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SHORT-FORM ANNOUNCEMENT: AUDITED CONDENSED CONSOLIDATED FINANCIAL RESULTS FOR THE YEAR TO 30 JUNE 2022
AND CHANGES TO THE BOARD OF DIRECTORS
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 ASSET SALES IN WE CHANGES TO THE BOARD OF DIRECTORS AND COMPANY SECRETARY
MAS (hereafter referred to as the Group or Company) continued performing very well during the second half of the financial year ended MAS’ remaining Western European assets held for sale are Flensburg Galerie (Germany), Arches street retail units and Langley Park (UK). Since the transaction with Prime Kapital in November 2019 and the appointment of Prime Kapital founders Martin Slabbert and Victor
30 June 2022, achieving adjusted total earnings of €76.7million. Adjusted total earnings for the entire financial year were €168.1million. These assets had a combined book value of €78.5million with €34.1million secured bank debt outstanding on 30 June 2022. Semionov as Executive Directors, MAS has achieved excellent progress in its transition towards becoming a fully focused Central and Eastern
The Group achieved adjusted distributable earnings per share for the year of 6.83eurocents per share (15.2% above adjusted distributable MAS has contracted the disposal of the development land at Langley Park for £20.2million to a local property developer, Vistry Partnerships European property investor and operator. The terms of the transaction included a mandate of up to three years for the appointed executives
earnings per share for the previous financial year) and is on track to achieve its strategic objectives set until end of the 2026 financial year. The to oversee the re-positioning and transitioning of the business before returning full-time to Prime Kapital. With the transition substantially
Group’s financial results and progress with strategic matters are discussed within. Limited, subject to the receipt of planning consent for the developer’s envisaged project. This is expected to be received by 31 December completed, Martin and Victor stepped down. Martin remains a member of MAS’ Board of Directors as a Non-Executive Director. MAS’ pre-
2022, with proceeds payable in two instalments (approximately half on receipt of the planning consent, with the balance payable on the first existing and ongoing business relationship with Prime Kapital via the DJV was extended, after Martin stepped down as CEO, via the Extension
In addition to the reported International Financial Reporting Standards (IFRS) results, this commentary also includes segmental reporting anniversary of the transaction’s closing date). Flensburg Galerie, where asset management initiatives are progressing well, and the Arches
prepared on a proportionate consolidated basis, which assists the interpretation of the former rather than replacing it. Detailed financial approved by an overwhelming majority of MAS’ independent shareholders (96.69%). This is expected to continue having a major positive
results and Company Profile, updated on 30 June 2022, including highlights and supplemental operational information, are available on MAS’ street retail units are planned to be disposed of in competitive sales processes commencing September 2022. impact on the Group’s future financial performance.
corporate website. Unless otherwise stated, all amounts are presented on an adjusted proportionate consolidated basis. Valuations of income properties held for sale in WE on 30 June 2022 have further decreased, as has management’s estimate of expected With MAS’ Executive Director roles assigned to individuals with no affiliation to, or interest in, Prime Kapital, allowing the two groups to
MAS’ primary business is the investment in, and operation of, retail assets in Central and Eastern Europe (CEE). The Group, with its sales proceeds. Management’s estimation for Western European disposal realisation costs and losses of €4.2millon on 30 June 2022 has not remain closely connected for the foreseeable future with independent executives, MAS’ Board re-assessed its size, composition, as well as
approximately 230 real estate professionals, is well positioned to leverage the region’s continual high consumption growth and generate significantly changed compared to 31 December 2021, as it is expected that the positive result on sale of Langley Park will be offset by net the appropriate skills and experience required to guide and oversee MAS’ business in its next phase.
strong like-for-like (LFL) net rental income (NRI) growth from retail holdings by increasing tenants’ sales and implementing asset losses incurred on sale of other assets in WE. The estimate had been re-assessed from €27.1million on 30 June 2021, to €3.9million on 31 The Group is pleased to announce the appointment of Nadine Bird as Chief Financial Officer (CFO) with effect from 1 February 2023,
management initiatives. MAS benefits from downside-protected exposure to retail and residential developments via the development joint December 2021, following the successful results of sales completed in the first six months of the financial year, as well as progress with asset taking over Raluca Buzuleac’s financial responsibilities. Nadine is a highly experienced finance professional, with approximately 17 years
venture (DJV) 1 with developer Prime Kapital. management initiatives implemented at Flensburg Galerie (aimed at protecting shareholder value and preparing the asset for disposal), and of relevant experience, including a strong background in financial reporting, stock exchange listings and crisis management for complex,
On 30 June 2022, MAS’ shareholders approved two transactions between MAS and the DJV, namely (i) to acquire 100% of the share capital expecting that remaining assets will be disposed of at book value. Management’s current estimation accounts for the expected result on multi-jurisdictional public companies. She previously worked in audit, at Deloitte in South Africa, before acting as CFO for Steinhoff Africa,
and shareholder loans for six subsidiaries of PKM Development Limited (the DJV), owning six Romanian commercial centres (the Acquisition), sales, punitive fixed-interest arrangements on secured debt, early bank debt repayment penalties, agency fees and other related costs to be and being promoted to Deputy CFO for Steinhoff International after eruption of the group’s crisis in 2017. At Steinhoff International, among
and (ii) to extend the duration of the relationship with Prime Kapital via the DJV and to increase MAS’ funding commitment to the DJV (the incurred in completing the sales processes for the remaining assets held for sale. many other responsibilities, she assisted external forensic teams with investigations and ensured accurate financial information restatement
Extension, and collectively, the Transactions). The Transactions are effective on 30 June 2022, and, as such, relevant outcomes are included and subsequent re-publication, while also maintaining her responsibilities for Steinhoff Africa. Nadine will be based in MAS’ Bucharest office.
in MAS’ year-end financial results. RESIDENTIAL SALES MAS is pleased to announce the appointment of Roxana Bordeanu as Company Secretary, replacing Nathalie Vella, with effect from
By 30 June 2022, the DJV handed over to clients 308 units at Marmura Residence, resulting in €3million net profits on residential sales 25 August 2022. Roxana, who will also be part of MAS’ Capital Management team, is based in Malta. She has extensive experience with
FINANCIAL RESULTS included in MAS’ adjusted distributable earnings for the six months. This represents 93% of units sold in the project’s first four buildings. financing and capital markets, mergers and acquisitions, litigation and arbitration management, corporate governance, compliance and
Group adjusted total earnings are, on a segmented basis, the combined return of: (i) directly-owned income property and operations in CEE; policy development in respect of public companies. The Board thanks the outgoing Company Secretary for her dedicated service to the
(ii) Central and Eastern European investments with Prime Kapital in the DJV (including earnings from a proportion of completed DJV-owned LISTED SECURITIES AND MAS SHARE REPURCHASES Company during her tenure.
income properties, net results on residential sales and development activities); (iii) remaining directly-owned income property operations in On 30 June 2022, MAS held listed securities, shares in NEPI Rockcastle S.A. (NRP), to the value of €97.7million. MAS holds 19,078,242 shares
Western Europe (WE), and (iv) investments in listed securities (including other elements disclosed as Corporate). Melt Hamman, originally appointed on the request of Attacq Ltd, steps down from the Board effective 25 August 2022. The Board thanks
in NRP, of which 13,207,375 were acquired during the six months to 31 December 2021. Total adjusted returns during the six months to 30 Melt for his loyal service to the Group.
Adjusted total earnings for the six months to 30 June 2022 were €76.7million and consist of adjusted distributable earnings of €26.1million June 2022 on this investment, of which €4.3million represent accrued dividend returns for the period and €15.2million unrealised fair value
and adjusted non-distributable earnings of €50.6million. Tangible net asset value (NAV) is €1.40 per share on 30 June 2022, an increase of Malcolm Levy, MAS’ co-founder, steps down as Non-Executive Director effective 25 August 2022. Malcolm served as CFO for over 9 years
losses, have been negatively impacted by macroeconomic uncertainty affecting European listed real estate companies’ share prices. MAS following the Group’s foundation, becoming a Non-Executive Director June 2019, and providing valuable guidance to management
6.9% from 31 December 2021 and 12.9% compared to the end of the previous financial year (30 June 2021). Adjusted distributable earnings continues to expect its investment, at the average price of €5.58 per share, to generate total annual returns ranging between 10% and 12%
for the financial year is 6.83eurocents per share and resulted from 3.87eurocents per share for the six months to 30 June 2022, (4.6% above throughout MAS re-positioning from a Western European business, which is substantially complete. The Board is grateful and thanks Malcolm
by 2026. for his long-tenured service to the Group.
the guidance provided March 2022), and 2.96eurocents per share for the preceding six months.
In May and June 2022, MAS repurchased 16,586,906 of its issued shares via one of its subsidiaries, at a weighted average share price of €1.21 Following and considering directorship changes mentioned, the Board has restructured its committees as follows:
Variance in MAS’ adjusted total earnings compared to the preceding six months (to 31 December 2021), is mostly due to positive outcomes
generated by: per share, pursuant to the Company’s general authority to repurchase shares. Audit and Risk Committee Chair: Vasile Iuga; Members: Brett Nagle, Martin Slabbert
(i) persistent exceptional performance of, and increase in, NRI from retail properties in CEE, high rental and service charge collections and DEVELOPMENTS, EXTENSIONS AND REFURBISHMENTS IN THE DJV Remuneration and Nomination Committee Chair: Dan Pascariu; Members: Martin Slabbert, Werner Alberts
excellent trading achieved at commercial developments completed by the DJV during the first six months of the financial year (Barlad New development projects, with an estimated total cost of €280.6million, have been secured in Romania, increasing the DJV’s secured Environmental, Social and Ethics Committee Chair: Pierre Goosen; Members: Claudia Pendred, Irina Grigore
Value Centre and Prahova Value Centre); estimated commercial and residential development pipelines to €776million and €1,194.3million, respectively, at cost (figures not All changes to committee membership are effective 25 August 2022. The Board remains compliant with the King IV Code on Corporate
(ii) improvements in Central and Eastern European asset valuations due to previous point and valuation discount rates reverting to pre- proportionally consolidated). Progress with developments and additions to secured pipeline are detailed below. Governance following these changes to its composition and committee memberships.
Covid-19 levels;
(iii) completed first deliveries of finalised residential units at Marmura Residence, and Commercial developments LISTING ON A2X
(iv) increases in dividends from MAS’ listed securities following additional investments in the current period and previous six months, Construction of Alba Iulia Mall continues. As a consequence of delays caused by third parties in relocation of high voltage electricity lines MAS aims to identify opportunities providing its shareholders with optimal returns. Therefore, in addition to being traded on the Johannesburg
offsetting the negative impact of Western European asset sales on NRI. Stock Exchange, its ordinary shares will be traded on the A2X market, a licensed stock exchange authorised to provide a secondary listing
passing over the property, the project’s planned opening, previously scheduled in December 2022, is estimated for September 2023. Leasing
These positives have been partially offset by unfavourable variances in earnings, mainly due to (i) significant earnings in the previous period, venue for companies and regulated by the Financial Sector Conduct Authority in South Africa in terms of the Financial Markets Act 19 of 2012.
is progressing well, with over 80% of the project’s total 28,900m2 GLA currently leased to national and international tenants. An announcement with further details will follow in due course.
and resulting from a reduction in management’s estimate for disposal realisation costs and losses for Western European assets remaining
to be sold, not being repeated, and (ii) (unrealised) decrease in value of the Group’s listed securities, which was caused by macroeconomic Construction of Mall Moldova, extending and redeveloping Era Shopping Centre (29,600m2 GLA) into a super-regional enclosed mall and
uncertainty affecting European markets and listed real estate share prices. retail node incorporating approximately 101,300m2 of destination GLA, is scheduled to begin in November 2022. Leasing is ongoing with LONG-TERM STRATEGY UPDATE
outstanding interest from national and international tenants. MAS is committed to maximising total long-term returns from property investments on a per share basis. The Group aims to achieve
OPERATIONS this by concentrating on capital allocation, operational excellence, sensible leveraging, and cost efficiency, thereby sustainably growing
Construction and leasing for the first phase of the Silk District office and permitting for the following two phases are progressing well. distributable earnings per share. Benefiting from the continual high growth in Central and Eastern European consumption, the Group
Information regarding MAS’ Central and Eastern European gross leasable area (GLA) affected by restrictions, LFL footfall (compared to
2019), LFL tenants’ sales (compared to 2019), income entitlements (including invoicing, waivers and deferrals), collection rates (collections Construction and leasing are on track at Baia Mare Value Centre and Roman Value Centre extensions, which are scheduled to become operates directly-owned income property and employs capital in commercial and residential developments owned indirectly via the DJV
compared to invoicing) and pro forma collection rates (compared to the total expected income disregarding Covid-19’s impact) for the six operational in October and December 2022, respectively. Permitting and leasing for the extension to Slobozia Value Centre is ongoing. with co-investor and developer Prime Kapital.
months to 30 June 2022, is detailed in Table 1. Information regarding tenants’ sales in new properties that became operational after the first Permitting of Arges Mall and related bridge access infrastructure is complete and, after finalising relocation and demolition works, In the absence of unforeseen circumstances, MAS intends to maintain a full pay-out of distributable earnings and provided that the
six months of 2019 is detailed with reference to weighted average tenants’ sales in similar types of properties, in Table 2. All figures were construction is scheduled to start February 2023. Leasing continues with national and international tenants showing significant interest. Company’s long-term objectives, including self-imposed gearing limitations, are not considered at any point during this period to be at
reported on 18 August 2022. undue risk. However, if this is the case, or if attractive investment opportunities expected to substantially enhance total returns per share
Zoning is progressing for the DJV’s commercial projects in Bucharest (28,000m2 GLA open-air mall component on a 54ha of a former
Table 1 industrial platform, where a mixed-use urban regeneration project is planned), Brasov (19,800m2 GLA open-air mall) and Cluj (73,300m2 which cannot be otherwise more efficiently funded (for instance by selling assets, taking on additional gearing or issuing new share capital)
become available, then dividends relative to distributable earnings will be reduced.
Jan 22 Feb 22 Mar 22 Apr 22 May 22 Jun 22 Total GLA enclosed mall and 49,200m2 GLA office components on a 17ha land plot where the DJV plans a large-scale mixed-use project urban
regeneration project). With the release of the Group’s 30 June 2021 financial statements, MAS published four quantified strategic objectives set to be achieved over
Open GLA 2 % 9 24 85 100 100 100 70 five years (by the end of the 2026 financial year), using its existing capital base (at the time) and maintaining a full payout of distributable
Restricted GLA 3
% 91 76 15 - - - 30 Residential developments earnings to shareholders without breaching self-imposed gearing limitations, and is committed to periodic reporting on these. Achieving
Closed GLA 4
% - - - - - - - At Marmura Residence, the DJV’s first completed residential project, handover was performed for 308 units (67%) in the first four buildings these targets is expected to lead to substantial improvements in total returns per share, and implies an increase in scale, positioning the
Footfall (2022 compared to 2019) % 78 82 95 104 105 97 94 Company well for an investment-grade credit rating, which will enable further flexible access to debt finance at optimal cost. Current progress
of the project’s total five buildings comprising 458 units, by 30 June 2022. Construction on the fifth building is substantially complete and is detailed below.
Open-air malls % 89 91 97 110 109 102 100 handover will commence soon.
Enclosed malls % 68 72 92 98 100 91 87 Construction and sales continue for approximately half of the development comprising 746 dwellings on the Avalon Estate residential project. Asset management
Tenants’ sales per m (2022 compared to 2019)
2
% 103 107 111 125 129 113 115 To date, 70% of the 352 residential units currently released for sale have been sold. Construction and finishing works on the first buildings MAS aims to maximise property values through sustainable asset management initiatives. The Group plans to achieve this through specific
Open-air malls % 109 113 113 126 125 115 117 are complete, the sales office has been operational in the project’s gatehouse since March 2022 and fit-out commenced on four show units. asset management initiatives to improve occupancy rates for current Central and Eastern European retail assets to 99% by 30 June 2026 and
Construction of the first phase of Silk District’s residential component (315 units; 71% sold) is progressing well. Permitting for the second achieving LFL NRI growth of at least 4% per annum (from a normalised post Covid-19 base).
Enclosed malls % 93 97 108 123 133 110 112
phase (346 units; 48% sold) has been obtained and it is ongoing in respect of the third phase (312 units; 25% reserved). Progress continues to be excellent. On 30 June 2022, occupancy for Central and Eastern European assets increased to 96.3% (95.3% on
Total pre-pandemic income expectation €m 4.5 4.5 4.6 4.6 4.6 4.6 27.4 31 December 2021) and annualised LFL passing NRI in CEE is 4.7% higher than six months earlier on 31 December 2021 (13.6% higher than
Income waived, deferred, or suspended €m 0.1 0.1 - - - - 0.2 Permitting for the first phase of Pleiades Residence (142 units in two of the seven buildings planned in the residential component of the on 30 June 2021).
Due income (invoiced) €m 4.4 4.4 4.6 4.6 4.6 4.6 27.2 10.1ha mixed use urban regeneration in downtown Ploiesti) has completed and construction works have commenced. Rezoning of the
remaining land for the following stages of development is ongoing in parallel with permitting for the planned extension on Prahova Value Commercial developments
Collection rate % 100 100 99 99 100 99 99
Centre, the 21,700m2 GLA open-air mall component of the project. Sales (launched in December 2021) are progressing well with 22.5% of the The Group expects to enlarge its investment in newly developed, high quality, income properties rolled-out by joint venture partner Prime
Pro forma collection rate % 98 98 99 99 100 99 99 apartments in the first phase contracted to date. Kapital, and the DJV aims to complete commercial developments to the cost of approximately €600million at a weighted initial yield of more
Table 2 Zoning is progressing for Roman Residential (2,137 apartments in Brasov) and Elba Residential (1,251 apartments in Timisoara) as well as than 9% over the relevant five years (figure not proportionally consolidated).
Jan 22 Feb 22 Mar 22 Apr 22 May 22 Jun 22 Total for the residential components of the large-scale mixed-use projects mentioned above in Bucharest (3,149 apartments) and Cluj (1,461 The DJV is well positioned to achieve these targets. Secured commercial projects to the value of €517.1million are currently estimated to
apartments). be completed by 30 June 2026 at a weighted average initial yield of 9.3%. During the first six months of the 2022 financial year, the DJV
Tenants’ sales per m2 (2022 compared to weighted % 122 124 127 141 130 116 127 completed projects worth €50.8million at cost, in Barlad and Ploiesti, with initial yields of 9.8% and 9.9%, respectively.
average sales for similar properties in 2019) New pipeline
Open-air malls % 117 118 123 135 132 120 125 Residential developments
A 6.9ha site was secured in south-eastern Timisoara, Romania, in an area being converted from industrial to retail and residential, for the
Enclosed malls % 133 137 138 162 130 113 135 DJV’s second large-scale residential development in the city. It will consist of approximately 2,300 apartments and support functions. MAS aims to benefit from a sustainable and growing distributable income stream, through residential sales and deliveries by the DJV
Romania’s third largest city, Timisoara’s fundamentals are strong and suitable for multiple quality residential developments. Timisoara’s of approximately €200million per annum by the 2026 financial year (figure not proportionally consolidated) at net after tax margins of
For the first six months of the 2022 calendar year, trading in the Group’s Central and Eastern European countries was exceptional. After all approximately 20%.
current residential stock is low in terms of average living area per capita. Existing stock and planned or ongoing residential developments are
restrictions were removed by Romanian and Bulgarian authorities in March 2022, footfall and tenant sales improved significantly. generally of poor quality. The project is well positioned, between two main boulevards, with excellent public transport connectivity to the city A significant residential pipeline of approximately €1.2billion has been secured for the DJV, which is expected to achieve in excess of the DJV’s
Footfall in CEE was satisfactory for the second half of the financial year, especially once restrictions were lifted, with open-air malls centre, and within a 15-minute drive of the city’s office hubs, historical centre and main shopping destinations. target of €200million in annual sales by 2026.
consistently performing better than the same period in 2019. The trend observed in previous periods continued, as open-air malls achieved
pre-pandemic levels (the same period in 2019), as compared to enclosed malls (13% decrease). The DJV has secured land and is currently undergoing due diligence for a large-scale enclosed residential estate of approximately 920 Direct acquisitions
apartments, in a major secondary city in Romania. Further details will be provided in due course. MAS aimed to complete direct acquisitions of high-quality, Central and Eastern European commercial assets to the value of at least
Tenants’ sales on a LFL basis have continued to comfortably exceed pre-pandemic levels up to March, prior to pandemic restrictions being
lifted. In April and May, once restrictions were lifted, LFL sales in both open-air and enclosed malls substantially accelerated, with strong In addition to the above, the DJV has secured an approximately 5.9ha site in Giurgiu, Romania, on the European Route E85 to Bucharest, €150million during the 2022 financial year and a further €50million by the end of the 2023 financial year. To this end, by completing the
performance continuing in June. Overall, tenants’ sales outperformed prepandemic levels by 17% in open-air malls and 12% in enclosed malls. a major freight and leisure road transport artery, connecting Romania to Bulgaria, Greece and Turkey. Based on annual river traffic on the Acquisition, as well as via its investment in NRP during the current and previous six months, MAS has exceeded the targets previously set for
Most categories performed admirably, reflecting overall growth trend, with some tenants achieving all-time record sales at stores within Danube River, Giurgiu is one of Romania’s largest harbour cities. The site has an excellent location adjacent to Giurgiu’s border with Bulgaria acquisitions of direct property. MAS continues to be focused on considering appropriate direct acquisition opportunities in the CEE.
assets the Group operates. Food service, health and beauty, complements, DIY, pet shops and toys have had a notable outperformance. and good visibility from the city centre. It is earmarked for an approximately 14,200m2 GLA open-air shopping centre, with potential for The Company is well positioned to execute on the ambitious but achievable strategic targets adopted, which are expected to generate best-
Leisure and specialist tenants’ sales have still not returned to pre-pandemic levels, despite improving sales after March. an additional 4,300m2 GLA extension. The project’s catchment area includes approximately 110,000 residents within a 30-minute drive. in-class long-term total shareholder returns. It is expected that real GDP and consumption growth in Romania will endure during this period,
Tenants’ sales in the Group’s newer assets, that became operational after the first half of 2019 calendar year, have performed exceptionally and that long-term growth in Romania and other CEE countries will continue to remain robust and significantly surpass growth in Western
during the six months, and have outperformed pre-pandemic levels in both open-air malls (25% increase) and enclosed malls (35% increase) EXTENSIONS AND REFURBISHMENTS TO DIRECTLY-OWNED ASSETS European countries for the foreseeable future. The transactions approved by MAS’ shareholders will continue to add scale to the Group’s
compared to tenants’ sales in similar assets that were operational in the same period of 2019. The extension to Galleria Burgas was reconsidered and the centre will undergo a major refurbishment instead, including a reconfiguration of CEE operations via increasing MAS’ investment commitments to the DJV. Management expects the higher inflationary impact on rentals and
the food court, to improve the leisure and entertainment facilities and triple the existing food court’s seating capacity. This will rejuvenate the service charges through to 2023 to be easily absorbed by tenants.
Pro forma collection rates were excellent throughout the six-month period, achieving pre-pandemic levels of 99% despite restrictions in the
first two months of the 2022 calendar year. centre and enhance its attractivity to the 479,000 residents within a 60-minute drive, as well as position it as one of the main entertainment Long-term earnings targets
Occupancy cost ratios (excluding certain tenant categories: supermarkets, DIY stores, entertainment and services) up to 30 June 2022 attractions for Burgas’ 3million annual tourists.
MAS expects delivery on its strategic objectives to result in significant per share distributable earnings (and dividend) growth. Targeted
remained healthy, at 11.1% and improved over the figure on 31 December 2021 (11.3%), despite higher absolute occupancy costs due to Further updates regarding the leisure and entertainment extensions at Prahova Value Centre (5,700 m2) and Barlad Value Centre (1,300 m2 distributable earnings ranging between 14.5eurocents and 15eurocents per share for the 2026 financial year should comfortably be
increased rentals and service charges. GLA), both centres recently acquired by MAS (with the Acquisition), as well as re-assessed, previously planned, extension projects at Nova achieved. To achieve these results, it is assumed that, amongst others,
Leasing and ongoing asset management initiatives are progressing well, aimed at achieving MAS’ strategic asset management targets by the Park and Militari Shopping will be provided in due course. (i) the remaining Western European assets are sold as per management’s estimates;
end of the 2026 financial year. Consequently, occupancy of Central and Eastern European assets increased to 96.3% on 30 June 2022 (95.3% (ii) stated asset management targets are achieved;
on 31 December 2021). Passing NRI increased by 4.7% during the second half of the financial year and by 13.6% on a year-on-year basis. This DEBT, COST OF DEBT AND LIQUIDITY
(iii) secured commercial and residential development pipeline is permitted and rolled out as planned;
is partly attributable to higher rent indexation due to Euro inflation, as well as rental from overage. MAS’ properties benefit from Euro-based, On 30 June 2022, MAS had €202million in cash, listed securities and undrawn credit facilities (figure not proportionally consolidated), net of (iv) NRP performs as expected and that its shares trade at the projected Tangible NAV per share;
triple-net, leases, with full Euro indexation to base (minimum) rents and turnover clauses. As a result, MAS can fully pass indexation to its €89.8million cash payment obligation to be settled after the financial year end in respect of the Acquisition. Further to the Acquisition’s (v) no further MAS shares are issued, during this period, and
tenants, which are expected to comfortably absorb higher rents, as occupancy cost ratios are expected to remain healthy due to continued completion, on 30 June 2022, the Group has an ongoing undrawn preferred equity investment commitment of €233.9million to the DJV, as (vi) no major economic disruptions occur before 30 June 2026.
robust tenants’ sales. well as a €30million undrawn committed revolving facility to the DJV (figures not proportionally consolidated).
In WE, operations, including collections were consistent with the six months to 31 December 2021. Interest rates on MAS’ debt are hedged, except for its undrawn revolving credit facility. MAS’ secured debt (in respect of Flensburg Galerie) EARNINGS GUIDANCE AND PROSPECTS
carries a fixed interest rate, and the bond carries a 4.25% fixed coupon, therefore neither would be impacted by rising variable rates. Secured Distributable earnings per share for the 2023 financial year have been revised upward in light of the completed Acquisition on 30 June 2022,
PROPERTY VALUATIONS debt on properties acquired from the DJV effective 30 June 2022, carries an attractive weighted average annual interest of 3-month EURIBOR and it is now expected to range from 9.40eurocents to 10.10eurocents per share (of which 0.65 to 1.10eurocents per share is expected to
Valuation of MAS’ (and the DJV’s) properties is determined biannually by external, independent professional valuers, with appropriate, be from residential sales). This guidance is based on the assumptions that no additional material macroeconomic disruption occurs, a stable
recognised qualifications and recent experience in the relevant location and category of property. Valuations are primarily based on plus a margin of approximately 3.3% and is fully hedged via interest rate caps until end of 2028 financial year. political environment prevails in the Groups’ markets, developments continue as scheduled, and no major corporate failures ensue.
discounted forecast cash flows and are therefore forward-looking. On 30 June 2022, the Group’s bond and unsecured facility ratios demonstrated significant headroom compared to covenant tolerances, on Shareholders should note that the Company’s estimates and distributable earnings per share targets have not been audited and are subject
The income property fair value uplift of €63.8million was due to positive fair value adjustments to income property in CEE of €66.8million (an both IFRS and proportionate consolidation bases. to change. Inevitably, some assumptions will not materialise, plans will change, and unanticipated events and circumstances may affect
improvement of 11.5% compared to the independent valuations on 31 December 2021 and 19.3% compared to June 2021) and a decrease of the ultimate financial results. The Company will not hesitate to adopt changes in strategy, or to take action that will impact negatively on
€3.0million in WE (a decrease of 3.4% compared to valuations on 31 December 2021, which was mainly driven by an increase in the valuation Tolerance Actual IFRS Actual proportionate consolidated basis distributable income per share, if this is considered appropriate from a long-term, risk-adjusted, total return perspective.
discount rate used for Flensburg Galerie, as well as the negative impact of foreign exchange rates regarding UK assets held for sale). Solvency ratio Shall not exceed 0.6 0.30 0.29 This forecast has not been audited or reviewed by MAS’ auditors and is the responsibility of the Board of Directors.
Valuation uplift of assets in CEE was primarily the result of (i) LFL passing NRI increases of 4.7% since December 2021 due to strong Consolidated coverage ratio At least 2.5:1 3.46 3.70
operational metrics following the lifting of all Covid-19 restrictions March 2022, and (ii) valuation discount rates reverting to pre-pandemic Unencumbered consolidated total assets/ DIVIDEND DECLARATION
levels. Valuation discount rates had been subject to a risk premium of approximately 75 basis points at the pandemic’s onset, which was Minimum 180% 379% 407% The Company achieved 3.87eurocents adjusted distributable earnings per share, and 3.82eurocents diluted adjusted distributable
unsecured consolidated total debt
partly eliminated by external valuers in the second half of the 2021 calendar year. For most properties, the remaining pandemic-related earnings per share (taking account of share purchase plan issued shares) in respect of the six-month period to 30 June 2022. The Board has
risk premium was eliminated once all restrictions had been lifted, based on evidence that footfall was returning to pre-pandemic levels and The self-imposed, long-term Group overall debt limit, which is considerably more restrictive than its covenant tolerances, is a maximum loan- consequently declared a cash dividend of 3.82eurocents per share for the six months ending then. Payment is expected by 26 September
tenants’ turnovers were reverting to pre-pandemic growth trends. The weighted average unlevered discount rate for income property in to-value (LTV) ratio of 40%, or, on a forward-looking basis, seven times net rental income. On 30 June 2022, the Group had €463.5million of 2022 and further details will be announced separately.
CEE decreased from 10.01% to 9.71% compared to valuations for the six months to 31 December 2021 (and from 10.17% on 30 June 2021). outstanding debt (bonds and bank loans) and the LTV ratio was 21.5%. The effective LTV ratio, taking account of the cash settlement with Irina Grigore 25 August 2022, Malta
Indicators regarding property valuations for the six assets acquired by MAS from the DJV are presented on a comparable basis. respect to the Acquisition, is 28.4%. The weighted average cost of debt was 4.41% per annum for the financial year ended 30 June 2022. Chief Executive Officer Released on 29 August 2022
1
DJV is an abbreviation for a separate corporate entity named PKM Development Limited (PKM Development), an associate of MAS since 2016 with €30million (figures not proportionally consolidated). The balance of the ordinary share capital in PKM Development was taken up by Prime Kapital in 2
GLA open for trade without restrictions.
independent governance. MAS owns 40% of the ordinary share capital of PKM Development, an investment conditional on it irrevocably undertaking 2016 for €30million in cash, and, in terms of applicable contractual undertakings and restrictions, Prime Kapital: (i) is not permitted to undertake real 3
GLA open for trade subject to restrictions (pro-rated to reflect days with restrictions).
to provide preferred equity to PKM Development on notice of drawdown. MAS’ undertakings to PKM Development arose prior to Prime Kapital’s estate development in CEE outside of PKM Development until the DJV’s capital commitments are fully drawn and invested or 2030 (end of exclusivity 4
GLA closed for trade (pro-rated to reflect days closed).
founders joining MAS’ Board in November 2019 and have been modified, with MAS’ shareholders’ approval, via the Extension. On 30 June 2022, period); (ii) contributes secured development pipeline to PKM Development at cost; (iii) takes responsibility for sourcing further developments, and
MAS invested €236.1million in preferred equity and had an obligation of €233.9million outstanding, as well as an undrawn revolving credit facility of (iv) provides PKM Development with all necessary construction and development services via integrated in-house platform.
All amounts in € thousand unless otherwise stated. Audited Audited SEGMENTAL ANALYSIS Proportionate accounts Adjustments Adjusted proportionate accounts
CONDENSED CONSOLIDATED STATEMENT 30 Jun 22 30 Jun 21 INCOME STATEMENT (JAN – JUN 2022) Six months to 30 Jun 2022 Six months to 30 Jun 2022 Six months to 30 Jun 2022
OF FINANCIAL POSITION Total CEE DJV WE Co*** Total CEE DJV WE Co Total CEE DJV WE Co
Non-current assets 1,141,198 758,253 EARNINGS 74,260 58,627 37,216 97 (21,680) 2,433 7,757 (5,927) (261) 864 76,693 66,384 31,289 (164) (20,816)
Current assets 388,402 568,327 Distributable earnings 25,718 15,890 15,150 162 (5,484) 366 – (841) – 1,207 26,084 15,890 14,309 162 (4,277)
Total assets 1,529,600 1,326,580 Net rental income – income property 22,678 17,073 4,312 1,293 – – – – – – 22,678 17,073 4,312 1,293 –
Equity attributable to owners of the Group 928,150 869,423 Net margin – residential sales 2,959 – 2,959 – – – – – – – 2,959 – 2,959 – –
Total equity 928,150 869,423 Net income – preferred equity 6,555 – 6,555 – – – – – – – 6,555 – 6,555 – –
Non-current liabilities 450,826 321,059 Net dividends – listed securities 4,177 – 841 – 3,336 162 – (841) – 1,003 4,339 – – – 4,339
Current liabilities 150,624 136,098 Net corporate expenses (2,715) (595) (423) (270) (1,427) – – – – – (2,715) (595) (423) (270) (1,427)
Total liabilities 601,450 457,157 Interest on debt financing (8,437) – (511) (797) (7,129) – – – – – (8,437) – (511) (797) (7,129)
Total shareholder equity & liabilities 1,529,600 1,326,580 Interest capitalised on developments 1,457 ...
