
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