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ATENOR
Interim / Quarterly Report • Sep 2, 2022
3908_ir_2022-09-02_881566f8-3b06-4470-a206-e3da9fb1e195.pdf
Interim / Quarterly Report
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HALF-YEAR FINANCIAL REPORT 20221
La Hulpe, 2 September 2022
HALF-YEAR RESULT: €9.00 M, IN LINE WITH OUR EXPECTATIONS
ACTIVITIES REPORT: (VALUE CREATION CYCLE)
- BUILDING PERMIT APPLICATIONS AND OBTAINING OF PERMITS IN ACCORDANCE WITH EXPECTATIONS
- OFFICE RENTALS: ABOVE EXPECTATIONS;
- FLAT SALES: 125 FLATS, PREDICTABLE SLOWDOWNS.
ASSESSMENT: EXTENSION OF "GREEN" FUNDING: GREEN RETAIL BOND AND BANK FINANCING. 28% (PER 30.06.2022) VS 13% (PER 31.12.2021)
DEVELOPMENT PORTFOLIO: 32 PROJECTS TOTALLING SOME 1,300,000 M²
DIVIDEND POLICY: PLANNED CONTINUATION OF THE DIVIDEND POLICY
ATENOR'S CEO STÉPHAN SONNEVILLE SA COMMENTS:
"Recent major office leases confirm the attractiveness of the buildings developed by our teams. The strong political and macroeconomic tensions could not overshadow the global climate emergency and the necessary adaptation of the urban real estate stock. With its resolutely international and sustainable strategy, Atenor is ideally positioned. "
* * *
In order to facilitate the understanding of our activities and track their evolution, we provide relevant comments on the first half-year's activities in accordance with the main stages of the value creation cycle in our core business.
1 ATENOR has chosen French as its official language. Consequently, only the French version text is authentic. The version in English is translation of the French version.
A. General overview of activities
SF0
The figures for 2022 in the chart below are set on 30 June 2022. They are stated in gross above-ground surfaces (m²).
Acquisitions: We completed the acquisition of Astro in Brussels for the redevelopment of 10,200 m2 of office and housing space via renovation and construction.
Building permit applications: Building permit applications for several major projects have been submitted in accordance with the study schedules we had set ourselves. These include the Cloche d'Or project in Luxembourg City, Bakerstreet II in Budapest, and the new Realex in Brussels.
This large amount of floor area currently under development confirms the planned increase in activity.
Getting building permits: The increasing number of permit requests resulted in most of them being granted during the second half of 2022. This being said the building permits for the Wellbe and Bakerstreet II office projects in Lisbon and Budapest respectively had already been obtained during Q2 2022.
Construction startup: The figures for the first half of the year relating to construction starts concern residential projects: Lake 11 in Budapest and City Dox in Brussels. In the second half of the year, we will start construction of nearly 150,000 m2 of floor space, two-thirds of which will be offices. These construction starts are spread across 6 countries and will mostly be financed by banks.
In general, all projects currently under construction are progressing according to schedule and are not significantly affected by the geopolitical events and their inflationary consequences.
Leases: After signing a final agreement with PwC for the lease of the entire Cloche d'Or project (~33,500 m2 ) in Luxembourg City, we signed a 16,200 m2 occupation agreement with the E.ON group for the Bakerstreet I property in Budapest.
The intrinsic qualities of the buildings designed were a determining factor in the choice made by the tenants: environmental and architectural qualities, internal functionalities to attract talent and allow the effective implementation of New Ways of Working (NWOW). These major locations in their respective markets are the concrete expression of ATENOR's positioning: internationalisation and sustainability.
Sales: In the residential sector, sales of flats met our objectives where marketing is active (Belgium, Hungary, Romania, and Luxembourg). However, we expect a slowdown in the second half of the year due to macroeconomic conditions, especially in Hungary and Romania. However, this slowdown will have no impact on 2022 results as the margin is only taken at delivery.
Investment in the office sector has slowed down in recent months, due to a wait-and-see attitude by investors in the context of increasing interest rates. Contacts are underway for the sale of several projects, although it is
1
not possible at this stage to specify the timetable for the conclusion of the planned transactions. More information will be provided on the progress of these sales in the coming months.
In addition, we have decided to keep the Nysdam property (La Hulpe), which houses our head office, as an investment property.
B. Prospects for FY 2022:
The global political and economic situation calls for caution among economic actors. Several factors are impacting the real estate sector:
˃ Negative impacts
The increase in construction costs and mainly in the cost of certain materials.
The shortage of certain materials and skilled labor.
The increase of interest rates.
Yield increases.
˃ Positive impacts
The indexation of rents
The need to reduce energy bills and ensure energy independence.
The implementation of NWOW with a view, in particular, to promoting the talent retention and the post Covid return of employees to the office.
The imperatives of sustainable development (Green Deal, taxonomy) which are spreading in all sectors of the economy, including in the management of portfolios by investors.
Through its proactive management of ongoing projects and constructions, ATENOR has up to now been able to reduce the negative impacts to insignificant consequences.
Due to its core business as a developer and its sustainable and international positioning, ATENOR currently observes a neutral balance of the various influences of the macroeconomic trends and indicators mentioned above.
For example, the generalized increase in yields, although a reality, is to be qualified according to the quality of the building and the leases. The demand for high performance buildings from both large tenants and investors is illustrated by ATENOR's activity report and supports the outlook.
However, these macroeconomic and political circumstances suffered in the wake of the Covid health crisis are impacting ATENOR in terms of timing of results. The announced slowdown in the global economy adds a degree of uncertainty in this regard.
In this context, and despite the quality and maturity of ATENOR's portfolio of projects, the level of the company's performance in 2022 cannot yet be specified.
This outlook will be clarified in the coming weeks in line with the evolution of the transactions envisaged.
C. Interim Management Report
The first half of 2022 closed with a consolidated net profit (group share) of €9 million, down from the €29.60 million result posted for the first half of 2021.
At 30 June 2022, this result was mainly generated by margins on sold and pre-sold projects, both office and residential, the capital gain on the sale of 50% of the shareholding in Cloche d'Or Development (Luxembourg), and the revaluation of the Nysdam building following its reclassification as an investment property (IAS 40). The rental income from the Nysdam (La Hulpe, Belgium), University Business Center II (Warsaw, Poland), and Arena Business Campus A (Budapest, Hungary) properties also contributed to this.
Revenue in this half-year was once again diverse, with 7 projects contributing to the results.
Table of key consolidated figures (in thousands of Euros) - Limited review of the auditor
| Results | 30/06/2022 | 30/06/2021 |
|---|---|---|
| Net consolidated result (group share) | 8,996 | 29,604 |
| Profit per share (in Euros) | 1.34 | 4.40 |
| Number of shares | 7,038,845 | 7,038,845 |
| of which own shares | 313,427 | 313,427 |
| Balance sheet | 30/06/2022 | 31/12/2021 |
| Total assets | 1,194,934 | 1,229,814 |
| Cash position at end-of- period | 22,313 | 92,116 |
| Net indebtedness (-) | -802,816 | -742,427 |
| Total of consolidated equity | 284,834 | 301,043 |
Revenue from ordinary activities and consolidated results
Revenue from ordinary activities as at 30 June 2022 amounted to €12.12 million. It consists of (a) revenue from the sale of flats in residential projects (City Dox, Twist) for a total of €2.41 million, (b) revenue earned from the off-plan sales of the Au Fil des Grands Prés project (offices; €4.87 million), (c) additional revenue from the sale in 2021 of the Vaci Greens E property (€1.84 million), as well as (d) lease revenues on the University Business Center II (Warsaw), Nysdam (La Hulpe), Arena Business Campus A, and Cloche d'Or Development properties, totalling €1.68 million.
Other operating income (€18.77 million) includes the result of the sale of 50% of the shareholding in Cloche d'Or Development (€13.09 million) and the reinvoicing of the fit-out works in the sold Vaci Greens E and Buzz projects (€4.17 million).
The operating result amounts to €18.43 million. This is mainly influenced by the result of the sale of 50% of the stake in Cloche d'Or Development (€13.06 million), the apartments of the various residential projects (total of €0.54 million), from the results on the pre-sold office buildings Au Fil des Grands Prés and sold Vaci Greens and Buzz (€4.63 million), the revaluation of the Nysdam building following its reclassification as an investment property (€6.04 million) as well as the rental income, net of charges, from the Nysdam, Cloche d'Or, and Arena Business Campus A buildings (total of €0.83 million).
The net financial result amounts to -€7.78 million compared to -€5.34 million for the first half of 2021. The increase of net financial charges over the first-half year is mainly due to the increase in the Group's average net debt (+€61.36 million compared to the first half of 2021) coupled with the decrease in activations (IAS 23; - €0.55 million compared to the first half of 2021) relating to the developments in progress.
Taxes amount to €0.67 million as at 30 June 2022, and are mainly composed of current tax and deferred tax liabilities relating to the City Dox and Twist projects.
The net result (group share) for the first half of the financial year amounts to €9 million.
Consolidated balance sheet
Consolidated shareholders' equity amounts to €284.83 million, which represents 24% of the balance sheet total, down €16.21 million from 31 December 2021 mainly due to the payment of dividends and translation differences.
As at 30 June 2022, the Group's net consolidated indebtedness is €802.82 million (excluding available cash) compared to the net consolidated indebtedness of €742.43 million as at 31 December 2021. As a reminder, ATENOR issued a 6-year "Green" bond in the amount of €55 million in April 2022.
The "properties held for sale" classified under "Inventories (Stock)" represent the real property projects in the portfolio and under development. This item amounts to €872.08 million, down €60.91 million net from 31 December 2021. This variation results primarily from (a) the acquisition of the Fleet House (London) and Astro (Brussels) projects for a total of €36.78 million, (b) the continuation of the works and studies of the Arena Business Campus, Roseville, Bakerstreet, Lake 11 (Budapest), @Expo, UP-site (Bucharest), Lakeside (Warsaw), Am Wherharhn, Heinrichstrasse (Dusseldorf), Well'be (Lisbon), Twist (Luxembourg), City Dox (Brussels), Victor Hugo, and Com'Unity (Paris) projects, for a total of €59.37 million, (c) the sale of flats in the City Dox and Twist projects, and the sales of the Au Fil des Grands Prés office properties, reducing the stock by €6.10 million, (d) the exit of the Cloche d'Or project from stock following the equity accounting of the Cloche d'Or Development
shareholding (-€135.91 million) and (e) the transfer of the Nysdam building to "investment property" heading in the amount of €15.4 million (see Note 9). The conversion differences related to the projects in Central Europe had a downward impact on the stock of €9.43 million; finally, the balance of the net change in this item (€9.78 million) is distributed over other projects under development.
Financing policy
ATENOR pursues a financial policy that favours sustainable financing for projects under development on the one hand, and diversification of its sources of financing on the other. The latest 6-year bond issue meets the ambitious criteria of ATENOR's sustainable financing (Green Retail Bond of €55 million on 5 April 2022 issued in the context of the EMTN programme).
ATENOR relies on both the institutional investor and banking markets. For many years, the real estate and financial experience acquired in the various European capitals has enabled ATENOR to reach out to local and European banks for the sustainable financing of projects to be developed. The "greening" of bank debt is underway. In this respect, we have concluded the financing of the Victor Hugo project in France with Banque Populaire Rives de Paris. ATENOR intends to continue using its commercial paper (MTN), favouring long terms (from 18 months) at fixed or variable rates and gradually replacing terms of under 12 months.
Within the context of its Green Finance Framework (GFF), ATENOR will also continue using the EMTN line and its Green NEU CP & NEU MTN lines in both Belgium and France. ATENOR regularly deals with and will continue dealing with the proposals (reverse inquiries) of qualified investors for maturities corresponding to the European development of its project portfolio.
The weighted average interest rate of ATENOR's consolidated debt is 2.45% (vs 2,40% in 2021).
Principal risks and uncertainties
The strong international political and macroeconomic tensions and the announced economic slowdown will undoubtedly have an impact on the real estate sector. At this stage, we believe that the uncertainty is linked the timing of results, and does not undermine the portfolio's value and profitability potential. We are carefully monitoring the evolution of this macroeconomic situation and the possible implications for ATENOR.
In general, and permanent way, the Board of Directors is attentive to the analysis and management of the various risks and uncertainties with which ATENOR and its subsidiaries are confronted. As at 30 June 2022, ATENOR is not facing any significant litigation.
Impacts of the crisis in Ukraine and prospects for FY 2022 and 2023
The crisis in Ukraine has led to a global disruption that has undermined the post-Covid recovery and fuelled inflation. In this context, economic actors are adopting a wait-and-see attitude and tend to delay their decisionmaking. Under these conditions, the real estate sector is experiencing a slowdown.
However, both the climatic events of this summer and the energy market, and in particular the gas market, have highlighted, each in their own way, the urgent need to reduce carbon emissions and energy consumption. The role of real estate in this energy transition is fundamental.
ATENOR therefore faces a high degree of uncertainty regarding the timing of the 2022 results, but confirms excellent prospects as early as 2023, even higher if there is a postponement from 2022 to 2023. We believe that the Ukrainian crisis and the current level of inflation will not have a long-term effect on the value of ongoing projects or, in general, on the valuation of ATENOR's core business.
Dividend policy
ATENOR intends to maintain its dividend policy of providing shareholders with attractive and recurrent returns. The gross amount of the last dividend paid, on 28 April 2022, was €2.54 (versus €2.42 in 2021).
Events subsequent to the closing date
As announced in the press release published on August 29, 2022 the Board of Directors has approved the appointment of Value Add Consulting SRL, represented by Mr Laurent Jacquemart, as a member of ATENOR's Executive Committee. It has appointed him as Chief Financial Officer to replace Mr Sidney D. Bens, with effect as of 5 September 2022.
No other major event is to be noted since 30 June 2022.
Financial calendar
Intermediate declaration for third quarter 2022 17 November 2022 Publication of the annual results for 2022 March 2023 Annual General Meeting 2022 28 April 2023
Contact and Information
For more detailed information, please contact Stéphan Sonneville SA, CEO or Sidney D. Bens, CFO.
+32-2-387.22.99 - +32-2-387.23.16 - e-mail: [email protected] - www.atenor.eu
D. Condensed Financial Statements
Consolidated statement of comprehensive income
| In thousands of EUR | ||||
|---|---|---|---|---|
| Notes | 30.06.2022 | 30.06.2021 | ||
| Operating revenue | 12.118 | 132.715 | ||
| Turnover | 9.907 | 129.094 | ||
| Property rental income | 2.211 | 3.621 | ||
| Other operating income | 18.768 | 9.636 | ||
| Gain (loss) on disposals of financial assets | 13.091 | 146 | ||
| Other operating income | 5.678 | 9.490 | ||
| Gain (loss) on disposals of non-financial assets | -1 | |||
| Operating expenses (-) | -12.453 | -100.480 | ||
| Raw materials and consumables used (-) | -87.447 | -229.365 | ||
| Changes in inventories of finished goods and work in progress | 96.666 | 179.121 | ||
| Employee expenses (-) | -2.346 | -2.229 | ||
| Depreciation and amortization (-) | 8 | -416 | -332 | |
| Impairments (-) | 9 | 5.557 | 225 | |
| Other operating expenses (-) | -24.467 | -47.900 | ||
| RESULT FROM OPERATING ACTIVITIES - EBIT | 18.433 | 41.871 | ||
| Financial expenses (-) | -8.495 | -5.974 | ||
| Financial income | 718 | 633 | ||
| Share of profit (loss) from investments consolidated by the equity method | 1 0 |
-1.079 | -1.509 | |
| PROFIT (LOSS) BEFORE TAX | 9.577 | 35.021 | ||
| Income tax expense (income) (-) | 5 | -673 | -5.501 | |
| PROFIT (LOSS) AFTER TAX | 8.904 | 29.520 | ||
| Post-tax profit (loss) of discontinued operations | 0 | 0 | ||
| PROFIT (LOSS) OF THE PERIOD | 8.904 | 29.520 | ||
| Non controlling interests | -92 | -84 | ||
| Group profit (loss) | 8.996 | 29.604 |
EARNINGS PER SHARE
| 30.06.2022 | 30.06.2021 | |
|---|---|---|
| Total number of issued shares | 7.038.845 | 7.038.845 |
| of which own shares | 313.427 | 313.427 |
| Weighted average number of shares (excluding own shares) | 6.724.748 | 6.724.537 |
| Basic earnings per share | 1,34 | 4,40 |
| Diluted earnings per share | 1,34 | 4,40 |
| Other elements of the overall profit and losses | ||
| 30.06.2021 | 30.06.2021 | |
| Group share result | 8.996 | 29.604 |
| Items not to be reclassified to profit or loss in subsequent periods : | ||
| Employee benefits | ||
| Items to be reclassified to profit or loss in subsequent periods : | ||
| Translation adjusments | -8.359 | 24.071 |
| Cash flow hedge 1 3 |
323 | 8 8 |
| Overall total results of the group | 960 | 53.763 |
Overall profits and losses of the period attributable to third parties -92 -84
D. Condensed Financial Statements (continued)
Consolidated statement of the financial position
ASSETS
| In thousands of EUR | ||||
|---|---|---|---|---|
| Notes | 30.06.2022 | 30.06.2021 | 31.12.2021 | |
| NON-CURRENT ASSETS | 219.332 | 147.013 | 163.092 | |
| Property, plant and equipment | 8 | 8.604 | 3.390 | 4.480 |
| Investment property | 9 | 21.482 | ||
| Intangible assets | 6 9 |
3 2 |
2 5 |
|
| Investments consolidated by the equity method | 1 0 |
81.964 | 62.991 | 78.729 |
| Deferred tax assets | 3.131 | 4.572 | 3.267 | |
| Other non-current financial assets | 1 2 |
92.629 | 52.971 | 56.986 |
| Non-current trade and other receivables | 1 2 |
11.453 | 23.057 | 19.605 |
| CURRENT ASSETS | 975.602 | 1.024.421 | 1.066.722 | |
| Inventories | 1 1 |
872.083 | 846.509 | 932.994 |
| Other current financial assets | 1 2 |
4.385 | 9.851 | 1.523 |
| Current tax assets | 924 | 1.512 | 3.755 | |
| Current trade and other receivables | 71.259 | 135.275 | 24.770 | |
| Current loans payments | 1 0 |
1 5 |
2 5 |
|
| Cash and cash equivalents | 1 2 |
18.243 | 26.425 | 90.881 |
| Other current assets | 8.698 | 4.834 | 12.774 | |
| TOTAL ASSETS | 1.194.934 | 1.171.434 | 1.229.814 |
LIABILITIES AND EQUITY
| 30.06.2022 | 30.06.2021 | 31.12.2021 | ||
|---|---|---|---|---|
| TOTAL EQUITY | 284.833 | 298.651 | 301.043 | |
| Group shareholders' equity | 282.445 | 296.087 | 298.563 | |
| Issued capital | 133.621 | 133.621 | 133.621 | |
| Reserves | 163.897 | 177.539 | 180.015 | |
| Treasury shares (-) | -15.073 | -15.073 | -15.073 | |
| Non controlling interest | 2.388 | 2.564 | 2.480 | |
| Non-current liabilities | 560.703 | 516.212 | 510.036 | |
| Non-current interest bearing borrowings | 1 3 |
530.141 | 480.722 | 478.580 |
| Non-current provisions | 4.795 | 20.136 | 9.526 | |
| Pension obligation | 1.094 | 902 | 1.094 | |
| Derivatives | 1 3 |
-140 | 279 | 184 |
| Deferred tax liabilities | 764 | 619 | 594 | |
| Non-current trade and other payables | 22.744 | 12.481 | 18.791 | |
| Other non-current liabilities | 1.305 | 1.073 | 1.267 | |
| Current liabilities | 349.398 | 356.571 | 418.735 | |
| Current interest bearing debts | 1 3 |
294.988 | 296.439 | 355.963 |
| Current provisions | 5.340 | 153 | 4.512 | |
| Current tax payables | 4.390 | 5.922 | 6.995 | |
| Current trade and other payables | 36.155 | 42.571 | 42.563 | |
| Other current liabilities | 8.525 | 11.486 | 8.702 | |
| TOTAL EQUITY AND LIABILITIES | 1.194.934 | 1.171.434 | 1.229.814 |
D. Condensed Financial Statements (continued)
Consolidated cash flow statement (indirect method)
| 30.06.2022 30.06.2021 Operating activities - Net income (group share) 8.996 29.604 - Result of non controlling interests -92 -84 10 - Result of Equity method Cies 1.079 1.509 - Interest charges 7.548 5.321 - Interest incomes -717 -628 5 - Income tax expense 367 4.987 Adjusted operating result 17.181 40.709 8 - Depreciations 416 332 - Impairment losses 487 -225 - Translation adjustments 341 762 9 - Fair value adjustments -6.044 0 - Provisions (Increases / Reversals) -5.639 6.027 5 - Deferred taxes (Increases / Reversals) 306 514 - (Profit)/Loss on disposal of fixed assets -13.091 -146 - SOP / IAS 19 0 3 2 Adjustments for non cash items -23.224 7.296 - Variation of inventories -98.632 -182.101 - Variation of trade and other amounts receivables 1.956 -75.854 - Variation of trade payables 3.668 5.857 - Variation of amounts payable regarding wage taxes -635 -255 - Variation of other receivables and payables 421 -34.246 Net variation on working capital -93.222 -286.599 - Interests received 717 628 - Income tax (paid) paid -3.032 -2.568 - Income tax (paid) received 3.018 323 Cash from operating activities (+/-) -98.562 -240.211 Investment activities - Acquisitions of intangible and tangible fixed assets -199 -194 - Acquisitions of financial investments 0 -31.120 - New loans -5.152 -3.912 Subtotal of acquired investments -5.351 -35.226 - Disposals of intangible and tangible fixed assets 0 0 - Disposals of financial investments 6.000 63.918 - Reimbursement of loans 68 2 Subtotal of disinvestments 6.068 63.920 Cash from investment activities (+/-) 717 28.694 Financial activities - New borrowings 119.213 220.170 309.743 - Repayment of borrowings -65.018 -21.651 - Interests paid -8.082 -3.069 |
Notes | |||
|---|---|---|---|---|
| 31.12.2021 | ||||
| 38.069 | ||||
| -168 | ||||
| 2.480 | ||||
| 11.617 | ||||
| -1.569 | ||||
| 10.013 | ||||
| 60.442 | ||||
| 788 | ||||
| 204 | ||||
| -299 | ||||
| 0 | ||||
| -551 | ||||
| 1.867 | ||||
| -4.511 | ||||
| 0 | ||||
| -2.502 | ||||
| -320.830 | ||||
| 80.562 | ||||
| 8.199 | ||||
| 384 | ||||
| -34.913 | ||||
| -266.598 | ||||
| 1.569 | ||||
| -8.524 | ||||
| 230 | ||||
| -215.383 | ||||
| -656 | ||||
| -46.898 | ||||
| -8.005 | ||||
| -55.559 | ||||
| 6 | ||||
| 71.752 | ||||
| 85 | ||||
| 71.843 | ||||
| 16.284 | ||||
| -54.900 | ||||
| 6 | -8.904 | |||
| - Dividends paid to company's shareholders -17.078 -16.272 |
-16.272 | |||
| - Directors' entitlements -410 -410 |
-410 | |||
| Cash from financial activities (+/-) 28.625 178.768 |
229.257 | |||
| Net variation ot the period -69.220 -32.749 |
30.158 | |||
| - Cash and cash equivalent at the beginning of the year 92.116 67.887 |
67.887 | |||
| - Net variation in cash and cash equivalent -69.220 -32.749 |
30.158 | |||
| - Effect of exchange rate changes -583 564 |
-5.929 | |||
| - Cash and cash equivalent at end of the year 1 2 22.313 35.702 |
92.116 |
D. Condensed Financial Statements (continued)
Consolidated statement of change in equity
| Note | Issued capital | share issue premium |
Hedging reserves | Own shares | Consolidated reserves |
IAS 19R reserves |
Cumulative translation |
Minority interests |
Total Equity | |
|---|---|---|---|---|---|---|---|---|---|---|
| In thousands of EUR | adjusments | |||||||||
| 2 0 2 1 | ||||||||||
| Balance as of 01.01.2021 | 72.039 | 61.582 | -367 | -15.073 | 173.464 | -841 | -32.240 | 2.648 | 261.212 | |
| Profit/loss of the period | - | - | - | - | 38.069 | - | - | -168 | 37.901 | |
| Other elements of the overall results | - | 183 | - | - | -168 | 18.705 | - | 18.720 | ||
| Total comprehensive income | - | - | 183 | - | 38.069 | -168 | 18.705 | -168 | 56.621 | |
| Paid dividends | 6 | - | - | - | - | -16.272 | - | - | - | -16.272 |
| Other | - | - | - | - | -518 | - | - | - | -518 | |
| Balance as of 31.12.2021 | 72.039 | 61.582 | -184 | -15.073 | 194.743 | -1.009 | -13.535 | 2.480 | 301.043 | |
| First semester 2 0 2 1 | ||||||||||
| Balance as of 01.01.2021 | 72.039 | 61.582 | -367 | -15.073 | 173.464 | -841 | -32.240 | 2.648 | 261.212 | |
| Profit/loss of the period | - | - | - | - | 29.604 | - | - | -84 | 29.520 | |
| Other elements of the overall results | - | - | 88 | - | - | 24.071 | - | 24.159 | ||
| Total comprehensive income | - | - | 88 | - | 29.604 | - | 24.071 | -84 | 53.679 | |
| Paid dividends | 6 | - | - | - | - | -16.272 | - | - | - | -16.272 |
| Share based payment / Valuation | - | - | - | - | 32 | - | - | - | 3 2 |
|
| Balance as of 30.06.2021 | 72.039 | 61.582 | -279 | -15.073 | 186.828 | -841 | -8.169 | 2.564 | 298.651 | |
| First semester 2 0 2 2 | ||||||||||
| Balance as of 01.01.2022 | 72.039 | 61.582 | -184 | -15.073 | 194.743 | -1.009 | -13.535 | 2.480 | 301.043 | |
| Profit/loss of the period | - | - | - | - | 8.996 | - | - | (92) | 8.904 | |
| Other elements of the overall results | - | - | 323 | - | - | - | -8.359 | - | -8.036 | |
| Total comprehensive income | - | - | 323 | - | 8.996 | - | (8.359) | (92) | 868 | |
| Paid dividends | 6 | - | - | - | - | -17.078 | - | - | - | -17.078 |
| Balance as of 30.06.2022 | 72.039 | 61.582 | 139 | -15.073 | 186.661 | -1.009 | -21.894 | 2.388 | 284.833 |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS AS AT 30/06/2022
Note 1. Corporate information
The Group's consolidated half-year financial statements as at June 2022 were adopted by the Board of Directors meeting on 31 August 2022.
Note 2. Principal accounting methods
1. Basis for preparation
The condensed consolidated financial statements as of June 30, 2022, have been prepared in accordance with the IFRS (International Financial Reporting Standards) IAS 34 Interim Financial Reporting standards as issued by the International Accounting Standards Board (IASB), and as adopted by the European Union.
They do not include all of the information required for the full annual financial statements and should be read in conjunction with the company's consolidated financial statements for the year ending 31 December 2021.
ATENOR has not applied any new IFRS provisions that have not come into force in 2022 and has not applied any European exceptions to IFRS.
The new IFRS standards and IFRIC interpretations and the amendments to the old standards and interpretations, which apply for the first time in 2022, have not a significant direct impact on the figures reported by ATENOR.
2. Consolidation principles and significant accounting principles
The evaluation rules adopted for the preparation of the consolidated financial situation as at 30 June 2022 were maintained as to the rules followed for the preparation of the annual report as at 31 December 2021. However, the Board of Directors meeting of 31 August 2022 endorsed the application of IAS 40 "Investment Property" as of the 2022 half-year closing.
This evaluation rule is as follows:
Investment property and real property
ATENOR's activities in the field of real estate development may lead the group to hold various types of buildings categorised by the use to which they are assigned:
- Investment property (IAS 40 Investment property): property held in a portfolio for the purpose of earning rents; and
- Projects under development recognised in inventory (IAS 2 Inventory and IFRS 15 Revenue from ordinary activity derived from contracts with clients).
Each category has its own specific accounting principles for the recognition of assets at inception and their subsequent measurement.
Assets held as investment property represent real estate held to earn rents or real estate leased on a long-term basis pending either the implementation of a medium-term real estate project or the sale of the asset.
Investment property is initially recognized at cost, including related transaction costs (legal fees, transfer fees, and other transaction costs) and, where applicable, borrowing costs. After initial recognition, investment property is accounted for at its fair value.
Investment property under development is measured at fair value less estimated costs of completion if the fair value can be reliably determined. Investment property under construction whose fair value cannot be reliably determined is measured at cost less depreciation until the fair value can be reliably determined. The cost of investment property under development includes attributable interest and other related expenses. Interest is calculated on development expenditure by reference to a specific loan. Where applicable, interest is not capitalised when no development activity takes place. A property ceases to be under development when it is completed.
Fair value measurement
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the valuation date. Fair value is based on active market prices, adjusted, if necessary, for differences in the nature, location, or condition of the specific asset.
If such information is not available, ATENOR uses alternative valuation methods, such as recent prices in less active markets or discounted cash flow projections. Valuations are performed as of the balance sheet date by professional appraisers who have recognised and relevant qualifications and recent experience in the location and category of investment property being appraised.
The fair value of investment property reflects, among other things, rental income from current leases and other assumptions that market participants would make when setting the price of the property under current market conditions. Changes in fair value are recognised in the consolidated statement of comprehensive income.
Subsequent expenditures
- Subsequent expenditures are capitalised to the book value of the asset only when it is likely that future economic benefits associated with those expenditures will be generated and the cost of the item can be reliably measured. All other repair and maintenance costs are recognised as expenses at the time they are incurred. When a part of an investment property is replaced, the book value of the replaced part is derecognised.
- An investment property is derecognised on disposal or when the investment property is permanently withdrawn from use and no future economic benefits are expected from the disposal. Any gain or loss resulting from derecognition of the property (calculated as the difference between the net proceeds of disposal and the carrying amount of the asset) is included in the consolidated statement of comprehensive income for the period in which the property is derecognised.
3. Accounting estimates and significant judgements
The significant judgements made by management to apply the company's accounting principles and the main sources of uncertainty are similar to those used for the consolidated annual financial statements for the year ended 31 December 2021, except for the situations described below:
Fair value of investment property
The fair value of investment property is determined by independent appraisers using valuation techniques. Models used to measure investment property may include the net present value of estimated future cash flows, the capitalisation approach, and/or recent transactions on comparable properties. To determine the data used in the valuation calculations, management must make judgements and estimates. See Note 9 for further details on the judgements and assumptions made.
The global political and economic situation calls for caution among economic actors. Several factors are impacting the real estate sector:
˃ Negative impacts
The increase in construction costs and mainly in the cost of certain materials.
The shortage of certain materials and skilled labor.
The increase of interest rates.
Yield increases.
˃ Positive impacts
The indexation of rents
The need to reduce energy bills and ensure energy independence.
The implementation of NWOW with a view, in particular, to promoting the talent retention and the post Covid return of employees to the office.
The imperatives of sustainable development (Green Deal, taxonomy) which are spreading in all sectors of the economy, including in the management of portfolios by investors.
Through its proactive management of ongoing projects and constructions, ATENOR has been able to reduce the negative impacts to insignificant consequences to date.
However, these macroeconomic and political circumstances suffered in the wake of the Covid health crisis impact ATENOR in terms of timing of results. The announced slowdown in the global economy adds a degree of uncertainty in this regard.
Note 3. Seasonal information
The life cycle of ATENOR's real property projects can be summarised in three major phases: the land purchase phase, the project development and construction phase, and the marketing and sales phase. The length and process of these phases are neither similar nor comparable from one project to another.
Monitoring of and compliance with the schedules of each of these projects are assured by the implementation of a regular communication system. Internal control is provided by:
- an executive committee that meets monthly for each of the projects and is formalised by minutes.
When a project reaches the construction phase, a monthly progress meeting is held with:
- the external specialists to ensure that the agreed-upon deadlines are complied with, and
- the General Contractor in charge of construction.
This communication system allows ATENOR to determine, monitor, and resolve all potential operational risks well upfront.
Note 4. Segment reporting
Segment information is prepared, both for internal reporting and external disclosure, on a single sector of activity, i.e. real property development projects (office and residential properties, the retail activity being accessory to the first two mentioned). This activity is presented, managed, and monitored on a project-by-project basis. The various project committees, Executive Committee, and Board of Directors are responsible for monitoring the various projects and assessing their performance. However, based on the location of the projects, two geographical segments are henceforth identifiable: on the one hand there is Western Europe, covering Belgium, the
Grand Duchy of Luxembourg, the Netherlands, France, Germany, Portugal, and the United Kingdom, and, on the other hand, there is Central Europe, covering Poland, Hungary, and Romania.
Taken at 30 June 2022, this segmentation mainly highlights the contribution to the consolidated result of the projects in Western Europe.
| In thousands of EUR | 30.06.2022 | 30.06.2021 | 31.12.2021 | ||||||
|---|---|---|---|---|---|---|---|---|---|
| Western Europe |
Central Europe |
Total | Western Europe |
Central Europe |
Total | Western Europe |
Central Europe |
Total | |
| Operating revenue | 9.180 | 2.938 | 12.118 | 36.144 | 96.571 | 132.715 | 74.675 | 99.443 | 174.118 |
| Turnover | 7.993 | 1.914 | 9.907 | 35.385 | 93.709 | 129.094 | 72.917 | 95.151 | 168.068 |
| Property rental income | 1.187 | 1.024 | 2.211 | 759 | 2.862 | 3.621 | 1.758 | 4.292 | 6.050 |
| Other operating income | 14.580 | 4.188 | 18.768 | 8.285 | 1.351 | 9.636 | 20.090 | 3.124 | 23.214 |
| Gain (loss) on disposals of financial assets | 13.091 | 13.091 | 146 | 146 | 4.505 | 4.505 | |||
| Other operating income | 1.490 | 4.188 | 5.678 | 8.139 | 1.351 | 9.490 | 15.579 | 3.124 | 18.703 |
| Gain (loss) on disposals of non-financial assets | -1 | -1 | 0 | 6 | 6 | ||||
| Operating expenses (-) | -6.407 | -6.046 | -12.453 | -40.978 | -59.502 | -100.480 | -74.932 | -58.237 | -133.169 |
| Raw materials and consumables used (-) | -45.474 | -41.973 | -87.447 | -169.429 | -59.936 | -229.365 | -269.662 | -91.501 | -361.163 |
| Changes in inventories of finished goods and work in | |||||||||
| progress | 55.152 | 41.514 | 96.666 | 162.959 | 16.162 | 179.121 | 260.788 | 53.920 | 314.708 |
| Employee expenses (-) | -1.931 | -415 | -2.346 | -1.857 | -372 | -2.229 | -3.912 | -864 | -4.776 |
| Depreciation and amortization (-) | -320 | -96 | -416 | -235 | -97 | -332 | -573 | -215 | -788 |
| Impairments (-) | 5.557 | 5.557 | 123 | 102 | 225 | -256 | 5 2 |
-204 | |
| Other operating expenses (-) | -19.391 | -5.076 | -24.467 | -32.539 | -15.361 | -47.900 | -61.317 | -19.629 | -80.946 |
| RESULT FROM OPERATING ACTIVITIES - EBIT | 17.353 | 1.080 | 18.433 | 3.451 | 38.420 | 41.871 | 19.833 | 44.330 | 64.163 |
| Financial expenses (-) | -10.092 | 1.597 | -8.495 | -6.846 | 872 | -5.974 | -15.673 | 2.195 | -13.478 |
| Financial income | 718 | 718 | 633 | 633 | 1.576 | 1.576 | |||
| Share of profit (loss) from investments consolidated by | |||||||||
| the equity method | -1.079 | -1.079 | -1.509 | -1.509 | -2.480 | -2.480 | |||
| PROFIT (LOSS) BEFORE TAX | 6.900 | 2.677 | 9.577 | -4.271 | 39.292 | 35.021 | 3.256 | 46.525 | 49.781 |
| Income tax expense (income) (-) | -669 | -4 | -673 | -1.840 | -3.661 | -5.501 | -8.014 | -3.866 | -11.880 |
| PROFIT (LOSS) AFTER TAX | 6.231 | 2.673 | 8.904 | -6.111 | 35.631 | 29.520 | -4.758 | 42.659 | 37.901 |
| Post-tax profit (loss) of discontinued operations | -1.840 | -3.661 | -5.501 | ||||||
| PROFIT (LOSS) OF THE PERIOD | 6.231 | 2.673 | 8.904 | -6.111 | 35.631 | 29.520 | -4.758 | 42.659 | 37.901 |
| Intercompany elimination | 1.737 | -1.737 | 0 | 1.426 | -1.426 | 0 | 2.837 | -2.837 | 0 |
| CONSOLIDATED RESULT | 7.968 | 936 | 8.904 | -4.685 | 34.205 | 29.520 | -1.921 | 39.822 | 37.901 |
| Overall profits and losses of the period attributable | |||||||||
| to third parties | -92 | -92 | -84 | -84 | -168 | -168 | |||
| Group share result | 8.060 | 936 | 8.996 | -4.601 | 34.205 | 29.604 | -1.753 | 39.822 | 38.069 |
| 30.06.2022 | 30.06.2021 | 31.12.2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|
| Western | Central | Western | Central | Western | Central | ||||
| In thousands of EUR | Europe | Europe | Total | Europe | Europe | Total | Europe | Europe | Total |
| ASSETS | |||||||||
| NON-CURRENT ASSETS | 218.713 | 619 | 219.332 | 146.575 | 438 | 147.013 | 162.664 | 428 | 163.092 |
| Property, plant and equipment | 8.100 | 504 | 8.604 | 2.963 | 427 | 3.390 | 4.128 | 352 | 4.480 |
| Investment properties | 21.482 | 21.482 | |||||||
| Intangible assets | 2 1 |
4 8 |
6 9 |
2 7 |
5 | 3 2 |
2 1 |
4 | 2 5 |
| Investments consolidated | |||||||||
| by the equity method | 81.964 | 81.964 | 62.991 | 62.991 | 78.729 | 78.729 | |||
| Deferred tax assets | 3.131 | 3.131 | 4.572 | 4.572 | 3.267 | 3.267 | |||
| Other non-current financial assets | 92.562 | 6 7 |
92.629 | 52.965 | 6 | 52.971 | 56.914 | 7 2 |
56.986 |
| Non-current trade and other receivables | 11.453 | 11.453 | 23.057 | 23.057 | 19.605 | 19.605 | |||
| CURRENT ASSETS | 653.685 | 321.917 | 975.602 | 726.738 | 297.683 | 1.024.421 | 788.665 | 278.057 | 1.066.722 |
| Assets held for sale | |||||||||
| Inventories | 577.553 | 294.530 | 872.083 | 575.639 | 270.870 | 846.509 | 674.026 | 258.968 | 932.994 |
| Other current financial assets | 4.385 | 4.385 | 9.851 | 9.851 | 1.523 | 1.523 | |||
| Current tax receivables | 568 | 356 | 924 | 1.415 | 9 7 |
1.512 | 3.551 | 204 | 3.755 |
| Current trade and other receivables | 61.929 | 9.330 | 71.259 | 123.811 | 11.464 | 135.275 | 19.088 | 5.682 | 24.770 |
| Current loans payments | 1 0 |
1 0 |
1 5 |
1 5 |
2 5 |
2 5 |
|||
| Cash and cash equivalents Other current assets |
4.425 4.815 |
13.818 3.883 |
18.243 8.698 |
13.429 2.578 |
12.996 2.256 |
26.425 4.834 |
80.759 9.693 |
10.122 3.081 |
90.881 12.774 |
| TOTAL ASSETS | 872.398 | 322.536 | 1.194.934 | 873.313 | 298.121 | 1.171.434 | 951.329 | 278.485 | 1.229.814 |
| LIABILITIES AND EQUITY | |||||||||
| TOTAL EQUITY | 300.035 | -15.202 | 284.833 | 275.948 | 22.703 | 298.651 | 309.152 | -8.109 | 301.043 |
| Group shareholders' equity | 297.647 | -15.202 | 282.445 | 273.384 | 22.703 | 296.087 | 306.672 | -8.109 | 298.563 |
| Issued capital | 133.621 | 133.621 | 133.621 | 133.621 | 133.621 | 133.621 | |||
| Reserves | 179.099 | -15.202 | 163.897 | 154.836 | 22.703 | 177.539 | 188.124 | -8.109 | 180.015 |
| Treasury shares (-) | -15.073 | -15.073 | -15.073 | -15.073 | -15.073 | -15.073 | |||
| Non controlling interest | 2.388 | 2.388 | 2.564 | 2.564 | 2.480 | 2.480 | |||
| Non-current liabilities | 528.725 | 31.978 | 560.703 | 475.556 | 40.656 | 516.212 | 476.249 | 33.787 | 510.036 |
| Non-current interest bearing borrowings | 512.898 | 17.243 | 530.141 | 462.531 | 18.191 | 480.722 | 460.962 | 17.618 | 478.580 |
| Non-current provisions | 3.528 | 1.267 | 4.795 | 4.621 | 15.515 | 20.136 | 4.795 | 4.731 | 9.526 |
| Pension obligation | 1.094 | 1.094 | 902 | 902 | 1.094 | 1.094 | |||
| Derivatives | -140 | -140 | 279 | 279 | 184 | 184 | |||
| Deferred tax liabilities | 764 | 764 | 546 | 7 3 |
619 | 594 | 594 | ||
| Non-current trade and other payables | 10.387 | 12.357 | 22.744 | 6.956 | 5.525 | 12.481 | 8.775 | 10.016 | 18.791 |
| Other non-current liabilities | 5 4 |
1.251 | 1.305 | 1.073 | 1.073 | 2 9 |
1.238 | 1.267 | |
| Current liabilities | 43.638 | 305.760 | 349.398 | 121.809 | 234.762 | 356.571 | 165.928 | 252.807 | 418.735 |
| Current interest bearing debts | 293.801 | 1.187 | 294.988 | 295.290 | 1.149 | 296.439 | 354.811 | 1.152 | 355.963 |
| Current provisions | 910 | 4.430 | 5.340 | 153 | 153 | 2.135 | 2.377 | 4.512 | |
| Deferred tax liabilities | 4.386 | 4 | 4.390 | 2.250 | 3.672 | 5.922 | 4.193 | 2.802 | 6.995 |
| Current trade and other payables | 25.049 | 11.106 | 36.155 | 29.823 | 12.748 | 42.571 | 32.467 | 10.096 | 42.563 |
| Other current liabilities | 7.787 | 738 | 8.525 | 10.881 | 605 | 11.486 | 8.164 | 538 | 8.702 |
| Intercompany elimination / not allocated | -288.295 | 288.295 | -216.588 | 216.588 | -235.842 | 235.842 | |||
| TOTAL EQUITIES AND LIABILITIES | 872.398 | 322.536 | 1.194.934 | 873.313 | 298.121 | 1.171.434 | 951.329 | 278.485 | 1.229.814 |
Note 5. Income taxes and deferred taxes
| In thousands of EUR | |||||||
|---|---|---|---|---|---|---|---|
| TAXES | 30.06.2022 | 30.06.2021 | 31.12.2021 | ||||
| Income tax expense / Income - current | |||||||
| Current period tax expense | -361 | -5.090 | -10.839 | ||||
| Adjustments to tax expense/income of prior periods | -6 | 103 | 826 | ||||
| Total current tax expense, net | -367 | -4.987 | -10.013 | ||||
| Income tax expense / Income - Deferred | |||||||
| Related to the current period | -169 | -576 | -223 | ||||
| Related to tax losses | -137 | 6 2 |
-1.644 | ||||
| Total deferred tax expense | -306 | -514 | -1.867 | ||||
| Total current and deferred tax expense | -673 | -5.501 | -11.880 |
For the six-month period ending June 30, 2022, the tax expense amounts to €0.67 million and is mainly composed of current and deferred tax liabilities relating to the City Dox and Twist projects.
As a reminder, as of June 30, 2021, taxes amounted to €5.50 million. They were mainly composed of current and deferred tax liabilities relating to the Vaci Greens, City Dox, Buzz, and Au Fil des Grands Prés projects for a total of €5.43 million.
Note 6. Paid dividends
| In thousands of EUR | |||||
|---|---|---|---|---|---|
| 30.06.2022 | 30.06.2021 | 31.12.2021 | |||
| Dividends on ordinary shares declared and paid during the period: Final dividend for 2021: € 2.54 Final dividend for 2020: € 2.42 |
-17.078 | -16.272 | -16.272 |
ATENOR offers no interim dividends.
Note 7. Capital
For the six-month period ending June 30, 2022, there was no change in the capital structure; the reference shareholders remain the same.
The movements on own shares are as follows:
| MOVEMENTS IN OWN SHARES | Amount (in thousands of €) |
Number of shares |
|---|---|---|
| On 31.12.2021 (average price € 48.09 per share) | 15.073 | 313.427 |
| Movements during the period - acquisitions - sales |
105 -105 |
1.834 -1.834 |
| On 30.06.2022 (average price € 48.09 per share) | 15.073 | 313.427 |
As a reminder, ATENOR SA no longer holds any own shares as at 30/06/2022 (situation unchanged from 31 December 2021). The Atenor Group Investments and Atenor Long Term Growth subsidiaries always hold 163,427 and 150,000 ATENOR shares respectively (situation unchanged from 31 December 2021).
These shares aim to enhance the AGI (2018) and ALTG (2019 to 2022) stock option plans allocated to ATENOR staff and some of its service providers.
The shares acquired during the first half-year were acquired and immediately sold as partial payment of remuneration in the form of company shares.
Note 8. Property, plant, and equipment
"Tangible assets" totalled €8.60 million as at 30 June 2022, versus €4.48 million as at 31 December 2021. This includes the group's furniture and rolling stock, fixtures and improvements made to rented properties and the rights to use the rented properties (IFRS 16).
Investments total €4.12 M for the year and are mainly related to the recognition of land use rights (150 years) for the Fleet House project in England.
Depreciation for the 6-month period ending 30 June 2022 amounted to €0.42 million (6-month period ending 30 June 2021: €0.33 million). No impairment loss was recognised.
Note 9. Investment properties
This item includes the Nysdam building in La Hulpe. This building is currently 94% leased and generates net rental income of €0.48 million as at June 30, 2022. The building is currently under management and may subsequently be redeveloped or sold.
It was therefore transferred from inventory and, in application of IAS 40, valued at its net fair value of €21.48 million, based on an expert's report as at June 30, 2022 (30 June 2021: Nil). Based on data from the valuation technique, the fair value of the investment property was classified as Level 3 fair value.
Fair value measurement
Investment property is the company's only asset that is measured at fair value on a recurring basis.
The fair value of investment property (including investment property held by joint ventures) is determined by professionally qualified independent appraisers using valuation techniques that meet recognised international professional appraisal standards.
ATENOR determines that the fair value established reflects the maximum and optimal use of the investment property by the company. Models used to measure investment property may include the net current value of estimated future cash flows and/or recent transactions on comparable properties.
The property's fair value was determined on the basis of discounted cash flows using equivalent returns of between 5.50% and 7.0%. This data includes:
- Future rental cash inflows: Based on the actual location, type, and quality of the properties and supported by the terms of any existing lease, other contracts, or external evidence such as current market rents for similar properties.
- Discount rate: discount rate reflecting current market assessments of uncertainty as to the amount and timing of cash flows;
- Estimated vacancy rates: based on current and future market conditions after the expiration of any current lease;
- Maintenance costs: including the investments necessary to maintain the functionality of the property during its intended useful life;
- Capitalisation rate: based on the actual location, size, and quality of the properties, and taking into account market data at the valuation date;
- Final value: taking into account assumptions about maintenance costs, vacancy rates, and market rents.
| In thousands of EUR | 30.06.2022 |
|---|---|
| At the end of the preceding period | 0 |
| Gains / (losses) arising from changes in the fair value | 6.044 |
| Investments | 36 |
| Transfer from "Inventories" (at cost) | 15.402 |
| At the end of the period | 21.482 |
There was no transfer from Level 3 to Level 2 during the 6-month period ending 30 June 2022.
Note 10. Investments consolidated by the equity method
| In thousands of EUR | ||||
|---|---|---|---|---|
| Participations | 30.06.2022 | 30.06.2021 | 31.12.2021 | |
| VICTOR ESTATES | 883 | 968 | 926 | |
| VICTOR PROPERTIES | 3 8 |
4 6 |
4 0 |
|
| VICTOR BARA | 4.294 | 4.332 | 4.312 | |
| VICTOR SPAAK | 7.687 | 7.752 | 7.718 | |
| IMMOANGE | 701 | 795 | 719 | |
| MARKIZAAT | 10.300 | 10.093 | 10.183 | |
| CCN DEVELOPPEMENT | 49.697 | 34.958 | 50.113 | |
| DE MOLENS | 220 | 1 4 |
125 | |
| CLOCHE D'OR DEVELOPMENT | 3.751 | |||
| TEN BRINKE MYBOND VERHEESKADE | 4.307 | 4.232 | 4.386 | |
| LAAKHAVEN VERHEESKADE II | 8 6 |
299 | 207 | |
| LANKELZ FONCIER | -498 | |||
| Total | 81.964 | 62.991 | 78.729 |
| In thousands of EUR | ||||
|---|---|---|---|---|
| Movements of participations | 30.06.2022 | 30.06.2021 | 31.12.2021 | |
| At the end of the preceding period | 78.729 | 64.180 | 64.180 | |
| Share in result | -1.079 | -1.509 | -2.480 | |
| Acquisitions, price adjustments and | ||||
| restructuring | 3.918 | 320 | 16.098 | |
| Reclassification to other items | 396 | 931 | ||
| At the end of the period | 81.964 | 62.991 | 78.729 |
| In thousands of EUR | |||
|---|---|---|---|
| Sums due to the | |||
| Sums due to related | group from related | ||
| parties | parties | ||
| IMMOANGE | - | 1.634 | |
| VICTOR ESTATES | - | 5.304 | |
| VICTOR PROPERTIES | - | 295 | |
| VICTOR BARA | - | 2.266 | |
| VICTOR SPAAK | - | 4.018 | |
| MARKIZAAT | 5.495 | ||
| CCN DEVELOPMENT | - | 810 | |
| CLOCHE D'OR DEVELOPMENT | 30.753 | ||
| DE MOLENS | - | 1.537 | |
| TEN BRINKE MYBOND VERHEESKADE | - | 7.832 | |
| LAAKHAVEN VERHEESKADE II | - | 14.831 | |
| LANKELZ FONCIER | - | 15.356 |
In 2019, ATENOR entered into a partnership (33%) with AGRE and AXA through CCN Development as part of the CCN Brussels project. This participation has been increased to 50% in 2021.
Following the sale of 50% of Cloche d'Or Development stake in June 2022, the latter is now recognised under the equity method.
No other important change occurred concerning the related parties during the first half of 2022.
Note 11. Inventory
| In thousands of EUR | |||
|---|---|---|---|
| 30.06.2022 | 30.06.2021 | 31.12.2021 | |
| Buildings intended for sale, beginning balance | 932.994 | 775.706 | 775.706 |
| Activated costs | 102.193 | 253.646 | 404.663 |
| Disposals of the year | -6.173 | -74.705 | -90.262 |
| Exits from the consolidation scope | -135.912 | -114.042 | -159.971 |
| Transfers from/to the "Inventories" | -13.690 | ||
| Borrowing costs (IAS 23) | 2.612 | 3.160 | 6.429 |
| Foreign currency exchange increase (decrease) | -9.427 | 2.619 | -3.604 |
| Write-offs (written back) | 125 | 375 | |
| Movements during the year | -60.911 | 70.803 | 157.287 |
| Buildings intended for sale, ending balance | 872.083 | 846.509 | 932.994 |
| Accounting value of inventories mortgaged (limited to granded loans) | 175.687 | 134.874 | 203.123 |
The "properties held for sale" classified under "Inventories (Stock)" represent the real property projects in the portfolio and under development. This item amounts to €872.08 million, down €60.91 million net from 31 December 2021. This variation results primarily from (a) the acquisition of the Fleet House (London) and Astro (Brussels) projects for a total of €36.78 million, (b) the continuation of the works and studies of the Arena Business Campus, Roseville, Bakerstreet, Lake 11 (Budapest), @Expo, UP-site (Bucharest), Lakeside (Warsaw), Am Wherharhn, Heinrichstrasse (Dusseldorf), Well'be (Lisbon), Twist (Luxembourg), City Dox (Brussels), Victor Hugo, and Com'Unity (Paris) projects, for a total of €59.37 million, (c) the sale of flats in the City Dox and Twist projects, and the sales of the Au Fil des Grands Prés office properties, reducing the stock by €6.10 million, (d) the exit of the Cloche d'Or project from stock following the equity accounting of the Cloche d'Or Development shareholding (-€135.91 million) and (e) the transfer of the Nysdam building to the "investment property" heading in the amount of €15.4 million (see Note 9). The conversion differences related to the projects in Central Europe had a downward impact on the stock of €9.43 million; finally, the balance of the net change in this item (€9.78 million) is distributed over other projects under development.
| Note 12. Current and non-current financial assets | ||
|---|---|---|
| In thousands of EUR | Other financial investments |
Trade and other receivables |
Cash and cash equivalents |
|---|---|---|---|
| MOVEMENTS IN FINANCIAL ASSETS | |||
| Non-current financial assets | |||
| Beginning balance | 56.986 | 19.605 | |
| Acquisitions | 5.152 | 241 | |
| Disposals (-) | -68 | -8.507 | |
| Reclassification (to) from other items | 30.560 | ||
| Increase (decrease) in the discounted amount | 114 | ||
| arising from the passage of time and of any change in the | |||
| discount rate | |||
| Foreign currency exchange increase (decrease) | -1 | ||
| Ending balance | 92.629 | 11.453 | 0 |
| Fair value | 92.629 | 11.453 | |
| Valuation | niveau 3 | niveau 3 | |
| Current financial assets | |||
| Beginning balance | 1.523 | 24.770 | 90.881 |
| Acquisitions | 2.836 | ||
| Disposals (-) | -1.645 | -72.056 | |
| Exits from the consolidation scope | -19.136 | -116 | |
| Reclassification (to) from other items | 67.568 | ||
| Impairments (-) | 2 6 |
||
| Foreign currency exchange increase (decrease) | -298 | -466 | |
| Ending balance | 4.385 | 71.259 | 18.243 |
| Fair value | 4.385 | 71.259 | 18.243 |
| Valuation | levels 1 & 3 | level 3 | level 3 |
"Other non-current financial assets" mainly relate to net advances to companies accounted for by the equity method. The change is explained, in particular, by the advances granted during the first half of the year (€4.69 million) as well as by the transfer to "Clients and other current debtors" of 50% of the debt on Cloche d'Or Development following the sale of 50% of this holding "Other current financial assets" include short-term deposits (€4.07 million) and debt securities (€0.31 million), the valuation of which at the 30 June 2022 stock market price resulted in a €26,000 reversal of value loss.
As at 30 June 2022, "Clients and other non-current debtors" totalled €11.45 million. This item covers the maturity in 2024 of the discounted debt on the purchaser of the NGY shareholding (€7.71 million), the discounted debt on the development of the Verheeskade II project (€2.36 million) and the proceeds receivable related to the sales of the flats in the Twist and City Dox Lot 7.1 projects (€1.38 million).
"Clients and other current debtors" increased from €24.77 million to €71.26 million as at 30 June 2022, an increase of €46.49 million. This includes:
- The part of the claim on the purchaser of the NGY shareholding to be cashed out in 2023 (€8 million);
- The balance to be paid on the sale of 50% of Cloche d'Or Development securities (€41.57 million);
- Claims on the VAT administrations (€13.43 million);
- The turnover acquired following the sales agreement signed for 5 productive activities in Lot 3 of the City Dox project (€2.50 million).
Foreign exchange, default, credit, and liquidity risks are detailed in Note 16 of the 2021 Annual Financial Report.
Fair value hierarchy levels
For each category of financial instrument, ATENOR supplies the methods applied to determine their fair value. Level 1: Prices listed on active markets
Beaulieu certificates
Level 2: (Directly or indirectly) observable data other than listed prices
Derivative instruments are, where appropriate, valued by a financial institution on the basis of market parameters.
Level 3: Non-observable market data
The fair value of "Current and non-current financial assets" (including liquid assets) is close to the market value. The fair value of unlisted financial assets available for sale is estimated at their book value, taking into account changes in the activity of the companies concerned and existing shareholder agreements. Their amount is insignificant.
The fair value of "Trade and other receivables" corresponds to their nominal value (deducting any impairment loss) and reflects the sale price of the goods and other assets sold in provisional agreements and notarial deeds.
Sensitivity analysis
Taking into account the nature of the financial assets and their short maturities, a sensitivity analysis is not necessary, as the impact of the rate variations is negligible.
Cash and Cash equivalents
| In thousands of EUR | |||
|---|---|---|---|
| 30.06.2022 | 30.06.2021 | 31.12.2021 | |
| CASH AND CASH EQUIVALENTS | |||
| Short-term deposits | 4.070 | 9.277 | 1.235 |
| Bank balances | 18.241 | 26.423 | 90.880 |
| Cash at hand | 2 | 2 | 1 |
| Total cash and cash equivalents | 22.313 | 35.702 | 92.116 |
Note 13. Current and non-current financial liabilities
| In thousands of EUR | Current | Non current | |||||||
|---|---|---|---|---|---|---|---|---|---|
| More than 5 | Total | Fair value (*) | Valuation | ||||||
| 30.06.2022 | Up to 1 year 1-5 years |
years | |||||||
| Derivatives | -140 | -140 | -140 | level 2 | |||||
| Financial liabilities | |||||||||
| Finance lease debts (IFRS 16) | 415 | 1.258 | 4.171 | 5.844 | 5.840 | level 3 | |||
| Credit institutions | 86.873 | 137.754 | 224.627 | 221.295 | level 3 | ||||
| Bond isssue | 20.000 | 269.819 | 289.819 | 281.976 levels 1 & 3 | |||||
| Other loans | 187.700 | 62.139 | 55.000 | 304.839 | 302.863 levels 1 & 3 | ||||
| Total financial liabilities according to their maturity | 294.988 | 470.970 | 59.171 | 825.129 | 811.974 | ||||
| Other financial liabilities | |||||||||
| Trade payables | 24.876 | 24.876 | 24.876 | level 3 | |||||
| Other payables | 10.477 | 22.744 | 33.221 | 33.221 | level 3 | ||||
| Other financial liabilities | 1.305 | 1.305 | 1.305 | level 3 | |||||
| Total amount of other liabilities according to their maturity | 35.353 | 24.049 | 59.402 | 59.402 | |||||
| Current | Non current | ||||||||
| Up to 1 year 1-5 years |
More than 5 | Total | Fair value | Valuation | |||||
| 31.12.2021 | years | ||||||||
| Derivatives | 184 | 184 | 184 | level 2 | |||||
| Financial liabilities | - | ||||||||
| Finance lease debts (IFRS 16) | 377 | 1.148 | 9 3 |
1.618 | 1.611 | level 3 | |||
| Credit institutions | 137.586 | 112.192 | 249.778 | 229.863 | level 3 | ||||
| Bond isssue | 20.000 | 214.786 | 75.000 | 309.786 | 314.815 levels 1 & 3 | ||||
| Other loans | 198.000 | 70.361 | 5.000 | 273.361 | 274.007 levels 1 & 3 | ||||
| Total financial liabilities according to their maturity | 355.963 | 398.487 | 80.093 | 834.543 | 820.296 | ||||
| Other financial liabilities | |||||||||
| Trade payables | 26.459 | 26.459 | 26.459 | level 3 | |||||
| Other payables | 14.609 | 18.791 | 33.400 | 33.400 | level 3 | ||||
| Other financial liabilities | 1.267 | 1.267 | 1.267 | level 3 | |||||
| Total amount of other liabilities according to their maturity | 41.068 | 20.058 | 61.126 | 61.126 |
(*) The fair value of financial instruments is determined as follows:
- If their maturity is short-term, the fair value is presumed to be similar to the amortised cost.
- For non-current fixed-rate debts, by discounting the future interest flows and capital reimbursements at a rate of 2.45%, which corresponds to the Group's weighted average financing rate.
- For listed bonds, on the basis of the closing price
The policy on indebtedness, financial risks, and interest rate risk are set out in Note 20 of the annual financial report for 2021.
Derivatives (liabilities)
ATENOR uses financial derivative instruments exclusively for the purposes of hedging. These financial instruments are measured at their fair value with variations in value charged to the P&L account, except for the financial instruments qualified as "Cash flow hedges", for which the part of the profit or the loss on the hedging instrument considered to constitute an effective hedge is booked directly through equity account under the "other items of the overall result" heading. As far as "Fair value hedges" are concerned, changes in the fair value of the derivatives defined and qualified as fair value hedges are booked in the results account as changes to the fair value of the hedged asset or liability, charged to the hedged risk.
As part of the financing of €22 million by its Polish subsidiary Haverhill Investments in February 2019, ATENOR simultaneously concluded a hedging rate contract which covers 71% of the credit. The fair value of this financial instrument qualified as a "cash flow hedge" (-€0.32 million) is directly recognised under equity.
Following the investments made in the United Kingdom, an FX Forward Swap was issued for £20 million to cover the foreign exchange risk. This coverage will be renewed semi-annually, if applicable, and the amount of income or expenses to be carried forward is recorded in the accounts.
Financial debt
| In thousands of EUR | ||||
|---|---|---|---|---|
| Current Non-current |
TOTAL | |||
| Up to 1 year | More than 1 year | |||
| MOVEMENTS ON FINANCIAL LIABILITIES | ||||
| On 31.12.2021 | 355.963 | 478.580 | 834.543 | |
| Movements of the period | ||||
| - New loans | 10.000 | 109.078 | 119.078 | |
| - Reimbursement of loans | -44.774 | -20.000 | -64.774 | |
| - Rent debts (IFRS 16) | 3 8 |
4.187 | 4.225 | |
| - Exits from the consolidation scope | -68.000 | -68.000 | ||
| - Variations from foreign currency exchange | 1 | -39 | -38 | |
| - Short-term/long-term transfer | -26.274 | 26.274 | ||
| - Other | 3 4 |
6 1 |
9 5 |
|
| On 30.06.2022 | 294.988 | 530.141 | 825.129 |
Please see the comment on page 4 of the consolidated balance and the increase in indebtedness.
For the 6-month period ending June 30, 2022, the €9.41 million net decrease in financial debt is due to:
- New borrowing during the half-year (+€119 million), namely a €55million "Green" bond issue (characteristics set out below), €10 million in corporate financing, and two loans in the amounts of €45 million and €8 million respectively for the Victor Hugo and Astro projects;
- The exit from the scope of the BGL loan for Cloche d'Or Development following the sale of 50% of the shareholding (-€68 million);
- The half-yearly repayments (-€64.77 million), including €23.55 million from CP and MTN, the matured bond loan of €20 million, and the Belfius rollover of €20 million.
During the 6-month period ending June 30, 2022, the main real estate lease agreement covered by IFRS 16 is the lease of land for the Fleet House project in England. The initial rent debt of this new contract was calculated by discounting the future payments related to the property lease at the rate of 5.10%.
The book value of the financial debts is their nominal value adjusted for the costs and commissions related to the establishment of these loans and the adjustment related to the valuation of derivative financial instruments.
Sensitivity analysis for interest rate variations
The commercial perspectives of our projects and corresponding cash flows do not lead to major interest rate risk.
Given the structure of the group's indebtedness and the fixed rates for long-term debt, sensitivity analysis thus becomes superfluous. As in previous years, such an analysis will reveal an impact of very little significance. Subject to events not known on the date of publication of this report, ATENOR intends to redeem the MTN and EMTN bonds issued at maturity.
Main characteristics of the new bond issues in S1-2022:
No.1 – 2022 - 2028
- "Green Retail Bond" issued in the context of the EMTN programme
- Amount: €55,000,000
- Gross annual interest: 4.625%
- Gross actuarial yield: 4.26%
- Issue date: 05/04/2022
- Maturity date: 05/04/2028
- Issue price: 101.875%
- Nominal minimum subscription amount: €1,000.00
- Bond listed on Euronext Brussels
- ISIN code: BE0002844257
- Coordinator: Banque Belfius
- Co-leaders: Belfius, KBC and Degroof Petercam
| FINANCIAL DEBTS on 30.06.2022 | ||
|---|---|---|
| Bonds issues | Nominal value (in EUR) | |
| Retail bond - tranche 2 at 3.50% | 05.04.2018 to 05.04.2024 | 30,000,000 |
| Retail bond - tranche 1 at 3% | 08.05.2019 to 08.05.2023 | 20,000,000 |
| Retail bond - tranche 2 at 3.50% | 08.05.2019 to 08.05.2025 | 40,000,000 |
| Retail bond - tranche 1 at 3.25% | 23.10.2020 to 23.10.2024 | 35,000,000 |
| Retail bond - tranche 2 at 3.875% | 23.10.2020 to 23.10.2026 | 65,000,000 |
| Green Retail bond - tranche 1 at 3.00% | 19.03.2021 to 19.03.2025 | 25,000,000 |
| Green Retail bond - tranche 2 at 3.50% | 19.03.2021 to 19.03.2027 | 75,000,000 |
| Green Retail bond (EMTN) - at 4.625% | 05.04.2022 to 05.04.2028 | 55,000,000 |
| Total bond issues | 345.000.000 | |
| Via credit institutions | ||
| Atenor Group Participations | 9.000.000 | |
| Atenor Long Term Growth | 6.940.000 | |
| Atenor | Corporate (BNPPF) | 10.000.000 |
| Atenor | Corporate (Belfius) | 10.000.000 |
| Projects | Le Nysdam (via Hexaten) | 13.000.000 |
| City Dox (via Immmobilière de la Petite Île) | 18.000.000 | |
| Realex (via Leaselex) | 50.000.000 | |
| Realex (via Immo Silex) | 10.000.000 | |
| Beaulieu (via Atenor) | 18.900.000 | |
| Lakeside (via Haverhill) | 18.150.000 | |
| Twist (via Atenor Luxembourg) | 7.743.700 | |
| Victor Hugo (via 186 Victo Hugo) | 45.000.000 | |
| Victor Hugo (via 186 Victo Hugo) | 8.000.000 | |
| Total financial debts via credit institutions | 224.733.700 | |
| Other loans | ||
| CP | 2022 | 88.950.000 |
| 2023 | 39.250.000 | |
| MTN | 2022 | 28.250.000 |
| 2023 | 14.500.000 | |
| 2025 | 5.000.000 | |
| 2026 | 500.000 | |
| EMTN | 2022 | 18.000.000 |
| 2023 | 30.000.000 | |
| 2024 | 8.100.000 | |
| 2025 | 10.000.000 | |
| 2026 | 2.500.000 | |
| 2027 | 5.000.000 | |
| Total other payables | 250.050.000 | |
| Leases liabilities (IFRS 16) | ||
| Atenor France | 346.589 | |
| Atenor Hungary | 151.994 | |
| Atenor Luxembourg | 774.450 | |
| Atenor Deutschland | 156.748 | |
| Atenor Romania | 234.525 | |
| Fleethouse | 4.179.744 | |
| Total leases liabilities | 5.844.050 | |
| TOTAL FINANCIAL DEBTS | 825.627.750 |
Fair value hierarchy levels
The Group measures the fair value of its financial liabilities using a fair value hierarchy. A financial instrument is classified within the fair value hierarchy based on the lowest level input that is significant to the fair value measurement.
Level 1: Prices listed on active markets
For instruments listed on an active market, such as bond issues and (E)MTNs included in "other borrowings", the fair value corresponds to the listed price on the closing date.
Level 2: (Directly or indirectly) observable data other than listed prices
Derivative instruments are, where appropriate, valued by a financial institution on the basis of market parameters.
Level 3: Non observable market data
Depending on their maturity, "Financial liabilities" are valued on a discounted cash flow basis or at amortised cost based on the effective interest rate, justified by conventions and amounts borrowed.
The fair value of trade and other payables is considered to be equal to the respective carrying amount of these instruments due to their short-term maturity.
Note 14. Stock option plans for personnel and other share-based payments
On 8 March 2022, ATENOR issued a stock option plan (SOP 2022) for the Atenor Long Term Growth (ALTG) subsidiary.
The options issued to this subsidiary benefit the members of the Executive Committee, employees, and some ATENOR service providers.
This SOP 2022 may be exercised during the following three periods: from 10 March to 31 March 2025, from 9 March to 31 March 2026, and from 8 March to 31 March 2027, after each publication of the annual results.
It may be recalled that on 29 August 2018, the Board decided to acquire 150,000 securities via the Atenor Long Term Growth SA subsidiary with a view to implementing the aforementioned new share option plan from 2019 onwards.
Note 15. Events subsequent to the closing date
As announced in the press release published on August 29, 2022 the Board of Directors has approved the appointment of Value Add Consulting SRL, represented by Mr Laurent Jacquemart, as a member of ATENOR's Executive Committee. It has appointed him as Chief Financial Officer to replace Mr Sidney D. Bens, with effect as of 5 September 2022.
No other major event is to be noted since 30 June 2022.
E. Management declaration
Stéphan SONNEVILLE s.a., CEO and Chairman of the Executive Committee and the Members of the Executive Committee, including Mr Sidney D. BENS, CFO, acting in the name and on behalf of ATENOR SA, attest that to the best of their knowledge,
- The condensed financial statements as at 30 June 2022 were prepared in accordance with IFRS standards as adopted by the European Union and provide a true and fair view of ATENOR's assets, financial situation, and profits, as well as those of the enterprises included in the consolidation2 ;
- The half-year financial report contains a true reflection of the major events and the principal transactions between related parties occurring during the first six months of the financial year and their impact on the condensed financial statements, as well as a description of the main risks and uncertainties for the remaining months of the financial year (see page 5 of the present document).;
- Continuity accounting principles are applied.
2 Affiliated companies of ATENOR as defined by Article 1.20 of French Code on companies and associations
F. External audit
Statutory auditor's report to the Board of Directors of Atenor SA on the review of the condensed consolidated interim financial information as at 30 June 2022 and for the six-month period then ended
Introduction
We have reviewed the accompanying condensed consolidated statement of financial position of ATEN0R SA as at 30 June 2022, the condensed consolidated statements of profit, comprehensive income, changes in equity and cash flows for the six-month period then ended, and notes ("the condensed consolidated interim financial information"). The board of directors is responsible for the preparation and presentation of this condensed consolidated interim financial information in accordance with IAS 34, "Interim Financial Reporting" as adopted by the European Union. Our responsibility is to express a conclusion on this condensed consolidated interim financial information based on our review.
Scope of Review
We conducted our review in accordance with the International Standard on Review Engagements 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity". A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the accompanying condensed consolidated interim financial information as at 30 June 2022 and for the six-month period then ended is not prepared, in all material respects, in accordance with IAS 34, "Interim Financial Reporting" as adopted by the European Union.
Diegem, 1 September 2022 EY Réviseurs d'Entreprises SRL Statutory auditor, represented by Carlo-Sébastien D'Addario* Partner
*Acting on behalf of a BV/SRL