11 May 2011 11:52
Price Sensitive economic-financial results

The Board of Directors approves the Interim Management Statement at 31 March 2011

The consolidated results in the first quarter of 2011 show further growth (vs. first quarter 2010):

  • Total operating revenue: €31.4 million (+ 11.9% with respect to 31 March 2010)
  • Revenue from core business1: €29.7 million (an increase of 5.7% with respect to the €28.1 million recorded at 31 March 2010)
  • EBITDA from core business: €21.8 million (an increase of 8.3% with respect to the €20.1 million recorded at 31 March 2010)
  • EBITDA MARGIN from core business: 73.5% (up 1.7 pp vs. the 71.8% recorded at 31 March 2010)
  • Funds from operations (FFO): €11.8 million (+ 18.9% with respect to 31 March 2010)
  • The Group’s portion of net profit in the period amounts to €10.4 million (an increase of 22.7% with respect to the €8.5 million recorded at 31 March 2010)
  • Net debt: €1.003 billion (an improvement with respect to the €1.017 billion posted at 31 December 2010)

Today the Board of Directors of IGD – Immobiliare Grande Distribuzione SIIQ S.p.A. (“IGD” or the “Company”), leading owner and manager of retail shopping centers in Italy and listed on the STAR segment of the Italian Stock Exchange, in a meeting chaired by Gilberto Coffari, examined and approved the Interim Management Statement at 31 March 2011 which shows the Group’s portion of net profit for the period at €10.4 million (+22.7% vs. 31 March 2010).

Preface

For the first time, in the Interim Management Statement at 31 March 2011, IGD has separated its core business from those relative to the “Porta a Mare” Project in Livorno which, following the sale of a portion of the office buildings, generated its first revenue.

Principal consolidated results for first quarter 2011

The IGD Group’s revenue from core business at 31 March 2011 amounted to €29.7 million, an increase of 5.7% with respect to the €28.1 million posted in first quarter 2010. More in detail, rental income in first quarter 2011 increased by 5.6%, while revenue from services rose by 8.7% vs. 31 March 2010. In first quarter 2011 for the first time the IGD Group also recorded revenue from the sale of properties pertaining to the multifunctional project in Livorno totalling €1.7 million and, therefore, total operating revenue at 31 March 2011 amounted to €31.4 million, an increase of 11.9% with respect to the first quarter of the prior year.

The IGD Group’s EBITDA from core business at 31 March 2011 amounted to €21.8 million, an increase of 8.3% with respect to the €20.1 million recorded in first quarter 2010. The margin from freehold properties increased 7.1%, from leasehold properties 9.9%, while the margin from services rose by 10.9% with respect to 31 March 2010. Total EBITDA in first quarter 2011, due to the impact of the above mentioned sale of the office units in Livorno, increased 10.2% to €22.2 million.

Direct costs for core business, including direct personnel expense, amounted to €5.8 million, in line with the same period in the prior year. These costs represent 19.4% of operating revenue. General expenses for continuing operations, including payroll costs at headquarters, amounted to €2.1 million at 31 March 2011, a drop of 2.5%. These costs represent 7.1% of operating revenue.

EBITDA margin for core business reached 73.5%, an increase of 1.7 pp with respect to the 71.8% reported in first quarter 2010. The growth confirms the solid operating trend and the stability of the cost structure.

EBIT at 31 March 2011 amounted to €21.6 million, an increase of 9.7% compared to the €19.6 million reported at 31 March 2010, due primarily to the increase in EBITDA.

The IGD Group’s pre-tax profit at 31 March 2011 rose by 15.1% with respect to the prior year from the €9.8 million reported at 31 March 2010 to €11.2 million.

The IGD Group’s tax burden, current and deferred, at 31 March 2011 amounted to €829 thousand, reflecting a tax rate of 7.4%, an improvement with respect to the 13.4% recorded in the same period of the prior year which is primarily attributable to the effect of the merger by incorporation of Faenza Sviluppo in IGD SIIQ S.p.A. on 28/06/2010.

The Group’s portion of net profit for the period amounted to €10.4 million at 31 March 2011, an increase of 22.7% with respect to the €8.5 million recorded in first quarter 2010.

The Funds from Operations (FFO) , a significant indicator used in the real estate market to define the cash flow from a company’s operations based on net profit, net of current tax, writedowns, fair value, amortization and depreciation, rose from €9.9 million at 31 March 2010 to approximately €11.8 million at 31 December 2011, an increase of 18.9%.

The IGD Group’s net debt at 31 March 2011 came in at €1.003 billion, an improvement compared to the €1.017 billion recorded at 31 December 2010 thanks to a drop in charges relating to derivatives with respect to the prior period and a decrease in non-current financial liabilities due to repayments made during the quarter.

At the end of first quarter 2011 the gearing ratio (debt to equity ratio) came in at 1.27, compared to 1.31 at 31 December 2010. In first quarter 2011 IGD also confirmed its ability to maintain its low cost of debt which amounted to 3.91% at 31 March 2011.

“Based on the results for first quarter 2011, we are confident that we will be able to achieve the financial economic targets that we presented to the market, along with our updated 2009-2013 Business Plan, in November 2010” Claudio Albertini, IGD – Immobiliare Grande Distribuzione SIIQ S.p.A.’s Chief Executive Officer stated, ”In 2011 the IGD Group expects to see growth in all the key performance indicators such as revenue, EBITDA, EBITDA margin thanks to the new openings which will become fully operational during the year and the average yield of the real estate portfolio, in addition to a gearing level which will be maintained below 1.5x”.