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AUDITED CONDENSED CONSOLIDATED FINANCIAL RESULTS FOR THE YEAR TO 30 JUNE 2023
AND CHANGES TO THE BOARD OF DIRECTORS AND COMPANY SECRETARY
MAS P.L.C. Registered in Malta Registration number: C99355
JSE share code: MSP ISIN: VGG5884M1041 LEI code: 213800T1TZPGQ7HS4Q13 (MAS, the Company or the Group)
INTRODUCTION AND BACKGROUND The variance in MAS’ adjusted total earnings compared to the six months to 31 December 2022, is mostly due to positive outcomes ASSET SALES IN WE
MAS (hereafter referred to as the Group or Company) performed well during the second half of the financial year ended arising from: MAS’ remaining Western European assets held for sale are Flensburg Galerie (Germany) and Arches street retail units (UK).
30 June 2023, achieving adjusted distributable earnings for the year of 8.93eurocents per share (a 30.7% increase from adjusted (i) continued outstanding performance of, and increase in, NRI from retail properties in CEE, enhanced by excellent rental and These assets had a combined fair value of €58.8million with €33.5million secured bank debt outstanding on 30 June 2023.
distributable earnings per share for the previous financial year). This strong performance was driven by stellar operational results service charge collections and exceptional trading at commercial centres operated by MAS; A promising sales process for Flensburg Galerie was ongoing, in parallel with a debt refinancing process for the bank loan secured
in commercial retail properties operated by the Group. By contrast, the current market uncertainties and increased interest rate (ii) losses recognised in the previous period resulting from an increase in management’s estimate for disposal realisation costs on the property, maturing in November 2023. The sales transaction was recently aborted, as the potential buyer did not secure
environment have brought about various challenges, with ramifications affecting both MAS and the development joint venture and losses for Western European assets remaining to be sold, as well as from foreign exchange losses related to the disposal appropriate funding to complete the transaction. Management continues the process of securing debt to refinance (or extend) the
(DJV1) with developer Prime Kapital. In respect of the latter, notwithstanding the strong fundamentals of the residential business, of UK properties (Langley Park land), not being repeated, and property’s existing debt.
this segment of operations is facing headwinds. (iii) increased income from preferred equity, resulting from additional investments during the current and previous six-month The competitive sales process for the Arches street retail units is continuing, and the asset is expected to be disposed of in the six
Changes with respect to the funding environment have effects on multiple areas of the business, specifically due to the cost and periods. months to December 2023.
availability of secured and unsecured debt. As communicated on 29 June 2023, MAS’ board of directors (Board) was undertaking These positives have been partially offset by (i) decreases in dividends and value of MAS’ investment in listed securities following Valuations of income properties held for sale in WE on 30 June 2023 have further decreased. Management’s estimate of expected
a comprehensive process of reviewing the Company’s strategy and committed to announce the outcome of the review with the disposals in the current and previous six months; (ii) lower, still favourable, increases in Central and Eastern European property realisation costs and potential losses on disposal of €19.9million on 30 June 2023 has not changed significantly compared to
release of the financial results for the period to 30 June 2023. Following the strategic review, where the Board considered at length valuations; (iii) decreases in MAS’ interest rate derivatives’ market value, and (iv) net losses derived from the DJV’s residential €21.3million on 31 December 2022. The estimate had been re-assessed from €4.2million on 30 June 2022. Management’s
the macroeconomic challenges with respect to the debt markets, it has resolved a more conservative and proactive approach is business caused by a challenging residential sales market environment requiring the DJV to recognise a decrease in net realisable estimation includes costs likely to crystalise on disposal of the assets in WE, including early bank debt repayment penalties, relevant
required at this stage. For this reason, the Board deems it prudent to pause distributions and accumulate liquidity to provide for a value for some of its completed residential properties. advisory and agency fees, and other related costs and losses.
more robust capital structure that can meet the operating requirements of the business in a more challenging funding environment.
OPERATIONS LISTED SECURITIES
The aforementioned points, and the Group’s financial results are elaborated in detail within.
There was excellent trading in all Central and Eastern European countries where the Group operates during the first six months of On 30 June 2023, MAS held shares in NEPI Rockcastle N.V. (NRP), to the value of €36.5million. During the six months to
the 2023 calendar year, with all the Group’s properties benefiting from robust footfall and tenant sales. MAS progressed well with 30 June 2023, the Group disposed of 10,953,418 shares, at a realised gain of €0.9million compared to the weighted average
PREAMBLE asset management initiatives aimed at achieving previously stated asset management targets. acquisition price, and €0.4million realised loss compared to fair values on 31 December 2022.
In addition to the reported International Financial Reporting Standards (IFRS) results, this commentary also includes segmental
reporting prepared on a proportionate consolidated basis, which assists the interpretation of the former rather than replacing Information regarding MAS’ Central and Eastern European like-for-like (LFL) footfall and tenants’ sales (compared to the same Total adjusted returns from this investment during the six months to 30 June 2023 were €0.7million, of which €2.9million were
it. Detailed financial results and the Company Profile, for the year ended 30 June 2023, including highlights and supplemental period of the previous financial year), and collection rates for the six months to 30 June 2023, is detailed in Table 1. Figures in respect accrued dividend returns for the period and €2.2million unrealised fair value losses. After financial year end, the remaining
of January to March 2023 benefit from, and reflect, a lower comparative base as social distancing restrictions were in place up to investment was fully disposed of, at a realised profit of €1.1million (compared to 30 June 2023).
operational information, are available on MAS’ corporate website. Unless otherwise stated, all amounts in the Directors’ March 2022. All figures were reported on 31 August 2023.
commentary are presented on an adjusted proportionate consolidated basis.
Table 1 DEVELOPMENTS, EXTENSIONS, AND REFURBISHMENTS IN THE DJV
MAS primarily invests in, and operates, retail assets in Central and Eastern Europe (CEE). The Group is well positioned to leverage
the region’s long-term, continual, high growth in consumption and generate strong like-for-like (LFL) net rental income (NRI) Jan 23 Feb 23 Mar 23 Apr 23 May 23 Jun 23 Total The DJV’s secured commercial development pipeline on 30 June 2023 is estimated at €889.9million at cost (figure not proportionally
growth from retail holdings through increasing tenants’ sales and implementing asset management initiatives. MAS benefits from consolidated). Progress with commercial and residential developments and changes to secured commercial development pipeline
Footfall (2023 compared to 2022) % 139 134 118 110 109 110 118
downside-protected exposure to retail and residential developments via the DJV with developer Prime Kapital. are detailed below.
Open-air malls % 138 133 121 112 111 112 119
MAS remains committed to maximising total long-term returns from property investments on a per share basis. This is aimed Enclosed malls % 141 136 113 107 106 107 116 Completed commercial developments
to be achieved by concentrating on capital allocation, operational excellence, sensible leveraging, and cost efficiency, thereby Tenants’ sales per m2 (2023 compared to 2022) % 129 125 115 108 107 111 114 Slobozia Value Centre extension, adjacent to MAS’ directly owned property, was completed, and opened on 31 May 2023. The
sustainably growing distributable earnings per share. Benefiting from the continual high growth in Central and Eastern European Open-air malls % 123 121 115 109 109 109 114 extension complements the existing centre with 4,300m2 additional retail GLA. This represents the third such extension completed
consumption, the Group operates directly owned income property and employs capital in commercial and residential developments Enclosed malls % 143 134 113 106 103 113 116 during the financial year to 30 June 2023, with Baia Mare and Roman Value Centres’ respective extensions completed during the
owned indirectly via the DJV with co-investor and developer Prime Kapital. Collection rate % 100 100 100 100 99 99 100 six months to 31 December 2022. The extensions enhance the existing open-air malls’ retail offering and safeguard their dominant
positions in the relevant catchment areas.
OUTCOME OF STRATEGY REVIEW Overall LFL footfall for the six months to 30 June 2023 was 9% above the same period in 2019, and tenants’ turnovers per m2 Carolina Mall was completed and opened as planned on 31 August 2023 with 92% of the 29,000m2 GLA occupied. The mall is in
It is expected that real GDP and consumption growth in Romania will endure, and that long-term growth in Romania and other CEE significantly exceeded pre-pandemic levels by 28%, both in enclosed malls (29% increase) and in open-air malls (27% increase). Alba Iulia, the capital of Romania’s Alba County, with a population of approximately 75,000 and approximately 228,000 residents
countries will continue to remain robust and significantly surpass growth in Western European countries for the foreseeable future. in the mall’s catchment area. The city’s only modern retail centre, Carolina Mall, introduced remarkable entertainment and leisure
As such, the Group expects to generate best-in-class, sustainable, long-term total shareholder returns. Footfall performance was admirable for the six months to 30 June 2023, increasing 18% compared to the same period in the previous facilities, including a 1ha new park built for the local community, as well as a diverse retail offering of high-quality national and
year. This strong improvement in footfall confirms the continued robust demand for the Group’s retail offering. international tenants to the region.
MAS published, with the release of the Group’s 30 June 2021 financial statements, four quantified strategic objectives set to be Overall, LFL tenants’ sales outperformed levels achieved in the six-month period to 30 June 2022 by 14% in open-air malls and 16%
achieved over five years (by the end of the 2026 financial year). Their achievement would have implied an increase in scale that in enclosed malls. Most tenant categories delivered impressive sales results, in line with the growth trend. Leisure, entertainment, Commercial developments
would have positioned the Company well for an investment-grade credit rating. On this basis, the Company committed to a full services, and specialist tenants’ sales, which had a slower recovery to pre-pandemic levels, have surpassed the overall growth Construction of Arges Mall, the dominant 51,400m2 GLA regional enclosed mall continues as scheduled. Works on the bridge access
pay-out of distributable income during this period and published its ambition to achieve distributable earnings per share ranging trends during the six months to 30 June 2023. Food services, health and beauty, complements, home appliances and groceries infrastructure is ongoing, and the centre is scheduled to open May 2024. Leasing continues with national and international tenants
between 14.5 – 15eurocents per share by the 2026 financial year, with increases in gearing levels and profits from residential categories have continued to outperform. Toys and DIYs, categories that previously significantly outperformed pre-pandemic sales showing significant interest.
developments being core components. levels, underperformed during the six months to 30 June 2023.
Permitting of Mall Moldova, in Iasi, Romania, enhanced to incorporate a revised layout and reconfigured infrastructure, is in place.
Since formulation of these objectives, significant market changes have taken place. These affect the underlying assumptions in Passing NRI on a LFL basis increased by 6.4% compared to 31 December 2022 and by 12.4% compared to 30 June 2022. The increase The construction, extending and redeveloping Era Shopping Centre (29,600m2 GLA) into a super-regional enclosed mall, part of a
respect of debt financing cost and availability, and the achievability of the residential development targets over this period. is attributable both to higher rent indexation due to Euro inflation and to increased rental from overage because of excellent tenant retail node incorporating approximately 126,300m2 of destination GLA, is expected to commence in September 2023. Leasing is
Before the funding environment changed, MAS was well on track to meet rating agencies’ requirements for an investment grade sales’ performance. MAS’ properties benefit from Euro-based, triple-net, leases, with full Euro indexation to base (minimum) progressing well with high demand from national and international tenants.
rated real estate company. An investment grade credit rating would have facilitated refinancing the Group’s issued bond in the rents and turnover clauses. MAS fully passes on indexation to tenants, which have comfortably absorbed the higher rents, while
occupancy cost ratios (OCR) have remained healthy due to the continued strong tenants’ sales. Construction for the first phase of Silk District office is on track to complete by 30 September 2023, and consents required for
capital markets, providing MAS with flexible access to debt finance at optimal cost, which is integral to long-term strategy. Despite permitting of the following two phases, are in place.
the Group’s strong operating performance, Moody’s has downgraded MAS’ corporate issuer, and bond, credit rating to Ba2 from OCRs (excluding certain tenant categories: supermarkets, DIYs, entertainment, and services) to 30 June 2023 were stable at 10.7%
Ba1 in July 2023, primarily because of the current challenging funding environment for real estate companies. Appetite for below (10.6% on 31 December 2022). This was achieved despite higher absolute occupancy costs brought about by increased service Zoning is ongoing for the DJV’s commercial projects in Bucharest (28,000m2 GLA open-air mall component on 54ha of a former
investment grade bond issues has declined considerably and the associated cost of new bond funding has increased substantially. charges and rent indexation of 9.5% applied since January 2023. Stable OCRs highlight tenants’ excellent sales performance. industrial platform, where a mixed-use urban regeneration project is planned), Brasov (24,400m2 GLA open-air mall) and Cluj
Consequently, collection rates were exceptional at over 99.6% for the entire six-month period. (73,300m2 GLA enclosed mall and 49,200m2 GLA office components on a 17ha land plot where the DJV plans a large-scale
This means that potential issuers of such bonds may either have difficulty raising debt capital and/or may have to pay exorbitant
mixed-use urban regeneration project).
interest rates to attract investors, which could affect their profitability and creditworthiness. In addition, occupancy of Central and Eastern European assets increased to 97.3% on 30 June 2023 (96.3% on 31 December 2022),
and leasing efforts focused on sustainably achieving MAS’ long-term strategic asset management target of 99% occupancy are Several other retail development opportunities are being pursued, some of which have been secured.
It is unlikely MAS will achieve, as previously planned, an investment grade credit rating well in advance of its bond maturity in May
2026. It is also expected that interest rates will remain at higher levels for longer than previously anticipated, which has a direct ongoing. Residential developments
impact on appropriate debt levels. As such, alternative funding sources are required to ensure repayment of the existing bond at At Flensburg Galerie (Germany), asset management initiatives to prepare the asset for disposal have been substantially completed At the Avalon Estate residential project, construction and finishing works on the first buildings were substantially complete on
(or before) maturity. and resulted in a significant increase in retail occupancy to 91.9% (from 81.7% on 30 June 2021, when the initiatives commenced). 30 June 2023. To date, 73% of the 352 first phase residential units have been sold and 52% of units sold have been handed over to
Accordingly, MAS has reconsidered the Group’s capital structure and revised its self-imposed, long-term overall debt limit The property’s occupancy on 30 June 2023, including office GLA, stood at 86.0%. Passing NRI increased by 23.5%, to €2.9million clients.
downwards. More restrictive than its covenant tolerances, MAS’ overall debt will from now on be limited to a maximum LTV of since 30 June 2021. The property’s overall appeal in its catchment area increased, as evidenced by footfall levels for the six months
to 30 June 2023 increasing by 11%, and tenants’ sales increasing by 17% compared to the same period in 2022. Construction and sales of the first two phases of Silk District’s residential component (315 units; 82% sold and 346 units; 81% sold,
35% (decreased from 40%). The Group’s limitation of net debt to a maximum of seven is targeted to decrease to six times net rental respectively) is progressing well. First phase units’ handovers to clients are expected to commence by 31 December 2023 and by
income (computed on a forward-looking basis). These tighter limits will be monitored and adhered to on both an IFRS and on a Residential operations reflected a €0.5million loss for the six months to 30 June 2023, included in MAS’ adjusted distributable 30 June 2024 for the second phase units.
proportionate consolidated accounting basis. earnings, being its proportion of net results attributable to DJV’s residential business. Of this, €0.5million represents residential
profits achieved mainly through sales of Marmura Residence units during the period, offset by €1million in selling and administrative The first phase of Pleiades Residence’s construction, comprising 142 units in two of the seven buildings planned for the residential
In addition, MAS is implementing a debt management plan to raise bank funding secured against its unencumbered properties in component of the 10.1ha mixed-use urban regeneration in downtown Ploiesti, continues as scheduled. Sales are progressing, and
costs related to all residential projects and net realisable value adjustments on completed residential units at Marmura Residence.
CEE aimed at reducing refinancing risks associated with its bond maturity. To date, management has negotiated €134.8million in Profits on sales of residential units also include the first Avalon Estate units delivered prior to 30 June 2023. In respect of the latter, 44% of the first phase units have been contracted to date.
new secured bank loan funding and processes to attract an additional €45million are ongoing. Drawing down on these facilities delays in the administrative process of completing residential sales have resulted in only 11% of units sold to 30 June 2023 being Two previously disclosed residential projects in Timisoara, Spumotim Residential (approximately 2,100 apartments) and Elba
remains subject to banks’ risk and credit approval processes, final terms being agreed, and conditions precedent being fulfilled. handed over to clients by the same date. The net margin on the remaining units sold at Avalon Estate, previously scheduled for Residential (approximately 1,400 apartments) are anticipated to be removed from the DJV’s residential development pipeline.
Under the previous, more relaxed, self-imposed debt limitations, combined with MAS’ plan to utilise almost exclusively unsecured completion by June 2023 is expected to be recognised in the following six-month period.
debt in its capital structure, the Company could have maintained the full pay-out of distributable earnings. However, the adoption EXTENSIONS AND REFURBISHMENTS TO DIRECTLY OWNED ASSETS
of the above, more restrictive, debt limitations whilst implementing a debt management plan focusing on raising secured debt DEBT, COST OF DEBT AND LIQUIDITY The refurbishment of Galleria Burgas progresses as scheduled, and it is expected the planned asset management initiatives for
and maintaining a full pay-out of distributable earnings will place MAS at undue risk of not meeting its existing ongoing funding On 30 June 2023, MAS had €111.9million in cash, listed securities, and undrawn credit facilities (figures not proportionally reconfiguring the food court and improving the centre’s overall leisure and entertainment facilities will complete by 30 June 2024.
commitments. The Board has therefore resolved rather to accumulate adequate liquidity to cover the bond redemption and consolidated). On the same date, the Group’s outstanding debt amounted to €452.7million on a proportionate consolidation basis.
medium-term funding commitments as they fall due whilst simultaneously reducing anticipated overall future debt levels. The This comprised of €290.9million in unsecured bonds, €5million in drawn unsecured revolving credit facility, and €156.8million in Further updates regarding other extension and refurbishment projects to directly owned assets in CEE, will be provided when
Company will thus retain distributable earnings in full until such time as these objectives have been substantially met. secured bank loans on the Group’s properties in CEE and WE. appropriate.
Although the long-term fundamentals of the Romanian residential market remain strong, residential demand is currently suboptimal, Group’s LTV ratio on 30 June 2023 was 28.1% on a proportionate consolidation basis and 28.8% on an IFRS consolidation basis. The EARNINGS GUIDANCE
given significant increases in construction costs that placed downward pressure on margins. To this end, residential projects not weighted average cost of debt was 4.42% per annum for the financial year ended 30 June 2023 (on an IFRS consolidation basis).
currently under construction, and new phases to projects currently under development, have been placed on hold, attesting to Diluted adjusted distributable earnings per share for the 2024 financial year is expected to range from 9.81eurocents to
Covenant ratios on the Group’s bond and unsecured revolving credit facility demonstrated comfortable headroom compared to 10.65eurocents per share. This guidance is based on the assumptions that MAS implements its current debt management plan as
the value of maintaining flexibility and optionality in the DJV’s development and projects’ de-risking processes. Considering this, covenant tolerances, on both IFRS and proportionate consolidation bases, as illustrated in Table 2 below. scheduled, no additional material macroeconomic disruption occurs, a stable political environment prevails in the Group’s markets,
expected timelines, costs, and margins in respect of the residential development pipeline are no longer applicable and will not be
developments are delivered as scheduled, and no major corporate failures occur.
published. Publication of these estimates will resume when the DJV considers it appropriate to proceed with these developments. Table 2
Shareholders should note that the Company’s estimates and distributable earnings per share targets are subject to change.
Regarding unsold completed units at Avalon Estate and Marmura Residence, the DJV will retain these units for rental, addressing Tolerance Actual IFRS Actual proportionate consolidation basis Inevitably, some assumptions will not materialise, plans will change, and unanticipated events and circumstances may affect the
rising demand for quality rental stock in Bucharest, while preserving the option to sell in due course. Solvency ratio Shall not exceed 0.6 0.31 0.30 ultimate financial results. The Company will not hesitate to adopt changes in strategy, or to take action that may impact negatively
The strategic earnings targets previously set to be achieved by the end of the 2026 financial year, in respect of which excellent Consolidated coverage ratio At least 2.5:1 4.25 4.93 on distributable income per share, if this is considered appropriate from a long-term, risk-adjusted, total return perspective.
progress has been achieved to date, accounted for factors which have changed significantly since the targets had been set. This Unencumbered consolidated total assets/
unsecured consolidated total debt Minimum 180% 360% 369% This forecast has not been audited or reviewed by MAS’ auditors and is the responsibility of the Board.
includes debt funding to be raised closer to the Group’s previous self-imposed debt limitations (no longer appropriate due to
the adoption of more conservative debt limitations) and significantly scaling up the residential development business over this CHANGES TO THE BOARD AND COMPANY SECRETARY
period (no longer appropriate due to current unfavourable residential market dynamics). As a result, the strategic earnings target FUNDING COMMITMENTS TO THE DJV
previously set in respect of the 2026 financial year, is withdrawn. MAS is pleased to announce the appointment of Stefan Briffa as Company Secretary, taking over Roxana Bordeanu’s company
By 30 June 2023, MAS has invested a total of €319.9million in preferred equity and revolving credit facility and had ongoing undrawn
secretarial responsibilities, with effect from 31 August 2023. Stefan has extensive experience in Maltese Company Law and
commitments to the DJV of €180.1million, of which €19.5million in undrawn revolving credit facility (figures not proportionally
consolidated). has recently joined the Group’s head office in Malta. Stefan has over 27 years’ experience in regulatory affairs, compliance, and
FINANCIAL RESULTS corporate governance. Prior to joining MAS, he worked as company secretary and head of risk and compliance at major Maltese
Group adjusted total earnings are, on a segmented basis, the combined return of: (i) directly-owned income property and operations groups activating in vehicle retail and mobility, telecommunications, and corporate services. Roxana remains a member of senior
in CEE; (ii) Central and Eastern European investments with Prime Kapital in the DJV (including earnings from a proportion of PROPERTY VALUATIONS management and will continue to focus on her responsibilities as part of MAS’ Capital Management team, particularly on the
completed DJV-owned income properties, net income from the DJV’s residential business, development activities and income from The income property fair value uplift of €14.2million reflects positive fair value adjustments to income property in CEE of implementation of MAS’ debt management plan. The Board thanks her for her dedicated service during her tenure as Company
funding provided to the DJV); (iii) the remaining directly-owned income property operations in Western Europe (WE), and (iv) €15.5million (an improvement of 1.5% compared to the valuations on 31 December 2022 and 4.6% compared to 30 June 2022) and Secretary.
investments in listed securities and other elements disclosed as Corporate. a decrease of €1.3million in WE (a decrease of 1.4% compared to 31 December 2022, mainly driven by an increase in the valuation
discount rate used for Flensburg Galerie). Dan Petrisor, originally appointed as Alternate Director on 28 February 2020, and as Executive Director on 30 August 2021, steps
Adjusted total earnings for the six months to 30 June 2023 were €41.2million and consisted of adjusted distributable earnings down from the Board as Executive Director effective 31 August 2023. He remains a senior executive of the Group and will continue
of €29.7million and adjusted non-distributable earnings of €11.5million. Tangible net asset value (NAV) was €1.45 per share Valuations of MAS’ (and the DJV’s) properties are determined biannually by external, independent professional valuers, with to concentrate on his duties in respect of Capital Management and Investor Relations. The Board expresses their gratitude for Dan’s
on 30 June 2023, a marginal increase from 31 December 2022 (3.6% increase from Tangible NAV on 30 June 2022). Adjusted appropriate, recognised qualifications and recent experience in the relevant location and category of property. Valuations are dedicated service during his time on the Board.
distributable earnings for the financial year were 8.93eurocents per share (30.7% increase compared to financial year to 30 June primarily based on discounted forecast cash flows and are therefore forward-looking.
2022) and resulted from 4.51eurocents per share for the six months to 30 June 2023 and 4.42eurocents per share for the preceding Income property fair value gains were a result of passing NRI increases on a LFL basis of 6.4% since December 2022 (12.4% since Irina Grigore
six months. MAS achieved diluted adjusted distributable earnings for the financial year of 8.80eurocents per share. Of this, June 2022) driven by strong operational performance, partially offset by the impact of an increase in discount rates applied. The Chief Executive Officer
commercial and corporate operations contributed 8.82eurocents per share, in line with the attributable earnings guidance range of weighted average unlevered discount rate for income property valuations in CEE slightly increased to 9.94% from 9.91% compared Nadine Bird 31 August 2023, Malta
8.75 – 9.00eurocents per share provided in March 2023. to valuations for the six months to 31 December 2022 (and from 9.71% on 30 June 2022). Chief Financial Officer Released on 4 September 2023
1
DJV is an abbreviation for a separate corporate entity named PKM Development Ltd (PKM Development), an associate of MAS since 2016 with independent governance. MAS owns 40% of PKM (i) is not permitted to undertake real estate development in CEE outside of PKM Development until the DJV’s capital commitments are fully drawn and invested or 2030 (end of exclusivity period);
Development’s ordinary equity (€20million), an investment conditional on it irrevocably undertaking to provide preferred equity to PKM Development on notice of drawdown. By 30 June 2023, (ii) contributes secured development pipeline to PKM Development at cost;
MAS had invested €309.5million in preferred equity and had an obligation of €160.5million outstanding. In addition, MAS has committed to provide PKM Development a revolving credit facility of (iii) takes responsibility for sourcing further developments, and
€30million at a 7.5% fixed rate, of which €19.5million was undrawn on 30 June 2023 (figures not proportionally consolidated). The balance of the ordinary equity in PKM Development (€30million) (iv) provides PKM Development with all necessary construction and development services via an integrated in-house platform.
was taken up by Prime Kapital in 2016 in cash. In terms of applicable contractual undertakings and restrictions, Prime Kapital:
All amounts in € thousand unless otherwise stated.
CONDENSED CONSOLIDATED STATEMENT Audited Audited SEGMENTAL ANALYSIS Proportionate accounts Adjustments Adjusted proportionate accounts
OF FINANCIAL POSITION 30 Jun 23 30 Jun 22 INCOME STATEMENT (JAN – JUN 2023) Six months to 30 Jun 2023 Six months to 30 Jun 2023 Six months to 30 Jun 2023
Non-current assets 1,280,460 1,141,198 Total CEE DJV WE Co** Total CEE DJV WE Co Total CEE DJV WE Co
Current assets 193,565 388,402 EARNINGS 26,690 25,713 13,206 (2,191) (10,038) 14,551 11,973 (613) 1,442 1,749 41,241 37,686 12,593 (749) (8,289)
Total assets 1,474,025 1,529,600 DISTRIBUTABLE EARNINGS 31,145 26,317 10,002 513 (5,687) (1,376) – (1,238) – (138) 29,769 26,317 8,764 513 (5,825)
Equity attributable to owners of the Group 964,656 928,150 Net rental income – income property 33,097 31,101 750 1,246 – – – – – – 33,097 31,101 750 1,246 –
Total equity 964,656 928,150 Net income – residential property (524) – (524) – – – – – – – (524) – (524) – –
Non-current liabilities 441,850 450,826 Net income – preferred equity and revolving credit facility 6,512 – 6,512 – – – – – – – 6,512 – 6,512 – –
Current liabilities 67,519 150,624 Net dividends – listed securities 4,583 – 1,238 – 3,345 (1,657) – (1,238) – (419) 2,926 – – – 2,926
Total liabilities 509,369 601,450 Net corporate expenses (3,167) (1,083) (83) (261) (1,740) – – – – – (3,167) (1,083) (83) (261) (1,740)
Total shareholder equity and liabilities 1,474,025 1,529,600 Interest on debt financing (10,053) (2,530) – (453) (7,070) – – – – – (10,053) (2,530) – (453) (7,070)
Interest capitalised on developments 2,047 – 2,047 – – – – – – – 2,047 – 2,047 – –
Other distributable net income/(cost) 259 (65) 68 (9) 265 281 – – – 281 540 (65) 68 (9) 546
Audited Audited Income tax (1,609) (1,106) (6) (10) (487) – – – – – (1,609) (1,106) (6) (10) (487)
CONDENSED CONSOLIDATED Year to Year to
NON–DISTRIBUTABLE EARNINGS (4,455) (604) 3,204 (2,704) (4,351) 15,927 11,973 625 1,442 1,887 11,472 11,369 3,829 (1,262) (2,464)
STATEMENT OF PROFIT OR LOSS 30 Jun 23 30 Jun 22
Fair value adjustments – income property 14,235 11,675 3,864 (1,304) – – – – – – 14,235 11,675 3,864 (1,304) –
Continuing operations
Fair value adjustments – interest rate derivatives (281) (263) (20) – 2 – – – – – (281) (263) (20) – 2
Rental income 62,836 36,344
Fair value adjustments – listed securities (2,599) – – – (2,599) 419 – – – 419 (2,180) – – – (2,180)
Service charge income and other recoveries 20,203 11,575
Foreign currency exchange differences (16) – – – (16) – – – – – (16) – – – (16)
Gross revenue 83,039 47,919
Investment expenses (825) (43) (53) (462) (267) 379 – – 379 – (446) (43) (53) (83) (267)
Impairment of receivables (127) (338)
Share-based payment expense (10,108) (9,760) – – (348) 10,108 9,760 – – 348 – – – – –
Service charge and other property operating expenses (22,756) (13,478)
Other non-distributable income/(cost) 35 – 38 – (3) – – – – – 35 – 38 – (3)
Net rental income 60,156 34,103
Tax on sale of property (265) – – (265) – – – – – – (265) – – (265) –
Corporate expenses (6,740) (6,564)
Deferred tax (4,631) (2,213) (625) (673) (1,120) 3,958 2,213 625 – 1,120 (673) – – (673) –
Other income 10,097 5,006
Estimation for WE disposal realisation costs and losses – – – – – 1,063 – – 1,063 – 1,063 – – 1,063 –
Investment expenses (931) (1,858)
Weighted average adjusted number of shares (million) 660.3
Fair value adjustments 44,636 61,223
Diluted weighted average adjusted number of shares (million) ~ 670.4
Foreign currency exchange differences (2,208) (770)
Adjusted distributable earnings per share (eurocents) 4.51
Share of profit from equity-accounted investee, net of tax 4,315 40,901
Diluted adjusted distributable earnings per share (eurocents) 4.44
Impairment of share-based payment prepayments (9,624) –
Profit before finance income/(costs) 99,701 132,041
Finance income 20,628 21,733
Finance costs (19,071) (15,256)
SEGMENTAL ANALYSIS Proportionate accounts Adjustments Adjusted proportionate accounts
Profit before tax 101,258 138,518 BALANCE SHEET (JUN 2023) 30 Jun 2023 30 Jun 2023 30 Jun 2023
Current tax (4,165) (872)
Total CEE DJV WE Co** Total CEE DJV WE Co Total CEE DJV WE Co
Deferred tax (6,379) (6,832)
NET ASSET VALUE 964,656 770,620 364,411 51,449 (221,824) (3,719) 32,806(16,637) (19,888) – 960,937 803,426 347,774 31,561 (221,824)
Profit from continuing operations 90,714 130,814
ASSETS 1,510,948 944,599 401,341 89,573 75,435 (22,517) (2,947)(19,570) – – 1,488,431 941,652 381,771 89,573 75,435
Discontinued operations
Income property 979,056 896,390 23,856 58,810 – – – – – – 979,056 896,390 23,856 58,810 –
Profit from discontinued operations, net of tax 118 10,357
Developments – income property 70,769 5,120 65,649 – – – – – – – 70,769 5,120 65,649 – –
Profit for the year 90,832 141,171
Developments – residential property 75,526 – 75,526 – – – – – – – 75,526 – 75,526 – –
Attributable to:
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