Annual / Quarterly Financial Statement • Feb 22, 2022
Annual / Quarterly Financial Statement
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CONSOLIDATED FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2021
Explanation of Change In Name of Reporting Entity Or Other Means of Identification From End of Preceding Reporting Period:
Address of Registered Office of Entity: 87, rue de Richelieu in Paris (France)
Description of Nature of Entity's Operations And Principal Activities: § note1
Level of Rounding Used In Financial Statements: million euros with a digit after the comma
Country of Incorporation: France
Legal Form of Entity: §Note1
Name of Parent Entity: none
Not applicable
Date of End of Reporting Period 2013: §Note1
Description of Presentation Currency: euros
Domicile of Entity: 87, rue de Richelieu in Paris, France
Name of Ultimate Parent of Group: Not applicable
Principal Place of Business. Note 844
Name of Reporting Entity Or Other Means of Identification: §Note1
Period Covered By Financial Statements, 01/01/2020 - 31/12/2020
| 1 | FINANCIAL STATEMENTS | 3 |
|---|---|---|
| 2 | NOTES – CONSOLIDATED INCOME STATEMENT BY SEGMENT |
8 |
| 3 | OTHER INFORMATION ATTACHED TO THE CONSOLIDATED FINANCIAL STATEMENTS |
9 |
| Non-current assets 5,170.8 5,132.2 Intangible assets 7.2 332,5 330,4 o/w Goodwill 209,4 209,4 o/w Brands 105,4 105,4 o/w Other intangible assets 17,7 15,7 Property, plant and equipment 27,8 26,1 Right-of-use on tangible and intangible fixed assets 7.3 128,4 140,3 Investment properties 7.1 4,176.8 4,024.6 o/w Investment properties in operation at fair value 3,814.5 3,649.0 o/w Investment properties under development and under construction at cost 192,8 211,1 o/w Right-of use on Investment properties 169,6 164,6 Securities and investments in equity affiliates 4.5 459,4 579,6 Non-current financial assets 4.6 22,0 12,6 Deferred taxes assets 5.3 24.1 18.5 Current assets 4,188.5 3,817.8 Net inventories and work in progress 7.4 922,6 859,3 Contract assets 7.4 714,1 741,2 Trade and other receivables 7.4 858,2 828,0 Income credit 19.5 11,4 Current assets 4.6 28,3 22,0 Derivative financial instruments 8 12,0 1,1 Cash and cash equivalents 6.2 1 625,5 1 277,5 Assets held for sale 7.1 8,3 77,4 TOTAL ASSETS 9 359,4 8 950,0 Equity 3,543.6 2,716.7 Equity attributable to Altarea SCA shareholders 2,236.2 1,758.5 Share capital 6.1 310,1 264,0 Other paid-in capital 513,9 233,8 Reserves 1,200.5 1,568.5 Income associated with Altarea SCA shareholders 211,6 (307,7) Equity attributable to minority shareholders of subsidiaries 1 307,4 958,2 Reserves associated with minority shareholders of subsidiaries 1 033.4 979.1 Other equity components, Subordinated Perpetual Notes 223.5 195.1 Income associated with minority shareholders of subsidiaries 50,5 (216,0) Non-current liabilities 3,036.5 2,630.5 Non-current borrowings and financial liabilities 6.2 2,891.7 2,500.2 o/w Participating loans and advances from associates 59.3 71.3 o/w Bond issues 1,723.2 1,720.4 o/w Borrowings from lending establishments 681.7 379,4 o/w Negotiable European Medium Term Note 122.0 25.0 o/w Lease liabilities 138.2 149.4 o/w Contractual fees on investment properties 167.2 154.8 Long-term provisions 6.3 36,8 24,0 Deposits and security interests received 38,7 36,6 Deferred tax liability 5.3 69.4 69.7 Current liabilities 2,779.2 3,602.8 Current borrowings and financial liabilities 6.2 838,5 1569.8 o/w Bond issues 26,2 254.6 o/w Borrowings from lending establishments 67.4 458.9 o/w Negotiable European Commercial Paper 637.0 628.0 o/w Bank overdrafts 13,6 3,9 o/w Advances from Group shareholders and partners 75.6 199.4 o/w Lease liabilities 16,1 1,1 o/w Contractual fees on investment properties 2,6 24,0 Derivative financial instruments 8 16,7 36,3 Contract liabilities 7.4 168.1 177.3 Trade and other payables 7.4 1,740.6 1,798.4 Tax due 15.2 21,0 TOTAL LIABILITIES 9 359,4 8 950,0 |
(€ millions) | Note | 31/12/2021 | 31/12/2020 |
|---|---|---|---|---|
| (€ millions) | Note | 31/12/2021 | 31/12/2020 |
|---|---|---|---|
| Rental income | 186,7 | 184,9 | |
| Property expenses | (1,9) | (1,9) | |
| Unrecoverable rental expenses | (8,9) | (8,7) | |
| Expenses re-invoiced to tenants | 55,1 | 53,4 | |
| Rental expenses | (64,0) | (62,2) | |
| Other expenses | (1,6) | 1,2 | |
| Net charge to provisions for current assets | (11,8) | (16,1) | |
| Net rental income | 5.1 | 162,5 | 159,3 |
| Revenue | 2,796.2 | 2,837.0 | |
| Cost of sales | (2,446.5) | (2,496.4) | |
| Other income | (102,4) | (107,0) | |
| Net charge to provisions for current assets | (10,1) | (9,2) | |
| Amortisation of customer relationships | – | (0,6) | |
| Net property income | 5.1 | 237,2 | 223,8 |
| External services Own work capitalised and production held in inventory |
46,9 196,6 |
34,3 182,5 |
|
| Personnel costs | (253,6) | (225,3) | |
| Other overhead expenses | (68,1) | (71,5) | |
| Depreciation expenses on operating assets | (29,5) | (31,8) | |
| Net overhead expenses | (107,6) | (111,9) | |
| Other income and expenses | (9,8) | 0,4 | |
| Depreciation expenses | (0,2) | (1,9) | |
| Transaction costs | (14,9) | (2,3) | |
| Others | (24,9) | (3,8) | |
| Proceeds from disposal of investment assets | 8,9 | 380,3 | |
| Carrying amount of assets sold | (10,2) | (385,0) | |
| Net gain/(loss) on disposal of investment assets | (1,3) | (4,7) | |
| Change in value of investment properties | 7.1 | 39,9 | (580,7) |
| Net impairment losses on investment properties measured at cost | (4,8) | (59,8) | |
| Net impairment losses on other non-current assets | (1,2) | (0,1) | |
| Net charge to provisions for risks and contingencies | (11,5) | 1,6 | |
| Impairment of goodwill | – | (1,0) | |
| OPERATING INCOME BEFORE THE SHARE OF NET INCOME OF EQUITY-METHOD | |||
| AFFILIATES | 288,3 | (377,4) | |
| Share in earnings of equity-method affiliates | 4.5 | 19,1 | 50,2 |
| OPERATING INCOME AFTER THE SHARE OF NET INCOME OF EQUITY-METHOD | |||
| AFFILIATES | 307,4 | (327,2) | |
| Net borrowing costs Financial expenses |
5.2 | (54,6) (68,5) |
(68,8) (75,8) |
| Financial income | 13,9 | 7,0 | |
| Other financial results | 5.2 | (28,7) | (17,1) |
| Change in value and income from disposal of financial instruments | 5.2 | 5,7 | (56,5) |
| Net gain/(loss) on disposal of investments | 46,2 | 0,8 | |
| Profit before tax Corporate income tax |
5.3 | 276,1 (13,9) |
(468,8) (54,9) |
| NET INCOME | 262,1 | (523,8) | |
| o/w attributable to shareholders of Altarea SCA | 211,6 | (307,7) | |
| o/w attributable to minority interests in subsidiaries | 50,5 | (216,0) | |
| Average number of undiluted shares (a) | 18 024 260 | 17 308 818 | |
| Net Income per share attributable to shareholders of Altarea SCA (€) | 5.4 | 11,74 | (17,78) |
| Diluted average number of shares (a) | 18 424 086 | 17 539 018 | |
| Diluted net income per share attributable to shareholders of Altarea SCA (€) | 5.4 | 11,49 | (17,55) |
(a) In accordance with IAS 33, the weighted average number of shares (diluted and undiluted) is retrospectively adjusted to take into account the capital increase with preferential subscription rights that took place in December 2021.
| (€ millions) | 31/12/2021 | 31/12/2020 |
|---|---|---|
| NET INCOME | 262,1 | (523,8) |
| Actuarial differences on defined-benefit pension plans (a) | 3,2 | 0,3 |
| o/w Taxes | (0,7) | (0,2) |
| Subtotal of comprehensive income items that may not be reclassified to profit | 3,2 | 0,3 |
| OTHER COMPREHENSIVE INCOME | 3,2 | 0,3 |
| CONSOLIDATED COMPREHENSIVE INCOME | 265,3 | (523,5) |
| o/w Net comprehensive income attributable to Altarea SCA shareholders | 214,8 | (307,4) |
| o/w Net comprehensive income attributable to minority interests in subsidiaries | 50,5 | (216,0) |
(a) Actuarial differences are impacted by the inclusion of changes in interest rates and the Group's common social base.
| (€ millions) | Note | 31/12/2021 | 31/12/2020 |
|---|---|---|---|
| Cash flow from operating activities | |||
| Net income | 262,1 | (523,8) | |
| Elimination of corporate income tax expense (income) | 5.3 | 13,9 | 54.9 |
| Elimination of net interest expense (income) and dividends | 5.2 | 83.1 | 85.5 |
| Net income before tax and before net interest expense (income) | 359.2 | (383.3) | |
| Elimination of share in earnings of equity-method subsidiaries | 4.5 | (19.1) | (50.2) |
| Elimination of depreciation and impairment | 47.6 | 34.9 | |
| Elimination of value adjustments | 7.1/5.2 | (40.8) | 697.0 |
| Elimination of net gains/(losses) on disposals | (45.1) | 3,7 | |
| Estimated income and expenses associated with share-based payments | 6.1 | 23,4 | 12.5 |
| Net cash flow | 325.2 | 314.6 | |
| Tax paid | (34,7) | (13.7) | |
| Impact of change in operational working capital requirement (WCR) | 7.4 | (76.5) | 144.0 |
| CASH FLOW FROM OPERATIONS | 214.0 | 444.9 | |
| Cash flow from investment activities | |||
| Net acquisitions of assets and capitalised expenditures | 7.1 | (106,6) | (125,7) |
| Gross investments in equity affiliates | 4.5 | (59,3) | (79.9) |
| Acquisitions of consolidated companies, net of cash acquired | 4.3 | (17,7) | (6,0) |
| Other changes in Group structure | 0,2 | 2,0 | |
| Increase in loans and advances | (35.9) | (146.8) | |
| Sale of non-current assets and reimbursement of advances and down payments (1) | 12,0 | 340.1 | |
| Disposals of equity affiliates | 4.5 | 67.1 | 47.3 |
| Disposals of consolidated companies, net of cash transferred | 4.3 | 134,2 | 4.8 |
| Reduction in loans and other financial investments | 21.4 | 28,4 | |
| Net change in investments and derivative financial instruments | 5.2 | (18,2) | (72.8) |
| Dividends received | 125.3 | 34,2 | |
| Interest income on loans | 8,8 | 7,5 | |
| CASH FLOW FROM INVESTMENT ACTIVITIES | 131.3 | 33.2 | |
| Cash flow from financing activities | |||
| Capital increase (2) | 357.9 | 7.6 | |
| Subordinated Perpetual Notes (3) | 28,4 | – | |
| Share of minority interests in the capital increase of subsidiaries (4) | 211.3 | – | |
| Dividends paid to Altarea SCA shareholders | 6.1 | (91.0) | (90.0) |
| Dividends paid to minority shareholders of subsidiaries | (25.5) | (10,9) | |
| Issuance of borrowings and other financial liabilities | 6.2 | 1,564.2 | 1,827.0 |
| Repayment of borrowings and other financial liabilities | 6.2 | (1,914.8) | (1,667.5) |
| Repayment of lease liabilities | 6.2 | (17,8) | (6,3) |
| Net sales (purchases) of treasury shares | 6.1 | (31,3) | (5.9) |
| Net change in security deposits and guarantees received | 2,0 | (0,2) | |
| Interest paid on financial debts | (90.4) | (86.0) | |
| CASH FLOW FROM FINANCING ACTIVITIES | (6,9) | (32.0) | |
| CHANGE IN CASH BALANCE | 338,4 | 446.1 | |
| Cash balance at the beginning of the year | 6.2 | 1 273,6 | 827.5 |
| Cash and cash equivalents | 1 277,5 | 830.2 | |
| Bank overdrafts | (3,9) | (2,7) | |
| Cash balance at period-end | 6.2 | 1,612.0 | 1 273,6 |
(1) Proceeds on disposals included in the calculation of net cash flow are presented net of transaction costs. Likewise, disposals of property assets are presented net of transaction costs in the cash flow from investment activities.
Cash and cash equivalents 1 625,5 1 277,5 Bank overdrafts (13.6) (3,9)
(2) See Changes in consolidated equity.
(3) This is the additional subscription of Subordinated Perpetual Notes subscribed by a non-controlling shareholder of a subsidiary.
(4) This relates to the minority shareholders' subscriptions to the capital increase of subsidiary Alta Blue, which owns the Cap 3000 shopping centre via its subsidiary Aldeta, and Crédit Agricole Assurance Group's investment in several centres, via a reserved capital increase and sale of shares.
| (€ millions) | Share capital |
Other paid-in capital |
Elimination of treasury shares |
Reserves and retained earnings |
Equity attributable to Altarea SCA shareholders |
Equity attributable to minority shareholders of subsidiaries |
Equity |
|---|---|---|---|---|---|---|---|
| At 1 January 2020 | 255.2 | 311.8 | (33.1) | 1,610.6 | 2,144.4 | 1 191.1 | 3,335.5 |
| Net Income | – | – | – | (307,7) | (307,7) | (216,0) | (523,8) |
| Actuarial difference relating to pension obligations | – | – | – | 0,3 | 0,3 | (0.0) | 0,3 |
| Comprehensive income | – | – | – | (307,4) | (307,4) | (216,0) | (523,5) |
| Dividend distribution | – | (138.1) | – | (13,2) | (151.4) | (19,5) | (170.9) |
| Capital increase | 8,8 | 60.2 | – | (0.0) | 68.9 | 0.0 | 69.0 |
| Measurement of share-based payments | – | – | – | 9,1 | 9,1 | 0.0 | 9,1 |
| Elimination of treasury shares | – | – | 9,2 | (10,9) | (1,8) | – | (1,8) |
| Transactions with shareholders | 8,8 | (78.0) | 9,2 | (15.1) | (75.1) | (19,5) | (94.6) |
| Changes in ownership interests without taking or losing control of subsidiaries | – | – | – | (3,6) | (3,6) | 2,6 | (0,9) |
| Changes in ownership interests associated with taking or losing control of subsidiaries |
– | – | – | – | – | – | – |
| Others | – | – | – | 0,2 | 0,2 | (0.0) | 0,2 |
| As of 31 December 2020 | 264,0 | 233,8 | (23.9) | 1 284.7 | 1 758.5 | 958,2 | 2 716.7 |
| Net Income | – | – | – | 211,6 | 211,6 | 50,5 | 262,1 |
| Actuarial difference relating to pension obligations | – | – | – | 3,2 | 3,2 | 0.0 | 3,2 |
| Comprehensive income | – | – | – | 214,8 | 214,8 | 50,5 | 265,3 |
| Dividend distribution | – | (106.7) | – | (59.4) | (166.1) | (25.4) | (191.5) |
| Capital increase | 46,1 | 386.8 | – | 0.0 | 432.9 (a) | 38,3 (b) |
471.2 |
| Subordinated Perpetual Notes | – | – | – | – | – | 28,4 (c) |
28,4 |
| Measurement of share-based payments | – | – | – | 17,4 | 17,4 | 0.0 | 17,4 |
| Elimination of treasury shares | – | – | (9,8) | (15,9) | (25,7) | – | (25,7) |
| Transactions with shareholders | 46,1 | 280.1 | (9,8) | (57.9) | 258.5 | 41.3 | 299.8 |
| Changes in ownership interests without taking or losing control of subsidiaries | – | – | – | 2,6 | 2,6 | 257.1 (d) |
259.6 |
| Changes in ownership interests associated with taking or losing control of subsidiaries |
– | – | – | – | – | – | – |
| Others | 0.0 | – | – | 1,8 | 1,8 | 0,4 | 2,2 |
| As of 31 December 2021 | 310,1 | 513,9 | (33.8) | 1,446.0 | 2 236.2 | 1 307,4 | 3 543.6 |
(a): Capital increase linked to the FCPE and option for payment of the dividend in shares for €82.8 million; Altarea SCA capital increase related to the Reuilly transaction for an amount of €5.2 million; and capital increase of 10 December 2021 for €344.9 million.
(b): The share of minority interests in the capital increase of the subsidiary Altablue.
(c): Additional subscription of Subordinated Perpetual Notes recognised in equity attributable to a minority shareholder of a subsidiary.
(d): Impact of the acquisition of Crédit Agricole Assurance in the capital of several retail parks, which resulted in an increase in the share of minority interests of €258.5 million, including the capital increase reserved to minority shareholders for €172.7 million.
The notes constitute an integral part of the consolidated financial statements.
| 31/12/2021 | 31/12/2020 | ||||||
|---|---|---|---|---|---|---|---|
| (€ millions) | Financial resources funds from operations (FFO) |
Changes in value. estimated expenses and transaction costs |
Total | Financial resources funds from operations (FFO) |
Changes in value. estimated expenses and transaction costs |
Total | |
| Rental income | 186,7 | – | 186,7 | 184,9 | – | 184,9 | |
| Other expenses | (24,2) | – | (24,2) | (25,6) | – | (25,6) | |
| Net rental income | 162,5 | – | 162,5 | 159,3 | – | 159,3 | |
| External services | 23,8 | – | 23,8 | 17,9 | – | 17,9 | |
| Own work capitalised and production held in inventory | 8,6 | – | 8,6 | 5,6 | – | 5,6 | |
| Operating expenses | (45.6) | (6,7) | (52.4) | (38.0) | (5,1) | (43.1) | |
| Net overhead expenses | (13,2) | (6,7) | (20.0) | (14,5) | (5,1) | (19,6) | |
| Share of equity-method affiliates | 3,8 | (3,0) | 0,8 | 3,4 | (15.8) | (12,4) | |
| Net allowances for depreciation and impairment | – | (12,8) | (12,8) | – | (4,0) | (4,0) | |
| Income/loss on sale of assets | (1,0) | (1,2) | (2,2) | 0,1 | (4,6) | (4,6) | |
| Income/loss in the value of investment property | – | 33,1 | 33,1 | – | (642,1) | (642,1) | |
| Transaction costs | – | (3,0) | (3,0) | – | (1,6) | (1,6) | |
| OPERATING INCOME - RETAIL | 152,1 | 6,4 | 158,4 | 148.2 | (673.3) | (525,1) | |
| Revenue | 2 484,7 | – | 2 484,7 | 2 406,9 | – | 2 406,9 | |
| Cost of sales and other expenses Net property income |
(2 280,7) 204,0 |
– – |
(2 280,7) 204,0 |
(2,204.5) 202.3 |
(0,6) (0,6) |
(2,205.1) 201,7 |
|
| External services | 13,3 | – | 13,3 | 10,1 | – | 10,1 | |
| Production held in inventory | 177,7 | – | 177,7 | 163,0 | – | 163,0 | |
| Operating expenses | (227.3) | (20,9) | (248.1) | (209.1) | (12,6) | (221.7) | |
| Net overhead expenses | (36.3) | (20,9) | (57.2) | (36.1) | (12,6) | (48.6) | |
| Share of equity-method affiliates | 12,0 | (0,6) | 11,4 | 10,8 | (2,5) | 8,3 | |
| Net allowances for depreciation and impairment | – | (20,5) | (20,5) | – | (19,0) | (19,0) | |
| Transaction costs | – | – | – | – | (0.0) | (0.0) | |
| OPERATING INCOME - RESIDENTIAL | 179.6 | (42.0) | 137,7 | 177.0 | (34,7) | 142,3 | |
| Revenue | 305,2 | – | 305,2 | 416,5 | – | 416,5 | |
| Cost of sales and other expenses | (271,0) | – | (271,0) | (394,5) | – | (394,5) | |
| Net property income | 34,2 | – | 34,2 | 22,0 | – | 22,0 | |
| External services | 9,8 | – | 9,8 | 6,2 | – | 6,2 | |
| Production held in inventory | 10,3 | – | 10,3 | 13,9 | – | 13,9 | |
| Operating expenses | (26.2) | (5,2) | (31,3) | (29.4) | (3,0) | (32.4) | |
| Net overhead expenses | (6,1) | (5,2) | (11.2) | (9,3) | (3,0) | (12.3) | |
| Share of equity-method affiliates | 46,9 | (1,5) | 45.3 | 37.6 | 17,0 | 54.6 | |
| Net allowances for depreciation and impairment | – | (1,0) | (1,0) | – | (1,4) | (1,4) | |
| Income/loss in the value of investment property | – | 2,0 | 2,0 | – | 1,7 | 1,7 | |
| Transaction costs | – | – | – | – | – | – | |
| OPERATING INCOME - BUSINESS PROPERTY | 75,0 | (5.7) | 69,3 | 50,3 | 14.3 | 64,6 | |
| Others (Corporate) OPERATING INCOME |
(1,8) 404.9 |
(17.9) (59,2) |
(19,7) 345,8 |
(4,0) 371.6 |
(4.3) (698.0) |
(8,3) (326,4) |
|
| Net borrowing costs | (49,2) | (5,4) | (54,6) | (50,6) | (18,2) | (68,8) | |
| Other financial results | (20,1) | (8,6) | (28,7) | (7,7) | (9,5) | (17,1) | |
| Change in value and income from disposal of financial instruments | – | 5,7 | 5,7 | – | (56,5) | (56,5) | |
| Net gain/(loss) on disposal of investments | – | 7,9 | 7,9 | – | (0.0) | (0.0) | |
| PROFIT BEFORE TAX | 335,7 | (59,6) | 276,1 | 313,3 | (782,2) | (468,8) | |
| Corporate income tax | (20,1) | 6,2 | (13,9) | (26,6) | (28,4) | (54,9) | |
| NET INCOME | 315,6 | (53,4) | 262,1 | 286,8 | (810,5) | (523,8) | |
| Non-controlling interests | (51,2) | 0,7 | (50,5) | (56,5) | 272,5 | 216,0 | |
| NET INCOME. GROUP SHARE | 264,4 | (52,7) | 211,6 | 230,3 | (538,1) | (307,7) | |
| Diluted average number of shares (a) | 18 424 086 | 18 424 086 | 18 424 086 | 17 539 018 | 17 539 018 | 17 539 018 | |
| NET INCOME PER SHARE (€/SHARE) GROUP SHARE | 14,35 | (2,86) | 11,49 | 13,13 | (30,68) | (17,55) |
(a) In accordance with IAS 33, the weighted average number of shares (diluted and undiluted) is retrospectively adjusted to take into account the capital increase with preferential subscription rights that took place in December 2021.
| Note 1 | Company information 10 | |
|---|---|---|
| Note 2 | Accounting principles and methods 10 | |
| 2.1 | Accounting standards applied by the Company 10 | |
| 2.2 | Main estimations and judgements 11 | |
| 2.3 | Other principles for presenting the financial statements 12 | |
| 2.4 Note 3 |
Accounting principles and methods of the Company12 Information on operating segments 24 |
|
| 3.1 | Balance sheet items by operating segment24 | |
| 3.2 | Consolidated income statement by operating segment 24 | |
| 3.3 | Reconciliation of the statement of consolidated comprehensive income and of the consolidated income statement by segment25 |
|
| 3.4 | Revenue by geographical region and operating segment 26 | |
| Note 4 | Major events and changes in the scope of consolidation 27 | |
| 4.1 | Major events 27 | |
| 4.2 | Consolidation scope29 | |
| 4.3 | Changes in consolidation scope31 | |
| 4.4 | Business combinations 31 | |
| 4.5 | Securities and investments in equity affiliates 32 | |
| 4.6 | Current and non-current financial assets33 | |
| Note 5 | Net income 34 | |
| 5.1 | Operating income 34 | |
| 5.2 | Cost of net financial debt and other financial items 34 | |
| 5.3 | Corporate income tax35 | |
| 5.4 | Earnings per share36 | |
| Note 6 | Liabilities 37 | |
| 6.1 | Equity37 | |
| 6.2 | Net financial debt and guarantees39 | |
| 6.3 | Provisions 40 | |
| Note 7 | Assets and impairment tests 42 | |
| 7.1 | Investment properties42 | |
| 7.2 | Goodwill and other intangible assets44 | |
| 7.3 | Right-of-use on tangible and intangible fixed assets 44 | |
| 7.4 | Operational working capital requirement 45 | |
| Note 8 | Financial risk management 48 | |
| 8.1 | Carrying amount of financial instruments by category 48 | |
| 8.2 | Interest rate risk 49 | |
| 8.3 | Liquidity risk 51 | |
| Note 9 | Related party transactions 52 | |
| Note 10 | Group commitments and contingent liabilities 54 | |
| 10.1 | Off-balance sheet commitments54 | |
| 10.2 | Contingent liabilities 56 | |
| Note 11 | Events after the closing date 56 | |
| Note 12 | Statutory Auditors' fees 57 | |
Altarea is a Société en commandite par actions (a French partnership limited by shares), the shares of which are traded on the Euronext Paris regulated market, (Compartment A). The registered office is located at 87 rue de Richelieu in Paris (France).
Altarea chose the SIIC corporate form (Société d'Investissement Immobilier Cotée) as of 1 January 2005.
As both a developer and investor, the Group is present in the three main real estate markets (Retail, Residential and Business property), making it the leader in major mixed-use urban renewal projects in France. The Group has the required expertise in each sector to design, develop, market, manage and exploit made-to-measure property products.
Altarea controls the company Altareit, whose shares are admitted to trading on the regulated market Euronext Paris, Compartment B.
Altarea presents its financial statements and accompanying notes in millions of euros, to one decimal point.
The consolidated financial statements for the year ended 31 December 2021 were approved by the Management on 22 February 2022 having been examined by the Audit Committee and the Supervisory Board.
The accounting principles used in the preparation of the consolidated financial statements for the year are compliant with the IASB's IFRS standards and interpretations as adopted by the European Union as at 31 December 2021 and available on the following website:
http://ec.europa.eu/internal\_market/accounting/ias\_fr.htm#a dopted-commission.
The accounting principles adopted on 31 December 2021 are the same as those used for the consolidated financial statements at 31 December 2020, with the exception of changes to the standards and interpretations adopted by the European Union applicable at 1 January 2021.
The information relating to the financial year ended 31 December 2020, presented in the Universal Registration Document filed with the AMF on 19 March 2021 under number D.21-0158 is incorporated by reference.
Accounting standards, interpretations and amendments applicable as from the financial year beginning on 1 January 2021:
These amendments have no impact for the Group.
the IFRIC recommends the straight-line allocation of benefits over the entire period preceding the retirement age up to the moment the cap is reached, i.e. starting at the date at which each year of service counts toward the accumulation benefits (previously the allocation was made on a straight-line basis over the employee's entire period of employment, i.e. from the date of hiring to the date of retirement). The accounting methods for actuarial gains and losses and past service costs remain unchanged.
This decision has no material impact on the Group's financial statements.
Accounting standards and interpretations adopted as early as at 31 December 2021, whose application is mandatory for periods starting on 1 January 2022 or later:
Accounting standards and interpretations published and mandatory after 31 December 2021:
Other essential standards and interpretations adopted by the IASB approved in 2021 or not yet approved by the European Union:
Management reviews its estimates and assumptions on a regular basis using its past experience and various other factors deemed reasonable in the circumstances. These estimates represent the basis for its assessment of the carrying amount of income or the classification of expense items and assets and liabilities. They have an impact on the amount of income and expense items and on the carrying amount of assets and liabilities. It is conceivable that the actual amounts may subsequently differ from the estimates adopted.
The accounting estimates for the financial statements at 31 December 2021 were made in the context of the COVID-19 health crisis. The Group has taken into account reliable information available to it at the date of preparation of the consolidated financial statements regarding the impact of this crisis.
The main items that require estimates at the closing date based on assumptions about the future, and for which there is significant risk of a material change in value from that recorded on the balance sheet, concern the following:
• Measurement of goodwill and brands (please see note 2.4.7 "Monitoring the value of non-current assets (excluding financial assets and investment property) and losses of value" and 7.2 "Intangible assets and goodwill").
• Measurement of investment properties (see Notes 2.4.5 "Investment properties" and 7.1 "Investment properties"):
The methodologies used by appraisers are identical to those used for the year 2020, with the inclusion of the following clauses on the current context:
"The pandemic and the measures taken to combat COVID-19 continue to affect economies and property markets around the world. However, at the valuation date, some property markets have reopened and transaction volumes and other relevant activities are returning to levels where there is a sufficiently market activity on which to base valuations. As a result, and for the avoidance of doubt, our valuation is not signalled as subject to a "material valuation uncertainty" as defined by VPS 3 and VPGA 10 of the RICS Valuation – Global Standards. This explanatory note has been included to ensure transparency and to provide further information on the market environment in which the value opinion was prepared. Given the rapid changes that market conditions may undergo in response to changes in the management or future spread of COVID-19, we stress the importance of the valuation date.
Given the unknowns on the future impact that COVID-19 could have on the real estate market, as well as on the operational practices of investors, users and operators, and on temporary or permanent changes in behaviour, we recommend that you regularly update the appraisals contained in this report. In this context, it is important to keep in mind that the definition of Market Value requires that the buyer and the seller act "knowledgeably, prudently and without compulsion".
Cushman & Wakefield (C&W):
"The coronavirus (COVID-19) epidemic, declared a "Global pandemic" by the World Health Organisation on 11 March 2020, continues to affect economies and real estate markets worldwide. However, as of the valuation date, the real estate markets are back for the most part, with sufficient transaction volumes and market data on which to base our value opinion. Therefore - and for the avoidance of doubt - our valuation is not presented as being subject to "significant valuation uncertainty" as defined by VPS 3 and VPGA 10 of the RICS Global Valuation Standards."
In accordance with the provisions of IFRS 5, the Group determines whether the criteria used to determine whether an asset or a group of assets should be classified as held for sale or if an operation is to be discontinued are met (see Note 2.4.6 "Non-current assets held for sale and discontinued operations" and 7.1 "Investment properties").
Given the limited exposure of the Group to the consequences of climate change in short term, they have no significant impact on the financial statements.
Balance sheet balances and income and expenses arising from intragroup transactions are eliminated when the consolidated financial statements are prepared.
In accordance with IAS 1, the Company presents its assets and liabilities by distinguishing between current and noncurrent items.
Assets which must be realised, consumed or disposed of within the scope of the normal operating cycle or within 12 months following closure, are classed as "current assets", as well as the assets held with a view to disposal and cash or cash equivalents. All other assets are classified as "noncurrent assets".
Liabilities which have to be paid within the scope of the normal operating cycle or within 12 months following closure are classified as "current liabilities", as well as the share of provisions arising from the normal operating cycle of the activity concerned due in less than one year.
Deferred taxes are always shown as non-current assets or liabilities.
For consolidation, the following standards apply:
IFRS 10 defines control as follows: "An investor controls an investee when it is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee". The Company has power over an investee when it has existing substantive rights that give it the current ability to direct the relevant activities, defined as activities that significantly affect the investee's returns.
The assessment of control as per IFRS 10 requiring significant judgement, the Company has developed a framework for analysing the governance of the entities related to the Company, particularly when there are partnership situations governed by broad contractual arrangements, and including, when appropriate, the shareholder structure, articles of association, shareholder pacts, commitments to buy and to sell, the regulatory governance framework, etc. It also takes account of events and circumstances associated to each entity, in assessing the ability of the Company to lead the relevants activities of this entities.
In this regard, within the limit of the protective rights granted to the JV partners:
In accordance with IFRS 10, ad hoc entities are consolidated when, in substance, the relation between the Company and the entity is such that the Company is considered to exercise control over the latter.
Controlled subsidiaries are fully consolidated. All intra-group balances and transactions as well as income and expense from internal transactions and dividends are eliminated.
Any modification in the Company's interest in a subsidiary not resulting in a loss of control is recognised in equity. If the Company loses the control over a subsidiary, the assets and liabilities and equity of this former subsidiary are derecognised. Any gain or loss resulting from this loss of control is recognised in profit or loss. Any Interest retained in the former subsidiary is recognised at fair value on the date of loss of control according to the recognition method required under IFRS 11, IAS 28 or IFRS 9.
According to IFRS 11, companies are subject to joint control when important decisions about the relevant activities require the unanimous consent of the parties sharing control.
Joint control may be exercised through joint operation or a joint venture. According to IFRS 11, the joint operation is distinguished by the existence of directly held rights to certain assets and direct obligations for certain liabilities of the entity, whereas the joint venture confers a right to the entity's net assets. For joint operations, the Company records, in its accounts, the assets, liabilities, income and expenses relating to its interests in the joint operation. For joint ventures, the Company's interest in the entity's net assets is recognised according to the equity method described in IAS 28.
Investments in joint operations or joint ventures are presented in accordance with IFRS 12.
In accordance with IAS 28, the equity method also applies to all associates in which the Company exercises a significant influence without possessing control, which is considered to exist when the percentage of voting rights held is greater than or equal to 20%. Each investment is analised, regardless of the percentage of interest held, taking into account the facts and circumstances in order to determine if the Company has a significant influence, including, when appropriate, articles of association, shareholder pacts, commitments to buy and to sell, and other relevant matters.
According to the equity method, the Company's interest in the associate is initially recognised at the acquisition cost of its proportionate share of the investee's net assets, which is then increased or decreased to reflect changes subsequent to the acquisition. Goodwill arising on an associate, if unimpaired, is included in the carrying amount of the investment. The Group's proportionate share of the entity's profit or loss for the period is shown under the "Share in earnings of equity-method affiliates" line item in the income statement. These investments are presented in the balance sheet under "Securities and investments in equity-method affiliates and non-consolidated interests" with the corresponding investment-related receivables.
The financial statements of associates are prepared for the same accounting period as those for the parent company. If necessary, corrections are made to achieve consistency with the Group's accounting policies.
Investments in associates are presented in accordance with IFRS 12.
Business combinations are accounted for in accordance with the acquisition method of IFRS 3 as amended: upon initial consolidation of an entity of which the Group has acquired control, the assets and liabilities as well as identifiable contingent liabilities are recognised at their fair value at the acquisition date. Intangible assets are specifically identified whenever they are separable from the acquired entity or result from legal or contractual rights. Therefore, when control of an entity is acquired, the difference between the acquisition cost and the acquirer's proportionate interest in the fair value of the entity's identifiable assets, liabilities and contingent liabilities at the acquisition date is classified as goodwill representing future economic benefits resulting from assets that are not individually identified and separately recognised. The acquisition cost is the amount of the consideration transferred including, where applicable, any price supplements at their fair value. Costs directly related to the acquisition are recorded as an expense for the period they were incurred.
Goodwill :
The standard allows a period of 12 months from the acquisition date for final measurement of the acquisition; any adjustments and measurements made must reflect facts and circumstances that existed as of the acquisition date. As such, after the measurement period, any contingent consideration is recognised in net income for the year unless it is in the form of an equity instrument.
Acquisitions or disposals of securities in an entity that remains controlled before and after these transactions are now considered as transactions between shareholders recognised directly in equity: they have no effect on either goodwill or income. In the event of loss of control, the residual interest is measured at fair value and the gain or loss on disposal is recognised in the income statement.
On an exceptional basis, acquisitions of isolated assets carried out through the purchase of shares in a company, the sole purpose of which is to hold assets are recognised in accordance with IAS 40 – Investment Property, or IAS 2 – Inventories.
The Group's intangible assets consist essentially of software, brands and customer relationships.
In accordance with IAS 38 :
The Cogedim, Pitch Promotion, Histoire & Patrimoine and Severini brands, which have an indefinite useful life, are thus not amortised.
• customer relationship assets, which result from the identification of intangible assets acquired from property developers, are subject to amortization at the rate at which the acquired order backlog is filled or, for the portion relating to acquired purchase options or those that can be amortised on a straight-line basis, at the rate at which development programmes are launched. Other customer relationships (customer relationships on
regular contracts, contractual relationships) can also be identified during business combinations and their value and estimated life are analised on a case-by-case basis.
Property, plant and equipment correspond primarily to general plant, transport equipment, office equipment and IT equipment. In accordance with IAS 16, these items are recognised at cost and depreciated over their useful life, estimated to be between 5 and 10 years. No other significant component of these assets has been identified.
According to IAS 40, investment properties are held to earn rentals or for capital appreciation or both.
The investment properties held by the Group are primarily shopping centres and, to a lesser extent, offices.
The Group's investment properties portfolio consists of properties in operation and properties under development or construction on a proprietary basis.
In accordance with IAS 40, the Group has opted for the fair value model. On that basis, investment properties are measured at fair value in accordance with IFRS 13 – "Fair value measurement" whenever this can be reliably determined. Otherwise, they are recorded at cost and are tested for impairment at least once per year and where evidence of impairment exists.
The fair value of investment properties used by Management is based on the facts and circumstances taking into account their purpose. With this objective, Management uses external appraisals giving values inclusive of duties less the amount of duties corresponding to transfer taxes and expenses. These duties have been estimated at 6.9% in France (except in the Paris region (Île-de-France) where they are set at 7.5%), at 5.5% in Italy and 3.0% in Spain.
Since 30 June 2015, external measurement of Altarea Group assets is assigned to Cushman & Wakefield, CBRE (in France, Italy and Spain) and Jones Lang Lasalle (in France).
All sites are visited by the appraisers first when assets enter the portfolio and subsequently every few years in rotation or when a specific event affecting an asset requires it.
The appraisers use two methods:
Rental income takes into account:
The valuation of investment properties at fair value is in line with the COB/AMF "Barthès de Ruyter working group" and complies fully with the instructions of the Appraisal Charter of Real Estate Valuation (Charte de l'Expertise en Évaluation Immobilière) updated in 2017. In addition, appraisers refer to the RICS Appraisal and Valuation Standards published by the Royal Institute of Chartered Surveyors Red Book.
Investment properties in operation are systematically measured at fair value.
At 31 December 2021, an external appraisal was performed on all assets in operation.
Each time an exchange value exists for one of the Group's buildings, set in connection with a potential transaction between knowledgeable and willing parties in an arm's length transaction, the Company will use its own judgement to choose between this value and that of the appraiser.
Investment properties under construction (IPUC) have been included within the scope of IAS 40. They are measured at fair value in accordance with the IFRS 13 guide when the criteria predefined by the Company are met.
The Company believes that a property under construction can be reliably measured at fair value if most of the uncertainties affecting the determination of fair value have been lifted or if the project completion date is in the near future.
All three of the following conditions must be met to ensure a reliable estimate of the fair value of a property under construction:
Accordingly, investment properties under development and construction are measured either at cost or at fair value:
The fair value of properties under construction measured at fair value is determined on the basis of independent appraisals. The appraiser values the asset as if it were fully complete, taking account of market conditions at the date of valuation and the specific characteristics of the property. Expenses not yet incurred at the account closing date are deducted from this value.
The difference between the fair value of investment properties measured at fair value from one period to the next is recognised in the income statement under the heading "Change in value of investment properties".
In addition to the acquisition price of the land, the costs incurred for the development and construction of properties are capitalized from the start of the programme, as of the development phase (prospecting, preparation: replying to tenders and pre-letting prior to the signing of preliminary property sales agreements; administrative phase: obtaining authorizations, if necessary with the signing of preliminary property purchase agreements), once there is reasonable assurance that administrative authorizations will be obtained.
These investments concern expenses that can be capitalized, including pre-letting fees, fees within the Group, early termination fees, financial vacancy rate, and interest expenses (under IAS 23 - note that a delay in the start of construction or when the construction period is unusually long, management assesses on a case-by-case basis the validity of temporarily stopping the capitalization of interest expenses or internal fees incurred).
For the investment properties recorded at cost, an impairment test is carried out at least once a year or as soon as there are signs of impairment.
Their projected value is determined on the basis of internal five-year business plans that are reviewed by management at regular intervals. The methods used are rental income capitalization or discounted cash flow.
The recoverable amount of these assets, which are still recognised at cost, is assessed by comparison with the cost price on completion and with the calculate value of expected future cash flows for the Company. If the recoverable amount is lower than the cost price on completion, an impairment loss in the form of a provision for impairment is recognised in the income statement under "Impairment losses on investment properties measured at cost" and in the consolidated income statement by segment under "Income/loss on the value of investment property".
In accordance with IFRS 5, a non-current asset is classified as "held for sale" if its carrying amount is to be recovered primarily through a sale transaction rather than through ongoing use.
This is the case if the asset is available for immediate sale in its current state, subject only to the usual and customary conditions for the sale of such an asset, and if its sale is highly probable.
Indications of a high probability of sale include the existence of a plan by Group management to sell the asset and an active programme to find a buyer and close a sale within the following 12 months. The management assesses the situations. When at the closing date there is a preliminary sales agreement or a firm commitment, the property is systematically included in assets held for sale.
The asset is measured at the lower of their net carrying amount and their fair value. The agreed amount is reduced by the costs of disposal.
For an operation to be considered discontinued, the Company determines, according to the facts and circumstances, whether or not there exists a single and coordinated plan to dispose of a major line of business or geographical area of operations.
In accordance with IAS 36, depreciable property, plant and equipment and amortizable intangible assets are tested for impairment whenever an internal or external indication of impairment is detected.
Goodwill and other intangible assets with an indeterminate life (such as brands) are tested for impairment at least once a year or more frequently if internal or external events or circumstances indicate that their value may have declined.
Goodwill impairment testing is performed at the level of cashgenerating units (CGUs) or, where applicable, groups of CGUs. A CGU is the smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups of assets.
To perform this test, the net carrying amount of assets directly related to or assignable to the CGUs or groups of CGUs, including intangible assets and goodwill, is compared with the recoverable amount of these same CGUs or groups of CGUs., defined as the higher of the fair value (the sale price net of costs likely to be incurred to make the sale) and their value in use.
The value in use of the CGU or the grouping of several CGUs is determined using a multi-criteria method (which uses the higher of value in use and fair value) which is mainly based on the discounted cash flow method (DCF) supported by stock-market comparison and transaction multiple methods.
The basic principles of the DCF method are:
The multiples approach via market comparables is based on determining a sample of comparable listed companies, for which a multiple is calculated and reapplied to those aggregates considered relevant.
The multiples approach via comparable transactions is based on selecting a panel of transactions in comparable companies and reapplying these to the aggregates considered relevant.
An impairment loss is recognised, if applicable, if the net carrying amount of the assets directly related to or attributable to the CGUs or groups of CGUs is higher than the recoverable amount of the CGU or group of CGUs, and is written off in priority against goodwill (irreversible loss), then against other intangible assets and property, plant and
equipment on a pro rata basis for their carrying amount (reversible loss).
Brands are tested individually. Their recoverable amount is determined using the royalty method. An impairment loss is recognised, if applicable, if the net book value of the brand is greater than its recoverable amount (reversible).
Sensitivity tables are created for all impairment tests carried out.
Inventories relate to:
In accordance with the clarification of IAS 23 (in 2019) for the financial year, the interest expenses which can be allocated to programmes are no longer incorporated into inventories connected with off-plan sales (VEFA) transactions or with Property Development Contract (PDC) transactions. These inventories are in a position to be sold quickly and therefore no time is necessary for its development; the stored asset is therefore in saleable condition. Allocated interest expenses are recognised directly as expenses.
Inventories are carried at cost price, less the portion of the cost price recognised on a percentage-of-completion basis for off-plan sales or property development contract transactions. The cost price includes:
Generally speaking, whenever the net realizable value of inventories and work in progress is less than the cost price, impairment losses are recognised.
Further to the application of IFRS 15, the Group records a contract asset or liability in the statement of financial position in the context of the recording of contracts in the accounts on the percentage-of-completion method. The asset or liability corresponds to the amount generated by the ordinary activities based on off-plan sales or property development contracts, aggregated to date, for which the obligation to provide a service is fulfilled on a progressive basis, net of any client payments received to date. These are to a certain extent receivables not yet due, corresponding to any advances between collected calls for funds and the actual percentage of completion at the closing date. Within the statement of the financial position, the service is as follows:
The Group has elected not to apply the hedge accounting proposed in IFRS 9.
Application principles for IAS 32, IFRS 9 and IFRS 7 are as follows:
At each acquisition of equity securities, a similar analysis will be carried out to determine the Group's management intention.
• Deposits and securities paid concern deposits paid on projects. They are the offsetting amount of security deposits paid into escrow accounts by shopping centre
tenants (deposits and securities not discounted) and/or, guarantee deposits paid for buildings occupied by the Group.
Financial assets and liabilities are initially recognised at the fair value of the price paid, including acquisition-related costs. After initial recognition, such assets and liabilities are recognised at fair value, estimated from observable and unobservable inputs availables.
For financial assets and liabilities such as OTC derivatives, swaps, caps, etc. that are traded on active markets (market composed of numerous transactions, continuously displayed and traded prices), fair value is estimated by an actuary using commonly accepted models and in compliance with guidance from IFRS 13 – "Fair value measurement." A mathematical model is used to bring together calculation methods based on recognised financial theories. This takes into account the measurement of credit risk (or risk of default) of Altarea visà-vis its bank counterparties and the risk of its counterparties vis-à-vis Altarea (Credit Value Adjustment/Debit Value Adjustment). The Group applies the default probability calculation method used by the secondary market (according to estimated bond spreads of its counterparties).
The financial liabilities coming from a business combination are valued at fair value at the end of each period, based on the best estimate of the amount payable, discounted at market rates.
The realizable value of financial instruments may differ from the fair value calculated at the closing date of each financial year.
Equity represents the residual value of assets, after liabilities have been deducted.
Issuance costs for equity securities including merger-related costs are deducted from the proceeds of the issue.
An instrument is an equity instrument if the instrument includes no contractual obligation to deliver cash or another financial asset, or to exchange assets or liabilities with another entity under conditions unfavourable to the issuer. On that basis, the Subordinated Perpetual Notes (TSDI) issued by Altarea SCA are equity instruments.
Own equity instruments that have been bought back (treasury shares) are deducted from equity. No gain or loss is recognised in income when own equity instruments of the Company are purchased, sold, issued or cancelled.
Share-based payments are transactions based on the value of the securities of the issuing company: stock options, free share allocation rights and company savings plans (PEE).
These rights may be settled in equity instruments or cash: in the Group, all plans concerning Altarea shares must be settled in equity instruments.
In accordance with the provisions of IFRS 2, share-based payments to corporate officers or employees of Altarea (in compensation for their roles as corporate officers or employees of Altarea) or Group companies are accounted for in the financial statements as follows: the fair value of the equity instrument awarded is recognised in the income statement as a personnel cost, with a corresponding increase in equity if the plan is to be settled in equity instruments, or in a liability if the plan is to be settled in cash.
This personnel cost representing the benefit granted (corresponding to the fair value of the services rendered by the employees in their role as employees) is valued by an actuary at the award date using the binomial Cox-Ross-Rubinstein mathematical model and the Monte Carlo method calculated on the basis of a turnover determined over the last three years. This model is adapted to suit plans that provide for a vesting period and a lock-up period. The expense is spread over the vesting period. Share grant plans and employee investment plans are measured on the basis of market value.
Basic earnings per share is calculated by dividing net income (Group share) by the weighted average number of ordinary shares in issue during the period.
Diluted earnings per share is calculated by dividing net income (Group share) by the weighted average number of ordinary shares in issue adjusted for the dilutive effects of the options during the period.
The dilutive effect is calculated according to the "share buyback" method. Under this method, the funds received from the exercise of options are assumed to be applied first to repurchasing own shares at the market price. The market price is taken to be the volume-weighted average of average monthly prices of Altarea shares. The theoretical number of shares repurchased at this market price is subtracted from the total number of shares produced by the exercise of options. The number calculated using this method is then added to the average number of shares in issue to produce the denominator.
Potential ordinary shares shall be treated as dilutive if the conversion in ordinary share implies a reduction in the result per share.
In accordance with IAS 19 and amendments adopted by the European Union in June 2012, employee benefits are recognised under "personnel costs" in the income statement, with the exception of liability (or asset) revaluations recognised directly in equity and recorded in "Other comprehensive income."
Benefits payable at retirement are paid to employees at the time of retirement based on length of service (capped according to the scales defined in the agreements applied by the Group) and their salary at retirement age. These benefits are part of the defined benefits plan, a plan to which the employer is formally or implicitly committed in an amount or a level of benefits and therefore bears the risk in the medium or long term.
A provision is recorded in the liabilities to cover all these pension commitments. It is regularly valued by independent actuaries according to the projected credit unit method and represents the probable present value of the vested rights taking into account salary increases until retirement, collective and company agreements, the probability of retirement and the probability of survival.
The formula for the past service obligation can be broken down as follows:
Past service cost = (benefit rights acquired by the employee) x (probability that the entity will pay the benefits) x (discounting to present value) x (payroll tax coefficient) x (length of service to date/length of service at retirement).
The provision is recognised and spread over the last few years of service of the employee until they reach the cap, taking into account any intermediate levels that apply.
The main assumptions used for estimating the pension obligation are as follows:
Actuarial gains and losses and valuation adjustments are recorded directly in equity under "other comprehensive income."
The amount of the obligation determined using this method is then reduced by the value of any assets held to cover it (not applicable in this case).
These benefits are offered under defined-contribution pension plans. As such, the Group has no obligation except to pay its share of contributions. The expense corresponding to contributions paid is recognised in the income statement as incurred.
Where applicable, payments for termination of an employment contract are provisioned on the basis of the collective agreement.
Short-term benefits include in particular an incentive agreement for employees to share in the profit recorded by their economic and social unit, signed by the service companies of the Group that are members of the economic and social unit, and the works council. Benefits also include an employee profit-sharing plan applicable to the profit of the economic and social unit as required under French common law.
Short-term employee benefits including those arising from these profit-sharing plans are expensed as incurred.
In accordance with IAS 37, a provision is recognised when an obligation to a third party will result in an likely outflow of resources without any equivalent benefits being received in consideration, and when the amount required to settle the obligation can be reliably estimated. The provision is maintained as long as the timing and amount of the outflow of resources are not known with precision.
In general, these provisions are not linked to the Group's normal operating cycle. Provisions are discounted when appropriate using a pre-tax rate of return that reflects the risks specific to the liability.
Non-current provisions consist mainly of provisions arising from litigation between the Group and third parties or from rent guarantees.
Contingent liabilities correspond to :
These contingent liabilities are not recognised on the balance sheet. A disclosure is made in the notes unless the amounts at stake can reasonably be expected to be small.
Following its decision to adopt the SIIC tax status, the Group is subject to a specific tax regime:
Income taxes are recognised in accordance with IAS 12.
From the time that SIIC tax status was adopted, deferred taxes are calculated for companies without such status and on the taxable profits of companies in the SIIC sector. They are recognised on all timing differences between the carrying amounts of assets and liabilities and their values for tax purposes, and on tax loss carry forwards, using the liability method.
Deferred tax assets and liabilities are measured using the liability method at the tax rates expected to apply when the asset will be realized or the liability settled, on the basis of known tax rates at the closing date.
Since 31 December 2016, the Group has applied the gradual and programmed reduction in the rate in its consolidated financial statements in accordance with the Finance Act in force.
Deferred tax assets are reassessed at each closing date and are recognised where it is likely that future taxable profits will allow their recovery based on a business plan for tax purposes prepared by management for a reasonable period.
Deferred taxes in the balance sheet are presented in a net position at the level of each tax consolidation group, as either an asset or a liability in the consolidated balance sheet.
Taxes on items recognised directly in equity are also recognised in equity, not in the income statement.
Net rental income comprises: rental income and other net rental income less land expenses, non-recovered service charges, other charges and net allowances to provisions for impairment for bad debts.
Rental income includes gross rental income, including the effects of spreading stepped rents over the non-cancellable lease term, rent holidays and other benefits granted by contract to the lessee by the lessor, and notably reductions granted during the lease term.
In accordance with IFRS 16 :
When the lessor terminates a lease before its term, the lessor pays a termination fee to the tenant in place.
If payment of an early termination fee enables performance of the asset to be enhanced (such as by replacing a tenant, increasing the rent and thereby the value of the asset), this expenditure may be capitalized. If not, this expenditure is expensed as incurred.
If an early termination fee is paid as part of major renovation or reconstruction work on a building that requires tenants to leave, this expenditure is capitalized and included in the cost price of the asset under development or redevelopment.
Land expenses correspond to the variable amounts of fees for temporary occupancy permits and construction leases. These variable amounts do not fall within the scope of IFRS 16.
Non-recovered rental expenses are expenses normally passed on to tenants (rental expenses, local taxes, etc.), but for which the owner is still liable due to their ceiling or the vacancy of rental floor areas.
Other expenses include the lessor's contributions to the centers' marketing, non-capitalized construction work not passed on to the tenants, rental management fees on certain leases.
Net property income is the difference between revenues and cost of sales, selling expenses and net allowances for impairment on bad debt and inventories.
It corresponds primarily to the net property incomeon the Residential and Business property sectors, plus the net property incomeon sales of projects related to the development business in the Retail sector.
For property development activities, the net property income is recognised in the Group's financial statements using the percentage-of-completion method.
All property development/off-plan sales and property development contract transactions are concerned by this method.
For these programmes, revenue from notarized sales is recognised, in accordance with IFRS 15 "Revenue from contracts with customers", in proportion to the percentage of completion of the programmes, measured by the total percentage of costs directly related to construction (including the cost of land) incurred in comparison to the total forecast budget (updated at each closing date) combined with the percentage of sales realized determined relative to budget total sales.
The event giving rise to recognition of percentage-ofcompletion revenue is thus the purchase of the land combined with the signature of deeds of sale (notarized sales).
Net property income on property development projects is measured according to the percentage-of-completion method based on the following criteria:
Losses on "new projects" are included in net property income.
Net overhead expenses correspond to income and expense items inherent in the business of the Group's service companies.
For each operating segment, income includes payments for services provided to third parties, such as delegated project management fees related to Property Development activities, rental management fees (syndicate agent, co-ownership management), and fees for marketing and other services, internal management fees (after elimination of inter-company profit margins – see note on investment properties or inventories).
Expenses includes personnel costs, overhead costs (miscellaneous fees, operating expenses, etc. excluding fixed rent paid which has now been re-stated in accordance with IFRS 16), as well as depreciation of operating assets. Capitalized production and production held in inventory is deducted from this amount.
Other income and expenses relate to Group companies that are not service providers. They mainly correspond to overhead costs and miscellaneous management fee income. Amortization of intangible assets and depreciation of property, plant and equipment other than assets in operation are included in this line item.
Since the 1 January 2019, the Group applies IFRS 16 - Leases.
For landlords, IFRS 16 maintains the distinction between finance and operating leases. Accordingly, in the consolidated financial statements where the Group acts as lessor:
Under IFRS 16, lessees will no longer distinguish between finance lease contracts and operating lease contracts.
For all leases defined as "lease agreements", this standard requires to recognise a right-of-use asset in the balance sheet statement of the tenants (as non-current assets) and a corresponding lease liability (as financial liabilities).
Leases entered into by the Group lying within the field of application of the standard mainly concern two types of leases which are financially fundamentally different:
Temporary Occupation Authorizations are covered by IFRS 16. The Group is the occupying party and, therefore, the agreement grants the Group certain rights regarding the work, constructions and real estate facilities. Under IFRS 16, fixed fees are restated over the term of the contracts.
The key assumptions used to calculate the debt and therefore the right of use are the term of the contracts and the rate:
The presentation in the Group's financial statements is as follows:
• on the balance sheet, an asset is recorded in the form of a right-of-use asset in exchange for a liability corresponding to the rent. The Group therefore acknowledges a right-of-use on tangible and intangible fixed assets (connected to its property and vehicle lease agreements) as consideration for its lease liabilities; and a right-of-use for investment property (notably in relation to Temporary Occupation Authorizations) in exchange on the contractual fees on investment properties,
The change in amounts reflects new contracts or the end of contracts during the period. Moreover, during the lifetime of the agreement, lease liability and right-of-use asset may vary based on changes in the rent index defined in the leases. The main indexes are: the French national construction costs index, the French office rent index, the French commercial rent index and the French benchmark rent index.
The gain or loss on disposal of investment properties is the difference between:
Adjustments to the value of each property measured at fair value are recognised in the income statement under "Change in value of investment properties" and are determined as follows:
Market value excluding transfer duties at the end of the period (taking into account the impact of stepped rents and rent holidays as measured by the appraiser) minus [Market value at the end of the previous period if the property was measured at fair value or cost of the property is marked to market for the first time + amount of construction work and expenses eligible for capitalization during the year + effect of deferral period for stepped rents and rent holidays net of the deferral of initial lease payments].
Moreover, impairment losses on each property measured at cost are recognised in the income statement under "Net impairment of investment properties measured at cost".
In accordance with IAS 23, borrowing costs directly attributable to the construction of qualifying assets are included in the cost of these assets. Interest expenses continue to be allocated to buildings under development and construction over the construction period of the asset if they meet the definition of a "qualifying assets".
Where there is a significant delay in the construction project, Management may decide, if the delay is unusually long, not to capitalize the interest expenses attributable any longer. Management estimates the date at which the capitalization of interest expenses may resume.
The cost of net financial debt includes interest incurred on borrowings including the amortization of issuance expenses, and other financial liabilities, income from loans and advances to participating interests, gains on sale of marketable securities and the impact of interest-rate swaps used as interest-rate hedges.
Other financial results include expenses related to rental obligations and contractual fees on investment properties.
This line item shows the combined effect of discounting payables and receivables due in more than one year to present value.
The cash flow statement is presented using the indirect method permitted under IAS 7. Tax expense is shown as a single item in cash flows from operating activities. Interest paid is shown in cash flows from financing activities, and interest received is shown in cash flows from investing activities. Dividends paid are classified as cash flows from financing activities.
IFRS 8 – "Operating segments" requires the presentation of operating segments to reflect the Company's organisation and internal reporting system, which is presented in compliance with IFRS recognition and measurement principles. An operating segment represents an activity of the Company that incurs income and expenses and whose operating income is regularly reviewed by the Company's Management on the one hand and its operational managers on the other. Each segment has isolated financial information.
The Company's internal reporting is based on an analysis of the period's results in accordance with:
According to these analytical criteria, operating income, including earnings from equity affiliates, is monitored on an operating segment basis.
1 Funds From Operations.
In addition to operating income, asset book values (and certain related liabilities) are monitored by operating segment when they are directly related or can be allocated to a sector. They are considered economic assets of the sector in question.
The Company has the following operating segments:
Items under "Others (Corporate)" allow reconciliation of various reporting indicators with accounting indicators.
Borrowing costs, changes in the value of financial instruments and gains and losses from their disposal, taxes, and earnings from minority interests are not allocated directly by sector. Balance-sheet items such as financial assets and liabilities cannot be allocated, nor can deferred-tax assets corresponding to the recognition of tax losses.
FFO measures the creation of wealth available for distribution through net income (Group share of FFO). Funds from operations are defined as net income, Group share (i.e. attributable to equity holders of the parent company), exclusive of changes in value, estimated expenses, and transaction costs.
The main aggregates of the funds from operations monitored by the Group for internal reporting purposes are:
Net borrowing costs are the net borrowing costs excluding calculated expenses which correspond in particular to the spreading of bond issue costs (shown in changes in value, estimated expenses and transaction fees).
Other financial results mainly correspond to expenses related to rental obligations and contractual fees on investment properties.
Tax (FFO) is the tax due for the period excluding deferred taxes and excluding tax due relating to changes in value (exit tax, etc.).
These changes in value measure the value created or realized by the Company during the period.
The relevant indicator for monitoring value is the change in going concern net asset value, to which funds from operations contribute. This management indicator is presented in detail in the business review
The main aggregates of the funds from operations monitored by the Group in internal reports are:
Also presented are changes in value and income from disposal of financial instruments representing adjustments in the value of financial instruments measured at fair value as well as the effect of discounting debt and receivables. Results from the disposal of financial instruments represent the balance for amounts incurred in the period from restructuring or cancelling financial instruments.
The line relating to minority interests corresponds to the share of net income attributable to minority shareholders of subsidiaries divided between the share of the funds from operations (FFO) and the share attributable to minority shareholders of subsidiaries of changes in value, estimated expenses, transaction costs and deferred tax.
In the case of exceptional transactions, contracts are specifically analysed and the indicators presented above may in some cases be adjusted, i.e. reclassified to match the presentations in internal reports for greater clarity.
| (€ millions) | Retail | Residential | Business Property |
Others | TOTAL |
|---|---|---|---|---|---|
| Operating assets and liabilities | |||||
| Intangible assets | 18,0 | 282.3 | 21,5 | 10,6 | 332,5 |
| Property, plant and equipment | 0,7 | 24.7 | – | 2,3 | 27,8 |
| Right-of-use on tangible and intangible fixed assets | 0,3 | 127.9 | 0,1 | 0,1 | 128,4 |
| Investment properties | 4 140.6 | 0,2 | 36.0 | – | 4 176.8 |
| Securities and investments in equity affiliates | 121.9 | 170.7 | 166.8 | – | 459,4 |
| Operational working capital requirement | 58.7 | 682.0 | 13.1 | (23.2) | 730,6 |
| Total operating assets and liabilities | 4340.2 | 1,288.0 | 237.5 | (10,2) | 5 855.5 |
| (€ millions) | Retail | Residential | Business Property |
Others | TOTAL |
|---|---|---|---|---|---|
| Operating assets and liabilities | |||||
| Intangible assets | 18.2 | 281.8 | 21,5 | 8,9 | 330,4 |
| Property, plant and equipment | 1,5 | 23.3 | – | 1,3 | 26,1 |
| Right-of-use on tangible and intangible fixed assets | 0,4 | 139.3 | 0.0 | 0,6 | 140,3 |
| Investment properties | 3 991.8 | – | 32,8 | – | 4,024.6 |
| Securities and investments in equity affiliates | 117.2 | 157.8 | 304.7 | – | 579,6 |
| Operational working capital requirement | 46.8 | 534.3 | 61.8 | (12.5) | 630,4 |
| Total operating assets and liabilities | 4,176.0 | 1,136.5 | 420.7 | (1,6) | 5 731.5 |
See consolidated income statement by segment in the notes to the financial statements.
| (€ millions) | Funds from operations (FFO) |
31/12/2021 Changes in value, estimated expenses and transaction costs (chg. val.) |
Total | Funds from operations (FFO) |
31/12/2020 Changes in value, estimated expenses and transaction costs (chg. val.) |
Total |
|---|---|---|---|---|---|---|
| Rental income | 186,7 | – | 186,7 | 184,9 | – | 184,9 |
| Property expenses | (1,9) | – | (1,9) | (1,9) | – | (1,9) |
| Unrecoverable rental expenses | (8,9) | – | (8,9) | (8,7) | – | (8,7) |
| Expenses re-invoiced to tenants | 55,1 | – | 55,1 | 53,4 | – | 53,4 |
| Rental expenses | (64,0) | – | (64,0) | (62,2) | – | (62,2) |
| Other expenses | (1,6) | – | (1,6) | 1,2 | – | 1,2 |
| Net charge to provisions for current assets | (11,8) | – | (11,8) | (16,1) | – | (16,1) |
| Net rental income | 162,5 | – | 162,5 | 159,3 | – | 159,3 |
| Revenue Cost of sales |
2 796,2 (2,446.4) |
0.0 (0,1) |
2 796,2 (2,446.5) |
2 837,0 (2 496,4) |
– 0.0 |
2 837,0 (2 496,4) |
| Other income | (102,4) | (0.0) | (102,4) | (107,0) | – | (107,0) |
| Net charge to provisions for current assets | (10.3) | 0,2 | (10,1) | (9,3) | 0.0 | (9,2) |
| Amortisation of customer relationships | – | – | – | – | (0,6) | (0,6) |
| Net property income | 237.1 | 0,1 | 237,2 | 224.3 | (0,6) | 223,8 |
| External services | 46,9 | – | 46,9 | 34,3 | – | 34,3 |
| Own work capitalised and production held in inventory | 196,6 | – | 196,6 | 182,5 | – | 182,5 |
| Personnel costs | (223.9) | (29.7) | (253,6) | (210.9) | (14,5) | (225,3) |
| Other overhead expenses Depreciation expenses on operating assets |
(68.0) – |
(0.0) (29,5) |
(68,1) (29,5) |
(71.7) – |
0,2 (31,8) |
(71,5) (31,8) |
| Net overhead expenses | (48.4) | (59,3) | (107,6) | (65.8) | (46.2) | (111,9) |
| Other income and expenses | (9,0) | (0,9) | (9,8) | 1,9 | (1,5) | 0,4 |
| Depreciation expenses | – | (0,2) | (0,2) | – | (1,9) | (1,9) |
| Transaction costs | – | (14,9) | (14,9) | – | (2,3) | (2,3) |
| Others | (9,0) | (15,9) | (24,9) | 1,9 | (5,8) | (3,8) |
| Proceeds from disposal of investment assets | – | 8,9 | 8,9 | – | 380,3 | 380,3 |
| Carrying amount of assets sold | – | (10,2) | (10,2) | – | (385,0) | (385,0) |
| Net gain/(loss) on disposal of investment assets | – | (1,3) | (1,3) | – | (4,7) | (4,7) |
| Change in value of investment properties Net impairment losses on investment properties measured at cost |
– – |
39,9 (4,8) |
39,9 (4,8) |
– – |
(580,7) (59,8) |
(580,7) (59,8) |
| Net impairment losses on other non-current assets | – | (1,2) | (1,2) | – | (0,1) | (0,1) |
| Net charge to provisions for risks and contingencies | – | (11,5) | (11,5) | – | 1,6 | 1,6 |
| Impairment of goodwill | – | – | – | – | (1,0) | (1,0) |
| OPERATING INCOME BEFORE THE SHARE OF NET INCOME OF EQUITY METHOD AFFILIATES |
342.3 | (54.0) | 288,3 | 319.8 | (697.2) | (377,4) |
| Share in earnings of equity-method affiliates | 24,3 | (5,2) | 19,1 | 51.6 | (1,3) | 50,2 |
| OPERATING INCOME AFTER THE SHARE OF NET INCOME OF EQUITY METHOD AFFILIATES |
366.6 | (59,2) | 307,4 | 371.4 | (698.6) | (327,2) |
| Net borrowing costs | (49,2) | (5,4) | (54,6) | (50,6) | (18,2) | (68,8) |
| Financial expenses | (63.1) | (5,4) | (68,5) | (57.6) | (18,2) | (75,8) |
| Financial income | 13,9 | – | 13,9 | 7,0 | – | 7,0 |
| Other financial results Change in value and income from disposal of financial instruments |
(20,1) – |
(8,6) 5,7 |
(28,7) 5,7 |
(7,7) – |
(9,5) (56,5) |
(17,1) (56,5) |
| Proceeds from the disposal of investments (a) | 38,3 | 7,9 | 46,2 | 0,2 | 0,6 | 0,8 |
| Profit before tax | 335,7 | (59,6) | 276,1 | 313,3 | (782,2) | (468,8) |
| Corporate income tax | (20,1) | 6,2 | (13,9) | (26,6) | (28,4) | (54,9) |
| NET INCOME | 315,6 | (53,4) | 262,1 | 286,8 | (810,5) | (523,8) |
| o/w Net income attributable to Altarea SCA shareholders | 264,4 | (52,7) | 211,6 | 230,3 | (538,1) | (307,7) |
| o/w Net income attributable to minority interests in subsidiaries | (51,2) | 0,7 | (50,5) | (56,5) | 272,5 | 216,0 |
| Average number of undiluted shares | 18 024 260 | 18 024 260 | 18 024 260 | 17 308 818 | 17 308 818 | 17 308 818 |
| Basic net income per share attributable to shareholders of Altarea SCA (€) | 14.67 | (2.93) | 11,74 | 13.31 | (31.09) | (17,78) |
| Diluted average number of shares (b) | 18 424 086 | 18 424 086 | 18 424 086 | 17 539 018 | 17 539 018 | 17 539 018 |
| Diluted net income per share attributable to shareholders of Altarea SCA | 14,35 | (2,86) | 11,49 | 13,13 | (30,68) | (17,55) |
(€) (a) Gains or losses on disposals of equity interests have been reallocated to each of the activities concerned by the gains or losses when it relates to an investment previously
fully consolidated or a share of the equity-method affiliates when the equity disposed of was previously in an equity-method company. (b) Pursuant to IAS 33, the weighted average number of shares (diluted and non-diluted) is retrospectively adjusted to take into account the capital increase with preferential
subscription rights held in December 2021.
| 31/12/2021 | 31/12/2020 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Retail | Residen tial |
BP (1) | Others | TOTAL | Retail | Residen tial |
BP (1) | Others | TOTAL | |
| (€ millions) Net rental income |
162,5 | – | – | – | 162,5 | 159,3 | – | – | – | 159,3 |
| Net property income | (0,9) | 204,0 | 34,2 | (0,1) | 237,2 | 0,1 | 201,7 | 22,0 | (0,1) | 223,8 |
| Net overhead expenses | (15,6) | (72.3) | (13.4) | (6,3) | (107,6) | (21.6) | (63.8) | (18.6) | (7,9) | (111,9) |
| Others | (9,5) | (5,4) | 1,4 | (11.3) | (24,9) | (3,8) | (4,2) | 4,7 | (0,6) | (3,8) |
| Net gain/(loss) on disposal of investment assets |
(1,3) | – | – | – | (1,3) | (4,7) | – | – | – | (4,7) |
| Value adjustments | 33,1 | (1,2) | 2,0 | – | 33.9 | (642,1) | (0,2) | 1,7 | – | (640.7) |
| Net charge to provisions for risks and | (10.6) | (1,1) | (0,2) | 0,3 | (11,5) | (0,5) | 0,6 | 0,2 | 0,3 | 0,6 |
| contingencies Share in earnings of equity-method affiliates |
0,8 | 11,4 | 7,0 | – | 19,1 | (12,4) | 8,3 | 54,3 | – | 50,2 |
| OPERATING INCOME (Statement of consolidated comprehensive income) |
158,4 | 135.4 | 31.0 | (17.4) | 307,4 | (525.7) | 142,3 | 64.4 | (8,3) | (327,2) |
| Reclassification of net gain/(loss) on disposal of investments |
38,3 | 38,3 | 0,6 | 0,2 | 0,8 | |||||
| OPERATING INCOME (Consolidated income statement by segment) |
158,4 | 137,7 | 69,3 | (19,7) | 345,8 | (525,1) | 142,3 | 64,6 | (8,3) | (326,4) |
(1) BP: Business property
| 31/12/2021 | 31/12/2020 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| (€ millions) | France | Italy | Spain | Others | Total | France | Italy | Spain | Others | Total | |
| Rental income | 170,8 | 6,3 | 9.5 | – | 186,7 | 166.7 | 7,9 | 10,3 | – | 184,9 | |
| External services | 22.2 | 1,3 | 0,3 | – | 23,8 | 16,7 | 1,0 | 0,3 | – | 17,9 | |
| Property development | 0.0 | 6,4 | – | – | 6,4 | – | 13,6 | – | – | 13,6 | |
| Retail | 193.0 | 14,0 | 9,8 | – | 216.8 | 183.5 | 22,5 | 10,5 | – | 216.4 | |
| Revenue | 2 484,7 | – | – | – | 2 484,7 | 2 406,9 | – | – | – | 2 406,9 | |
| External services | 13,3 | – | – | – | 13,3 | 10,1 | – | – | – | 10,1 | |
| Residential | 2 498,0 | – | – | – | 2 498,0 | 2 416,9 | – | – | – | 2 416,9 | |
| Revenue | 305,2 | – | – | – | 305,2 | 416,5 | – | – | – | 416,5 | |
| External services | 9.3 | – | – | 0,4 | 9,8 | 5,7 | – | – | 0,5 | 6,2 | |
| Business Property | 314.5 | – | – | 0,4 | 314.9 | 422.2 | – | – | 0,5 | 422.7 | |
| Others (Corporate) | 0,1 | – | – | – | 0,1 | 0,1 | – | – | – | 0,1 | |
| TOTAL | 3 005.6 | #REF! 14,0 |
9,8 | 0,4 | #REF! 3,029.8 |
#REF! 3,022.7 |
22,5 | #REF! 10,5 |
0,5 | 3,056.2 |
The Altarea Group operates mainly in France, Italy and Spain in 2021, as in 2020.
One client accounted for more than 10% of the Group's revenue in the Residential sector, i.e., €548 million in 2020 and €489.5 million in 2021.
On 30 June 2021, Altarea entered into exclusive negotiations with Primonial group shareholders (Bridgepoint, Latour Capital and Societe Generale Assurances) and its management, for a potential two-step acquisition, through a subsidiary, of the Primonial group.
Following the favourable opinion of the employee representative bodies of the relevant companies of the Primonial group, issued on 6 July 2021, a sale and investment agreement relating to the Acquisition was entered into on 23 July 2021.
The scope of the acquisition includes the real estate asset management activities (€32.4 billion in real estate assets under management at 31 December 2021 and gross property inflows of €4.0 billion in 2021, up by 72%) and distribution, and as well as a minority stake of 15% in La Financière de l'Echiquier2 (LFDE).
When the conditions precedent will be satisfied, the acquisition will be carried out in two stages, with the acquisition of a first controlling interest corresponding to 60% of Primonial's share capital during the {t1} {/t1} first quarter of 2022 ("Block 1"), followed by the acquisition of the remaining 40% ("Block 2"), this second phase taking place during the first {t2} {/t2} quarter of 2024. The Group incurred approximately €12 million in transaction costs during the reporting period.
These partnerships, which are shared 51% Altarea and at 49% Crédit Agricole Assurances, relate to two types of longterm performing assets: nine retail parks3 (signed in December 2021) and six retail outlets, the Paris-Montparnasse station and five Italian railway stations4 (finalised in early 2022).
Leasing activity was dynamic throughout 2021, including leases on restaurants and leisure facilities:
In 2021, Altarea reoriented its commercial policy towards Individuals in a context of scarcity of supply.
At the beginning of 2021, activity continued to be held back by delays in bringing projects to market, as a result of the COVID-19 pandemic, longer lead times in obtaining building permits and the commercial strategy focusing on block sales in 2020, which reduced available supply. The supply shortage gradually eased, particularly at the end of the year, thanks to the work carried out on all stages of the production cycle and the development of new regions (medium-sized cities located along transport routes or in coastal or border areas benefiting from favourable momentum).
In 2021, Altarea redirected the available offering towards Individuals, whose new orders increased by +27% in value (+42% for rental investment). Most sales were again to Individuals while sales to Institutionals fell back almost to precrisis levels.
This commercial strategy has enabled Altarea to increase the average margin of operations launched this year despite inflation affecting the cost price of projects.
After a year in 2020 marked by delays in deliveries and delays in certain projects due to the health situation and a wait-and-see attitude by operators in the face of the development of remote working, 2021 shows a strong recovery in activity at all levels of the production cycle, in Grand Paris and in the regions, and for all product categories developed by the Group (offices, head offices, university campuses, logistics platforms, hotels, etc.).
The Group has made significant progress, notably with:
As the leading business property developer in the regions, Altarea has been able to capitalise on its know-how to meet the expectations of this fast-growing market. The year 2021 confirms this trend, with in particular:
• three projects sold: a 50,000 m² logistics platform in Béziers, a 15,000 m² office building in Mérignac near
Thiais, Family Village in Limoges, Family Village and Le Village de Marques in Aubergenville.
2 Asset manager of UCITS financial products (equities, debt, structured products).
3 Les Portes de Brest Guipavas, Family Village Costières Sud in Nîmes, Family Village Les Hunaudières in Le Mans-Ruaudin, Les Portes d'Ambresis in Villeparisis, Castorama in Pierrelaye, Thiais Village in
4 Milan-Porte Garibaldi, Rome-Ostiense, Turin-Porte Susa, Padua, Naples-Afragola.
Bordeaux for Groupama, and a 6,000 m² building for Le Sytral in Villeurbanne,
During the year 2021, the Group raised €1.15 billion of new long-term financing with an average maturity of seven years. This new financing includes:
The Group strengthened its consolidated equity for a total amount of €758 million, of which:
• €7.8 million5 for the employee mutual fund which subscribed to a reserved capital increase (resulting in the creation of 60,580 new shares) testifying to the commitment of the Group's employees.
5 Average subscription of €5,843 per employee subscribing.
The main companies within the scope of consolidation, selected by revenue and total assets criteria, are as follows:
| 31/12/2021 | 31/12/2020 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| LEGAL | ||||||||||
| Companies ALTAREA |
FORM SCA |
SIREN 335480877 |
parent company | Method FC |
Interest 100.0% |
Integration 100.0% |
Method FC |
Interest 100.0% |
Integration 100.0% |
|
| Retail France | ||||||||||
| ALTAREA FRANCE | SCA | 324814219 | FC | 100.0% | 100.0% | FC | 100.0% | 100.0% | ||
| NR 21 | SCA | 335480877 | FC | 96.8% | 100.0% | FC | 84.4% | 100.0% | ||
| FONDS PROXIMITE | SNC | 348024050 | affiliate | EM | 25.0% | 25.0% | EM | 25.0% | 25.0% | |
| 80-98 RUE DE REUILLY | SCI | 420762775 | FC | 100.0% | 100.0% | IN | 0.0% | 0.0% | ||
| ALDETA | SASU | 311765762 | FC | 33.3% | 100.0% | FC | 33.3% | 100.0% | ||
| ALTA BLUE ALTAREA PROMOTION COMMERCE |
SAS SNC |
522193796 420490948 |
FC FC |
33.3% 100.0% |
100.0% 100.0% |
FC FC |
33.3% 100.0% |
100.0% 100.0% |
||
| ALTA CRP AUBERGENVILLE | SNC | 451226328 | FC | 51,0% | 100.0% | FC | 100.0% | 100.0% | ||
| ALTA AUSTERLITZ | SNC | 812196616 | FC | 100.0% | 100.0% | FC | 100.0% | 100.0% | ||
| BERCY VILLAGE | SCI | 384987517 | FC | 51,0% | 100.0% | FC | 51,0% | 100.0% | ||
| ALTA CARRE DE SOIE | SCI | 449231463 | joint venture | EM | 50.0% | 50.0% | EM | 50.0% | 50.0% | |
| FONCIERE CEZANNE MATIGNON | SNC | 348024050 | FC | 100.0% | 100.0% | FC | 100.0% | 100.0% | ||
| FONCIERE ALTAREA | SASU | 353900699 | FC | 100.0% | 100.0% | FC | 100.0% | 100.0% | ||
| SOCIETE D'AMENAGEMENT DE LA GARE DE L'EST | SNC | 481104420 | FC | 51,0% | 100.0% | FC | 51,0% | 100.0% | ||
| ALTA CRP GENNEVILLIERS | SNC | 488541228 | FC | 51,0% | 100.0% | FC | 51,0% | 100.0% | ||
| ALTA GRAMONT | SAS | 795254952 | FC | 51,0% | 100.0% | FC | 51,0% | 100.0% | ||
| ALTA CRP GUIPAVAS LIMOGES INVEST |
SNC SCI |
451282628 488237546 |
FC FC |
51,0% 50.9% |
100.0% 100.0% |
FC FC |
100.0% 100.0% |
100.0% 100.0% |
||
| SNC MACDONALD COMMERCES | SNC | 524049244 | affiliate | EM | 25.0% | 25.0% | EM | 25.0% | 25.0% | |
| ALTAREA MANAGEMENT | SNC | 509105375 | FC | 100.0% | 100.0% | FC | 100.0% | 100.0% | ||
| ALTA-MONTPARNASSE | SNC | 524049244 | FC | 100.0% | 100.0% | FC | 100.0% | 100.0% | ||
| LES VIGNOLES RETAIL PARK | SNC | 512086117 | FC | 51,0% | 100.0% | FC | 100.0% | 100.0% | ||
| OPCI ALTA COMMERCE EUROPE | SPPICAV | joint venture | EM | 29,9% | 29,9% | EM | 29,9% | 29,9% | ||
| ALTA ORGEVAL | SNC | 795338441 | FC | 99.9% | 100.0% | FC | 100.0% | 100.0% | ||
| ALTA QWARTZ | SNC | 433806726 | FC | 100.0% | 100.0% | FC | 100.0% | 100.0% | ||
| THIAIS SHOPPING CENTRE | SNC | 479873234 | FC | 51,0% | 100.0% | FC | 100.0% | 100.0% | ||
| ALTA CRP LA VALETTE | SNC | 494539687 | FC | 51,0% | 100.0% | FC | 51,0% | 100.0% | ||
| Retail Italy | ||||||||||
| ALTAGARES | SRL | N/A | FC | 100.0% | 100.0% | FC | 100.0% | 100.0% | ||
| ALTAREA ITALIA | SRL | N/A | FC | 100.0% | 100.0% | FC | 100.0% | 100.0% | ||
| Retail Spain | ||||||||||
| ALTAREA ESPANA | SRL | N/A | FC | 100.0% | 100.0% | FC | 100.0% | 100.0% | ||
| ALTAREA PATRIMAE | SRL | N/A | FC | 100.0% | 100.0% | FC | 100.0% | 100.0% | ||
| Residential | ||||||||||
| ALTAREIT | SCA | 552091050 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | ||
| COGEDIM RESIDENCES SERVICES | SNC | 394648455 | joint venture | EM | 64,9% | 65,0% | EM | 64,9% | 65,0% | |
| ALTAREA COGEDIM IDF GRANDE METROPOLE | SNC | 810928135 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | ||
| ALTAREA COGEDIM GRANDS PROJETS | SNC | 810926519 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | ||
| ALTAREA COGEDIM REGIONS SEVERINI |
SNC SNC |
810847905 848899977 |
FC FC |
99.9% 99.9% |
100.0% 100.0% |
FC FC |
99.9% 84.9% |
100.0% 100.0% |
||
| MARSEILLE MICHELET | SNC | 792774382 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | ||
| COEUR MOUGINS | SNC | 453830663 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | ||
| ISSY COEUR DE VILLE | SNC | 830181079 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | ||
| ISSY COEUR DE VILLE COMMERCES | SNC | 828184028 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | ||
| ALTA FAUBOURG | SASU | 444560874 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | ||
| ALTAREA SOLUTION FINANCEMENT | SNC | 504638784 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | ||
| HP | SAS | 480309731 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | ||
| HISTOIRE ET PATRIMOINE DEVELOPPEMENT | SAS | 480110931 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | ||
| HORIZONS | SNC | 825208093 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | ||
| MERIMEE | SNC | 849367016 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | ||
| HISTOIRE ET PATRIMOINE PARTENARIATS | SASU | 452727985 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | ||
| HISTOIRE ET PATRIMOINE PROMOTION ALTAREA COGEDIM ZAC VLS |
SASU SNC |
792751992 811910447 |
FC FC |
99.9% 99.9% |
100.0% 100.0% |
FC FC |
99.9% 99.9% |
100.0% 100.0% |
||
| PPP | SNC | 530593748 | FC | 99.9% | 100.0% | FC | 71.9% | 100.0% | ||
| PITCH PROMOTION | SAS | 450042338 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | ||
| SEVRAN FREINVILLE | SCCV | 801560079 | FC | 59.9% | 100.0% | FC | 59.9% | 100.0% | ||
| MAGNANVILLE MARE PASLOUE | SCCV | 823919287 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | ||
| ANDRESY CHÂTEAUBRIANT | SCCV | 838432094 | FC | 74,9% | 100.0% | FC | 74,9% | 100.0% | ||
| POISSY BEL ISLE | SCCV | 880172317 | joint venture | EM | 49.9% | 50.0% | EM | 49.9% | 50.0% | |
| BEZONS CŒUR DE VILLE A1 & A2-LOGEMENTS | SCCV | 819 929 845 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | ||
| GIF MOULON A4 | SCCV | 830886115 | FC | 25.0% | 100.0% | FC | 25.0% | 100.0% | ||
| BOBIGNY COEUR DE VILLE | SNC | 838941011 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | ||
| TOULOUSE TMA PLACE CENTRALE | SNC | 821922564 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | ||
| WR PARTICIPATIONS | SCI | 821453826 | joint venture | EM | 49.9% | 50.0% | EM | 49.9% | 50.0% | |
| MEUDON - PAUL DEMANGE | SCCV | 853608511 | joint venture | EM | 49.9% | 50.0% | EM | 49.9% | 50.0% | |
| CLICHY - PETIT | SCCV | 853 646 503 | joint venture | EM | 49.9% | 50.0% | EM | 49.9% | 50.0% |
| 31/12/2021 | 31/12/2020 | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| Companies | LEGAL FORM |
SIREN | Method | Interest | Integration | Method | Interest | Integration | |
| PITCH IMMO | SASU | 422989715 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| O FIL DU BOIS | SCCV | 838713055 | affiliate | EM | 48.9% | 49.0% | EM | 48.9% | 49.0% |
| LOGNES ENVERGURE | SCCV | 840897847 | joint venture | EM | 49.9% | 50.0% | EM | 49.9% | 50.0% |
| ARTCHIPEL | SCCV | 841150071 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| CLICHY ROGUET | SCCV | 880090212 | FC | 50.9% | 100.0% | FC | 50.9% | 100.0% | |
| RUEIL HIGH GARDEN | SCCV | 887670115 | FC | 59.9% | 100.0% | FC | 59.9% | 100.0% | |
| TOULOUSE ARENES ILOT 3.1 T1 and T2 | SAS | 814795779 | affiliate | EM | 39.9% | 40.0% | EM | 39.9% | 40.0% |
| COGEDIM HAUTS DE FRANCE | SNC | 420810475 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| MB TRANSACTIONS | SASU | 425039138 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| COGEDIM GESTION | SNC | 380375097 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| COVALENS | SNC | 309021277 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| COGEDIM PARIS METROPOLE | SNC | 319293916 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| ASNIERES AULAGNIER | SARL | 487631996 | joint venture | EM | 49.9% | 50.0% | EM | 49.9% | 50.0% |
| COGEDIM GRAND LYON | SNC | 300795358 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| COGEDIM MEDITERRANEE | SNC | 312347784 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| COGEDIM PROVENCE | SNC | 442739413 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| COGEDIM MIDI-PYRENEES | SNC | 447553207 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| COGEDIM GRENOBLE | SNC | 418868584 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| COGEDIM SAVOIES-LEMAN | SNC | 348145541 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| COGEDIM AQUITAINE | SNC | 388620015 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| COGEDIM ATLANTIQUE | SNC | 501734669 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| COGEDIM LANGUEDOC ROUSSILLON | SNC | 532818085 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| COGEDIM | SASU | 54500814 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| SNC SURESNES MALON | SNC | 832708663 | joint venture | EM | 49.9% | 50.0% | EM | 49.9% | 50.0% |
| SAS BAGNEUX 116 | SAS | 839324175 | FC | 50.9% | 100.0% | FC | 50.9% | 100.0% | |
| SAS CLICHY BOREALES | SAS | 879035939 | affiliate | EM | 30.0% | 30.0% | IN | 0.0% | 0.0% |
| AIX HYPPODROME | SCCV | 852642040 | FC | 79.9% | 100.0% | FC | 79.9% | 100.0% | |
| RESPIRE | SCCV | 807582267 | FC | 89.9% | 100.0% | FC | 89.9% | 100.0% | |
| LYON 8 RUE CROIX BARRET | SCCV | 849097522 | FC | 59.9% | 100.0% | FC | 59.9% | 100.0% | |
| LYON LES MOTEURS | SNC | 824866388 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| COGIMO | SAS | 962502068 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| CHIN HAUT CAREI | SCCV | 829544303 | FC | 59.9% | 100.0% | FC | 59.9% | 100.0% | |
| CALCADE DE MOUGINS | SNC | 833132426 | FC | 50.9% | 100.0% | FC | 50.9% | 100.0% | |
| LE TOUQUET DUBOC | SCCV | 812050870 | joint venture | EM | 49.9% | 50.0% | EM | 49.9% | 50.0% |
| SNC PROVENCE L'ÉTOILE | SNC | 501552947 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| HYRES L'AUFRENE | SCCV | 834122335 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| CLICHY ROSE GUERIN | SCCV | 885139188 | FC | 40,7% | 100.0% | FC | 40,7% | 100.0% | |
| WOODEUM RESIDENTIAL | SAS | 807674775 | EM | 50.0% | 50.0% | EM | 50.0% | 50.0% | |
| LA GARENNE CHATEAU | SCCV | 822309753 | FC | 59.9% | 100.0% | FC | 59.9% | 100.0% | |
| PIERRE BEREGOVOY | SCCV | 829581651 | FC | 54.9% | 100.0% | FC | 54.9% | 100.0% | |
| CHAMPIGNY ALEXANDRE FOURNY | SCCV | 829377894 | FC | 50.0% | 100.0% | FC | 50.0% | 100.0% | |
| BOURGET LECLERC | SCCV | 831267943 | FC | 50.9% | 100.0% | FC | 50.9% | 100.0% | |
| HORLOGE GASTON ROUSSEL | SCCV | 832294664 | FC | 50.9% | 100.0% | FC | 50.9% | 100.0% | |
| 61-75 PARIS AVENUE DE FRANCE | SCCV | 830917100 | joint venture | EM | 49.9% | 50.0% | EM | 49.9% | 50.0% |
| SURESNES BMV | SCCV | 834261497 | FC | 50.0% | 100.0% | FC | 50.0% | 100.0% | |
| ISSY POPLARS | SCCV | 838686236 | FC | 64,9% | 100.0% | FC | 64,9% | 100.0% | |
| MONTREUIL D 'ALEMBERT | SCCV | 841085210 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| ASNIERES 94 GRESILLONS | SCCV | 849115258 | FC | 50.9% | 100.0% | FC | 50.9% | 100.0% | |
| ISSY JEANNE D'ARC | SNC | 850443508 | FC | 50.9% | 100.0% | FC | 50.9% | 100.0% | |
| ROMAINVILLE ROUSSEAU | SCCV | 852604909 | FC | 50.9% | 100.0% | FC | 50.9% | 100.0% | |
| ISSY GUYNEMER | SNC | 891166209 | FC | 50.9% | 100.0% | FC | 50.9% | 100.0% | |
| SAINT MAUR CONDE | SCCV | 897792156 | FC | 69.9% | 100.0% | IN | 0.0% | 0.0% | |
| QUAI DE SEINE IN ALFORTVILLE | SCCV | 803321942 | joint venture | EM | 48.9% | 49.0% | EM | 48.9% | 49.0% |
| CROIX DE DAURADE | SCCV | 829774173 | FC | 50.9% | 100.0% | FC | 50.9% | 100.0% | |
| Business Property | |||||||||
| ALTAREA COGEDIM ENTREPRISE PROMOTION | SNC | 535056378 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| PRD MONTPARNASSE 2 | SCI | 852712439 | joint venture | EM | 50.0% | 50.0% | EM | 50.0% | 50.0% |
| PRD MONTPARNASSE 3 | SCI | 852712587 | joint venture | EM | 50.0% | 50.0% | EM | 50.0% | 50.0% |
| ALTAREA ENTREPRISE MANAGEMENT | SNC | 534207386 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| AF INVESTCO ARAGO | SNC | 494382351 | affiliate | EM | 30.1% | 30.1% | EM | 30.1% | 30.1% |
| AF INVESTCO 5 | SNC | 798601936 | affiliate | EM | 30.1% | 30.1% | EM | 30.1% | 30.1% |
| AF INVESTCO 7 | SNC | 798601936 | affiliate | EM | 30.1% | 30.1% | EM | 30.1% | 30.1% |
| B1 | SCCV | 853715829 | joint venture | EM | 33.3% | 33.3% | EM | 33.3% | 33.3% |
| B2 B3 | SCCV | 852921899 | joint venture | EM | 50.0% | 50.0% | EM | 50.0% | 50.0% |
| ALTA VAI HOLDCO A | SAS | 424007425 | FC | 99.9% | 100.0% | FC | 99.9% | 100.0% | |
| FONCIERE ALTAREA MONTPARNASSE | SNC | 847726650 | FC | 100.0% | 100.0% | FC | 100.0% | 100.0% | |
| ISSY PONT | SCI | 804865996 | joint venture | ME | 10,0% | 10,0% | ME | 25,0% | 25,0% |
| PASCALHOLDCO | SPPICAV | 809845951 | affiliate | ME | 15,0% | 15,1% | ME | 15,0% | 15,1% |
| PASCALPROPCO | SASU | 437929813 | affiliate | ME | 15,0% | 15,1% | ME | 15,0% | 15,1% |
| PRD MONTPARNASSE | SCI | 844634758 | joint venture | ME | 50,0% | 50,0% | ME | 50,0% | 50,0% |
| P11 DU BASSIN N°2 | SCCV | 812107217 | affiliate | ME | 49,9% | 50,0% | ME | 49,9% | 50,0% |
| BALMA CAMPUS WALLIS | SCCV | 840457881 | joint venture | ME | 50,0% | 50,1% | ME | 50,0% | 50,1% |
| ISSY COEUR DE VILLE PROMOTION BUREAUX | SNC | 829845536 | IG | 99,9% | 100,0% | IG | 99,9% | 100,0% |
| (in number of companies) | 31/12/2020 | Acquisition | Creation | Sale | Absorption, dissolution, deconsolidation |
Change in consolidation method |
31/12/2021 |
|---|---|---|---|---|---|---|---|
| Fully consolidated | 436 | 11 | 35 | (42) | 1 | 441 | |
| subsidiaries Joint ventures (a) |
138 | 1 | 11 | (7) | (1) | 142 | |
| Affiliates (a) | 78 | 2 | (2) | (7) | – | 71 | |
| Total | 652 | 12 | 48 | (2) | (56) | - | 654 |
(a) Companies accounted for using the equity method.
| (€ millions) | 31/12/2021 | 31/12/2020 |
|---|---|---|
| Investments in consolidated securities | (17.6) | (12,6) |
| Liabilities on acquisition of consolidated participating interests | – | 3,6 |
| Cash of acquired companies | (0,1) | 2.9 |
| Total | (17,7) | (6,0) |
During the financial year, the Group bought the securities of a company in a logistics site in Paris.
During the year,
The Group did not carry out any business combinations during the year.
In application of IFRS 10, 11 and 12, the following are recognised under securities and receivables on equity affiliates, investments in joint ventures and associated companies, including receivables from these holdings.
| (€ millions) | 31/12/2021 | 31/12/2020 |
|---|---|---|
| Equity-accounting value of joint ventures | 104,8 | 102,7 |
| Equity-accounting value of affiliated companies | 44,0 | 152,7 |
| Value of stake in equity-method affiliates | 148,8 | 255,4 |
| Receivables from joint ventures | 191.7 | 209.7 |
| Receivables from affiliated companies | 118.9 | 114.5 |
| Receivables from equity-method subsidiaries | 310,6 | 324,2 |
| Total securities and receivables in equity affiliates | 459,4 | 579,6 |
As of 31 December 2021, the decrease in the equity method value of associates is mainly due to dividend payments.
Receivables from joint ventures and receivables from affiliates relating to Property Development come to €273,6 million.
| (€ millions) | Joint ventures | Affiliates | 31/12/2021 | Joint ventures | Affiliates | 31/12/2020 |
|---|---|---|---|---|---|---|
| Balance sheet items, Group share: | ||||||
| Non-current assets | 397.2 | 226.7 | 623.9 | 379,4 | 204.5 | 583.9 |
| Current assets | 453.4 | 250.0 | 703.5 | 500.7 | 310.7 | 811.4 |
| Total Assets | 850.6 | 476.7 | 1 327.3 | 880.1 | 515.2 | 1395.3 |
| Non-current liabilities | 178,9 | 201.9 | 380.8 | 199.1 | 177.6 | 376.7 |
| Current liabilities | 566.9 | 230.9 | 797.8 | 578.3 | 184,9 | 763.2 |
| Total Liabilities | 745.8 | 432.7 | 1178.5 | 777.4 | 362.5 | 1139.9 |
| Net assets (equity-accounting basis) | 104,8 | 44,0 | 148,8 | 102,7 | 152,7 | 255,4 |
| Operating income | 26,2 | 3,6 | 29.7 | 17,5 | 36.2 | 53.8 |
|---|---|---|---|---|---|---|
| Net borrowing costs | (3,7) | (4,2) | (7,9) | (3,9) | (3.2) | (7.0) |
| Other financial results | (0,9) | (0,5) | (1,3) | (2,7) | (2,5) | (5,2) |
| Change in value of hedging instruments | 0,5 | 0,2 | 0,7 | (0,1) | (0,2) | (0,3) |
| Proceeds from the disposal of investments | – | – | – | 0.0 | (18,4) | (18,4) |
| Net income before tax | 22.1 | (0,9) | 21.2 | 10.9 | 11.9 | 22.8 |
| Corporate income tax | (1,8) | (0,2) | (2,0) | (3,7) | 31.1 | 27.4 |
| Net income by equity method (after tax) | 20,3 | (1,1) | 19,1 | 7,2 | 43,0 | 50,2 |
| Non-Group net income | (0.0) | 0.0 | (0.0) | (0.0) | (0.0) | (0.0) |
| Net income, Group share | 20,3 | (1,1) | 19,1 | 7,2 | 43,0 | 50,2 |
Group revenue from joint ventures amounted to €21.2 million for the year to 31 December 2021, compared with €16.3 million for 2020.
Cogedim Résidences Services undertook to pay rent in connection with the leasing of the Résidences Services Group revenue from affiliates amounted to €7.8 million for the year to 31 December 2021, compared with €6.8 million for 2020.
Cogedim Club®. In the context of the application of IFRS 16, these contracts have been restated in the financial statements of the companies.
In exchange, Cogedim Résidences Services receives the lease payments of the sub-lessees, these continuing to be commitments.
Financial guarantees for the completion of works were given as part of the property development activity, and amounted to a share of €76.4 million at 31 December 2021.
As of 31 December 2021, the main commitments received by the joint ventures relate to security deposits received from tenants in the amount of €2.6 million.
At 31 December 2021, current and non-current financial assets amounted to €50.3 million, compared with €34.6 million for 2020, and consist mainly of:
Net rental income includes rental income, land expenses, non-recovered service charges, other expenses and net allowances for impairment for bad debts. COVID-related write-offs and write-downs of receivables affect this item.
During the year, provisions for bad debts and reliefs related to the health crisis amounted to €28.5 million, including:
Net rental income amounted to €162.5 million in 2021, compared to €159.3 million in 2020, i.e. a decrease of 2.0%.
The Group's net property income stood at €237.2 million in 2021 compared to €223.8 million in 2020, i.e. an increase of 6.0%.
The Residential Backlog of the fully-consolidated companies was €3,450 million at 31 December 2021.
The Business Property Development Backlog of the fullyconsolidated companies was €372 million at 31 December 2021.
| (€ millions) | 31/12/2021 | 31/12/2020 |
|---|---|---|
| Bond and bank interest expenses | (55.6) | (55.0) |
| Interest on partners' advances | 3,9 | 3,6 |
| Interest rate on hedging instruments | 2,6 | (0,5) |
| Capitalised interest expenses | – | 1,5 |
| Other financial income and expenses | (0.0) | (0,1) |
| FFO financial income and expenses | (49,2) | (50,6) |
| Spreading of bond issue costs and other estimated expenses(a) | (5,4) | (18,2) |
| Net borrowing costs | (54,6) | (68,8) |
(a) Relates mainly to the deferral in accordance with the amortised cost method of the issue costs of borrowings and bond issue premiums in accordance with IFRS 9 for -€5.4 million.
Capitalised interest expenses relate only to companies carrying an asset under development or construction (traditional malls) and are deducted from interest paid to credit institutions.
The capitalisation rate used to determine the amounts of borrowing costs that may be included in the carrying amount of assets is the interest rate on financing assigned specifically to asset development or, if there is no specific financing, to the average cost of debt borne by the Company and not assigned specifically to another purpose.
The average cost of the debt includes all fees generated by both short-term and long-term financing instruments (such as commitment fees, non-utilisation fees, …) divided by the average value of the debt of given period. The Group cost (excluding the impact of IFRS 16) amounts to 1.80% as at 31 December 2021, compared with 1.94% as at 31 December 2020.
Other financial results correspond in particular to interest expenses on rental obligations or royalties on investment properties.
This item is mainly a net expense of €5.7 million, of which - €12.7 million related to compensation payments (paid or pending) on financial instruments (compared to -€78.2 million as of 31 December 2020) and €18.4 million in change in fair value of interest rate hedging instruments (compared to - €67.3 million as of 31 December 2020).
Tax expense is analysed as follows:
| (€ millions) | 31/12/2021 | 31/12/2020 | |
|---|---|---|---|
| Tax due | (20,1) | (26,6) | |
| Tax loss carry forwards and/or use of deferred losses | (16.7) | (50,6) | |
| Valuation differences | 0.0 | 0,2 | |
| Fair value of investment properties | 0,7 | 22.9 | |
| Fair value of hedging instruments | 0.0 | (0,2) | |
| Income by percentage of completion | 13.7 | (5,2) | |
| Other timing differences | 8.4 | 4,6 | |
| Deferred tax | 6.2 | (28,4) | |
| Total income (expense) tax | (13.9) | (54,9) |
| (€ millions) | 31/12/2021 | 31/12/2020 |
|---|---|---|
| Pre-tax profit of consolidated companies | 256.9 | (519.1) |
| Group tax savings (expense) | (13.9) | (54,9) |
| Effective tax rate | (5.42)% | 10.58% |
| Tax rate in France | 27.37% | 28.92% |
| Theoretical tax charge | (70.3) | 150.1 |
| Difference between theoretical and effective tax charge | 56.4 | (205.0) |
| Differences related to entities' SIIC status | 27.0 | (192.0) |
| Differences related to treatment of losses | 3,5 | (5,8) |
| Other permanent differences and rate differences | 25.8 | (7.3) |
| (€ millions) | 31/12/2021 | 31/12/2020 | |
|---|---|---|---|
| Tax loss carry forwards | 62.3 | 78.9 | |
| Valuation differences | (27.2) | (35.3) | |
| Fair value of investment properties | (19.4) | (19.9) | |
| Fair value of financial instruments | (0.2) | (0.2) | |
| Income by % of completion | (61.9) | (74.0) | |
| Other timing differences | 1.1 | (0.8) | |
| Net deferred tax on the balance sheet | (45.4) | (51.2) |
As at 31 December 2021, the Group had unrecognised tax loss carry-forwards of €403.2 million (basis), as compared with €425.5 million for the year ending 31 December 2020.
Deferred taxes relating to valuation differences correspond primarily to the brands held by the Group.
Deferred taxes relating to the activation of tax losses mainly relate to losses recognised in the tax consolidation group Altareit and losses partially activated in the taxable sector of some SIIC' companies.
Deferred taxes are calculated (for French companies which are part of the Group's main consolidation scope) at the rate of 25.83%, the rate set by the Finance Act for 2022, and not at the rate of 27.37% applicable in 2021.
Altarea SCA received proposed tax adjustments relating to the financial years 2017, 2018 and 2019. All the potential financial consequences have been recognised with the exception of certain disputed adjustments which total €0.9 million.
Net income per share (basic earnings per share) is the net income (Group share) compared to the weighted average number of shares in issue during the period, less the weighted average number of treasury shares.
To calculate the diluted net income per share, the weighted average number of shares in issue is adjusted to take into account the potentially dilutive effect of all equity instruments issued by the Company.
As in 2020, the dilution arose only from the granting of rights to free shares in Altarea SCA to Group employees.
The average number of shares in 2020 was adjusted to take into account the capital increase carried out in December 2021 with preferential subscription rights (PSR) in accordance with IAS 33. The preferential subscription right is treated as a value distributed free of charge to shareholders.
The adjustment coefficient is based on the ratio between the value of the share before detachment of the preferential subscription right and the value of the share ex this right. This coefficient was applied until the date of the capital increase.
The average number of undiluted shares reported as 16,850,855 in 2020 is adjusted to 17,308,818, which corresponds to an undiluted net earnings per share of - €17.78 instead of -€18.26 published.
The published average number of diluted shares for 2020 is adjusted from 17,081,054 reported to 17,539,018, which corresponds to a diluted 2020 net earnings per share of - €17.55 instead of -€18.02 published.
| (€ millions) | 31/12/2021 | 31/12/2020 |
|---|---|---|
| Numerator | ||
| Net income, Group share | 211,6 | (307,7) |
| Denominator | ||
| Weighted average number of shares before dilution |
18 024 260 | 17 308 818 |
| Effect of potentially dilutive shares | ||
| Stock options | 0 | 0 |
| Rights to free share grants | 399 826 | 230 199 |
| Total potential dilutive effect | 399 826 | 230 199 |
| Weighted diluted average number of shares |
18 424 086 | 17 539 018 |
| NET INCOME, GROUP SHARE, UNDILUTED PER SHARE (€) |
11,74 | (17,78) |
| NET INCOME, GROUP SHARE, DILUTED PER SHARE (€) |
11,49 | (17,55) |
| In number of shares and in € | Number of shares |
Nominal | Share capital |
|---|---|---|---|
| Number of shares outstanding at 31 December 2019 | 16 700 762 | 15.28 | 255 195 822 |
| Share capital increase via the part-conversion of dividends into shares | 508 199 | 15.28 | 7 765 281 |
| Share capital increase reserved for Mutual Funds | 66 878 | 15.28 | 1 021 896 |
| Number of shares outstanding at 31 December 2020 | 17 275 839 | 15.28 | 263 982 998 |
| Share capital increase reserved for SCI VDE Reuilly shareholders | 39 277 | 15.28 | 600 153 |
| Share capital increase via the part-conversion of dividends into shares | 60 580 | 15.28 | 925 662 |
| Share capital increase reserved for Mutual Funds | 482 385 | 15.28 | 7,370,843 |
| Share capital increase of 10 December 2021 | 2 435 190 | 15.28 | 37,209,703 |
| Number of shares outstanding at 31 December 2021 | 20 293 271 | 15.28 | 310 089 359 |
The aim of the Group's capital management is to ensure liquidity and optimise its capital structure.
The Company's policy is to maintain its LTV (Loan to Value) ratio at around 40%, excluding temporarily exceeding that level or exceptional transactions. The corporate loan agreement clauses specifically stipulate that the Group must maintain an LTV ratio below 60%.
The gross expense recorded on the income statement for share-based payments was €23.4 million at 31 December 2021 compared to €12.5 million in 2020.
No stock option plans were in force at 31 December 2021. Free share grants
| Award date | Number of rights awarded |
Vesting date | Rights in circulation at 31/12/2020 |
Awarded | Deliveries | Amendments to rights (a) |
Rights in circulation at 31/12/2021 |
|---|---|---|---|---|---|---|---|
| Share grant plans on Altarea shares | |||||||
| 20 July 2018 | 41 500 (b) | 31 March 2021 | 30,800 | (30,800) | – | ||
| 7 September 2018 | 14,800 (b) | 31 March 2021 | 7 400 | (7,400) | – | ||
| 3 December 2018 | 5,000 (b) | 31 March 2021 | 2 000 | (2 000) | – | ||
| 19 December 2018 | 2,000 (b) | 31 March 2021 | 2 000 | (2 000) | – | ||
| 18 March 2019 | 9 461 | 12 March 2021 | 9,079 | (8 837) | (242) | ||
| 19 March 2019 | 41 531 | 19 March 2022 | 37 347 | (2 983) | 34 364 | ||
| 6 June 2019 | 1 355 | 20 March 2022 | 1,220 | (80) | 1140 | ||
| 18 October 2019 | 2 000 | 30 March 2021 | 2 000 | (2 000) | – | ||
| 21 October 2019 | 20,000 (b) | 30 March 2022 | 20 000 | – | 20 000 | ||
| 18 December 2019 | 3,000 (b) | 31 March 2021 | 2,400 | (2,400) | – | ||
| 10 January 2020 | 1 300 | 10 January 2021 | 1 300 | (1,300) | – | ||
| 20 April 2020 | 58,809 | 20 April 2021 | 58 477 | (57 374) | (1,103) | ||
| 21 April 2020 | 18 479 | 21 April 2022 | 18 411 | (448) | 17 963 | ||
| 22 April 2020 | 45,325 | 22 April 2023 | 43 952 | (3078) | 40 874 | ||
| 23 April 2020 | 1 000 | 23 April 2021 | 1 000 | (1000) | – | ||
| 24 April 2020 | 2 000 | 24 April 2022 | 2 000 | – | 2 000 | ||
| 30 April 2020 | 4,900 | 30 April 2021 | 4,600 | (4,600) | – | ||
| 1 October 2020 | 89 | 1 October 2021 | 89 | (89) | – | ||
| 31 March 2021 | 121 080 | 1 April 2022 | 121 080 | (2418) | 118 662 | ||
| 31 March 2021 | 10 000 | 1 April 2022 | 10 000 | – | 10 000 | ||
| 30 April 2021 | 73 050 (b) | 31 March 2024 | 73 050 | (2 005) | 71 045 | ||
| 4 June 2021 | 32,000 (b) | 31 March 2025 | 32 000 | – | 32 000 | ||
| 4 June 2021 | 27 500 (b) | 31 March 2025 | 27 500 | – | 27 500 | ||
| 4 June 2021 | 45 500 (b) | 31 March 2025 | 45 500 | – | 45 500 | ||
| 4 June 2021 | 14,000 (b) | 31 March 2025 | 14 000 | – | 14 000 | ||
| 4 June 2021 | 23 700 (b) | 31 March 2025 | 23 700 | – | 23 700 | ||
| 4 June 2021 | 30,000 (b) | 31 March 2025 | 30 000 | – | 30 000 | ||
| 1 September 2021 | 600 | 1 September 2023 | 600 | – | 600 | ||
| 1 October 2021 | 2 000 | 30 March 2023 | 2 000 | – | 2 000 | ||
| Total | 651 979 | 244,075 | 379 430 | (119,800) | (12 357) | 491 348 |
(a) Rights cancelled for reasons of departure, transfer, lack of certainty that performance criteria have been met or changes in plan terms.
(b) Plans subject to performance criteria.
| 31/12/2021 | |
|---|---|
| Dividend rate | 6.0% |
| Risk-free interest rate | 0.0% |
The acquisition cost of treasury shares was €33.8 million at 31 December 2021 for 205,406 shares (including 204,799 shares intended for allotment to employees under free share grant or stock option plans and 607 shares allocated to a liquidity contract), compared with €23.9 million at 31 December 2020 for 139,322 shares (including 139,095 shares intended for allotment to employees under free share grant or stock option plans and 227 shares allocated to a liquidity contract). Treasury shares are eliminated and offset directly in equity.
In addition, a net loss on disposal and/or free share grants of treasury shares to Company employees was recognised directly in equity in the amount of -€21.5 million before tax at 31 December 2021 (-€15.9 million after tax) compared with - €15.0 million at 31 December 2020 (-€10.9 million before tax).
The negative impact on cash flow from purchases and disposals over the period came to -€31.3 million at 31 December 2021 compared to -€5.9 million at 31 December 2020.
| (€ millions) | 31/12/2021 | 31/12/2020 |
|---|---|---|
| Paid in current year in respect of previous year: | ||
| Dividend per share (€) | 9.50 | 9.00 |
| Payment to shareholders of the Altarea Group | 163.6 | 149.1 |
| Proportional payment to the general partner (1.5%) | 2,5 | 2,3 |
| Total | 166.1 | 151.4 |
| Offer to convert dividends into shares: | ||
| Subscription price (€) | 155.51 | 120.79 |
| Total amount of conversion into shares | 88.6 | 61.4 |
| Rate of conversion of dividends into shares on the 50% option | 91.59% | 82.28% |
A dividend of €9.75/share will be proposed to the General Shareholders' Meeting called to vote upon the approval of the accounts for the financial year ending December 31, 2021.
Shareholders will also be offered the option to partially convert the dividend into shares. They will be free to choose between:
| Cash flow | "Non-cash" change | |||||||
|---|---|---|---|---|---|---|---|---|
| (€ millions) | 31/12/2020 | Spreading of issue costs |
Change in scope of consolidation |
Update | Change in method |
Reclassif ication |
31/12/2021 | |
| Bonds (excluding accrued interest) | 1,950.4 | (228.5) | 1,4 | – | – | – | – | 1,723.2 |
| Short and medium term negotiable securities | 653.0 | 106.0 | – | – | – | – | – | 759.0 |
| Bank borrowings, excluding accrued interest and overdrafts | 836.4 | (94.0) | 4,0 | (0.0) | – | – | – | 746.4 |
| Net bond and bank debt, excluding accrued interest and overdrafts | 3 439.7 | (216,5) | 5,4 | (0.0) | – | – | – | 3,228.6 |
| Accrued interest on bond and bank borrowings | 26,5 | 2,5 | – | – | – | – | – | 29.0 |
| Bond and bank debt, excluding overdrafts | 3 466.2 | (214.0) | 5,4 | (0.0) | – | – | – | 3 257.6 |
| Cash and cash equivalents | (1 277.5) | (348.0) | – | – | – | 0.0 | – | (1,625.5) |
| Bank overdrafts | 3,9 | 9,7 | – | – | – | – | – | 13,6 |
| Net cash | (1 273.6) | (338.4) | – | – | – | 0.0 | – | (1,612.0) |
| Net bond and bank debt | 2,192.6 | (552.4) | 5,4 | (0.0) | – | 0.0 | – | 1,645.6 |
| Equity loans and Group and partners' advances | 270.0 | (134,1) | – | (1,7) | – | – | (0.0) | 134,2 |
| Accrued interest on shareholders' advances | 0,7 | 0.0 | – | – | – | (0.0) | – | 0,7 |
| Lease liabilities | 150.4 | (2,3) | – | – | – | – | 6.1 | 154.3 |
| Contractual fees on investment properties | 178.8 | (15,5) | – | – | – | – | 6,6 | 169.9 |
| Net financial debt | 2,792.5 | (704.3) | 5,4 | (1,7) | – | 0.0 | 12.7 | 2,104.7 |
Group net financial bond and bank debt amounted to €1,645.6 million at 31 December 2021 compared to €2,192.6 million at 31 December 2020.
At 31 December 2021, no revolving loan had been drawn down.
Borrowing costs are analysed in the note on earnings.
Net cash amounts to €1,612.0 million, of which cash equivalents (mainly time deposit accounts for €50.3 million) are recorded at fair value at each closing date.
| (€ millions) | 31/12/2021 | 31/12/2020 |
|---|---|---|
| < 3 months | 366.3 | 271.9 |
| 3 to 6 months | 170.2 | 894.2 |
| 6 to 9 months | 114.2 | 91.7 |
| 9 to 12 months | 93.8 | 88.0 |
| At less than 1 year | 744.6 | 1,345.8 |
| At 2 years | 209.1 | 153.0 |
| At 3 years | 541.8 | 124.2 |
| At 4 years | 540.2 | 451.6 |
| At 5 years | 106.1 | 540.0 |
| 1 to 5 years | 1,397.3 | 1,268.7 |
| More than 5 years | 1,144.9 | 869.8 |
| Issuance cost to be amortised | (15,6) | (14,2) |
| Total gross bond and bank debt | 3 271,1 | 3 470,1 |
The decrease in the portion of bond and bank debt due in less than one year is mainly explained by the reduction in mortgage debt on Cap 3000 and by the maturing of bonds issued by Altarea in 2014. The portion at more than five years increased following the refinancing of the mortgage debt on Cap 3000.
| (€ millions) | 31/12/2021 | 31/12/2020 |
|---|---|---|
| Mortgages | 350.0 | 400,0 |
| Mortgage commitments | 114.4 | 150.6 |
| Moneylender lien | 10,8 | 11.6 |
| Altarea SCA security deposit | 200,0 | 200,0 |
| Not guaranteed | 2,611.6 | 2 722.1 |
| Total | 3286.8 | 3 484.3 |
| Issuance cost to be amortised | (15,6) | (14,2) |
| Total gross bond and bank debt | 3 271,1 | 3 470,1 |
Mortgages are given as collateral for the financing or refinancing of investment properties. Mortgage commitments and the lender's lien mainly concern Property Development activities.
| Gross bond and bank debt | |||
|---|---|---|---|
| (€ millions) | Variable rate | Fixed rate | Total |
| As of 31 December | 1,521.9 | 1,749.3 | 3 271,1 |
| 2021 As of 31 December 2020 |
1,495.2 | 1 974.9 | 3 470,1 |
The market value of fixed rate debt stood at €1,789.4 million at 31 December 2021 compared to €2,050.9 million at 31 December 2020.
| (€ millions) | 31/12/2021 | 31/12/2020 |
|---|---|---|
| < 3 months | 3,9 | 3,7 |
| 3 to 6 months | 4,9 | 9.0 |
| 6 to 9 months | 17,5 | 14.1 |
| 9 to 12 months | 6,0 | 4,9 |
| At less than 1 year | 32.3 | 31,7 |
| At 2 years | 52,9 | 49.4 |
| At 3 years | 52.1 | 47.0 |
| At 4 years | 41.5 | 45.4 |
| At 5 years | 19.7 | 37.0 |
| 1 to 5 years | 166.2 | 178.7 |
These future interest expenses concern borrowings and financial instruments, and are presented exclusive of accrued interest not payable.
Lease liabilities are debts mainly relating to real estate leases and vehicle leases (respectively for the premises occupied and the vehicles used by Group employees).
These liabilities amounted to €154.3 million at 31 December 2021 compared to €150.4 million at 31 December 2020. They seen in light of the right-of-use assets on tangible and intangible assets.
Contractual fees on investment properties, which are economically different in nature from rental obligations, concern debts relating to temporary occupancy authorisations and construction leases on retail assets (mainly stations).
They amounted to €169.9 million at 31 December 2021 compared to €178.8 million at 31 December 2020 and are to be seen in light of the right-of-use assets on investment properties (assets that generate income).
| (€ millions) | 31/12/2021 | 31/12/2020 |
|---|---|---|
| < 3 months | 4,6 | 2,5 |
| 3 to 6 months | 4,6 | 1,7 |
| 6 to 9 months | 4,6 | 19,9 |
| 9 to 12 months | 4,9 | 0.9 |
| At less than 1 year | 18,7 | 25.1 |
| At 2 years | 17.2 | 17,7 |
| At 3 years | 17,0 | 16,1 |
| At 4 years | 16.9 | 15.8 |
| At 5 years | 18,0 | 16,2 |
| 1 to 5 years | 69.1 | 65.9 |
| More than 5 years | 236.4 | 238.4 |
| Total lease liabilities and contractual fees on investment properties |
– 324,2 |
– 329.3 |
| (€ millions) | Cash flow |
|---|---|
| Issuance of borrowings and other financial liabilities | 1,564.2 |
| Repayment of borrowings and other financial liabilities | (1 914.8) |
| Change in borrowing and other financial liabilities | (350.6) |
| Repayment of lease liabilities | (17,8) |
| Change in cash balance | 338,4 |
| Total change in net financial debt (TFT) | (30,0) |
| Net bond and bank debt, excluding accrued interest and overdrafts | (216,5) |
| Net cash | 338,4 |
| Equity loans and Group and partners' advances | (134,1) |
| Lease liabilities | (2,3) |
| Contractual fees on investment properties | (15,5) |
| Total change in net financial debt | (30,0) |
| (€ millions) | 31/12/2021 | 31/12/2020 |
|---|---|---|
| Provision for benefits payable at retirement |
16,2 | 14.9 |
| Other provisions | 20.6 | 9,1 |
| Total provisions | 36,8 | 24,0 |
The provision for post-employment benefits was valued by an external actuary. The valuation and accounting principles are detailed in the Company's accounting principles and methods. The main assumptions used to assess the commitment are the staff turnover rate, the discount rate and the salary increase rate: a variation of +/- 0.25% of these last two criteria would not result in no significant impact.
| Investment properties | Total | ||||
|---|---|---|---|---|---|
| (€ millions) | Measured at fair value |
Measured at cost |
right-of-use | Assets held for sale |
Investment properties |
| As of 31 December 2020 | 3 649,0 | 211,1 | 164,6 | 77,4 | 4,102.0 |
| Subsequent investments and expenditures | 40.5 | 15.6 | – | – | 56.1 |
| Change in spread of incentives to buyers | 1,5 | – | – | – | 1,5 |
| Disposals/repayment of down payments made | (0,2) | (10.0) | – | – | (10,2) |
| Net impairment/project discontinuation | – | (4,8) | – | – | (4,8) |
| Transfers to assets held for sale or to or from other categories |
82.2 | (37.9) | – | (69.1) | (24.8) |
| New right-of-use assets and indexation | – | – | 6,6 | – | 6,6 |
| Change in fair value | 41,4 | – | (1,6) | – | 39,9 |
| Change in scope of consolidation | – | 18,7 | – | – | 18,7 |
| As of 31 December 2021 | 3 814,5 | 192,8 | 169,6 | 8,3 | 4 185.1 |
As of 31 December 2021, no interest expenses have been capitalised for projects under development and construction.
The main movements concern changes in fair value of shopping centres in operation.
The assets under development and under construction recognised at cost mainly concern the development and redevelopment projects of shopping centres in France.
During the first half of the year, the Group acquired a logistics asset located at 80-98 rue de Reuilly, in Paris. In the last quarter, the nature of the project concerning this asset was modified and the asset was transferred to inventory.
The Group reviewed all of its ongoing projects and recorded impairment charges where it deemed necessary.
The right-of-use assets on investment properties (measured at fair value) correspond to the valuation under IFRS 16 of the temporary occupancy authorisation contracts for investment properties.
The New right-of-use assets line includes the signing of an amendment to a Temporary Occupation Authorisation (AOT) agreement, as well as the indexation of existing contracts.
In accordance with IFRS 13 – "Fair Value Measurement" and the EPRA's recommendation on IFRS 13, "EPRA Position Paper on IFRS 13 – Fair Value Measurement and Illustrative Disclosures, February 2013", the Group chose to present additional parameters used to determine the fair value of its property portfolio.
The Altarea Cogedim Group considered that classifying its assets in level 3 was most appropriate. This treatment reflects the primarily unobservable nature of the data used in the assessments, such as rents from rental statements, capitalisation rates and average annual growth rate of rents. The tables below thus present a number of quantitative parameters used to determine the fair value of the property portfolio. These parameters apply only to shopping centres controlled exclusively by the Group (and therefore do not include assets accounted for under the equity method) and which are measured at fair value by the expert appraisers.
| Initial capitalisation rate |
Rent in € per m² | Discount rate | Capitalisation rate at exit |
AAGR of net rental income |
||
|---|---|---|---|---|---|---|
| a | b | c | d | e | ||
| France | Maximum | 10.0% | 679 | 8.1% | 7.0% | 4.5% |
| Minimum | 4.1% | 41 | 5.2% | 3.8% | 1.3% | |
| Weighted average | 5,1% | 403 | 6.4% | 5,1% | 3.0% | |
| – |
a - The initial capitalisation rate is the net rental income relative to the appraisal value excluding transfer duties.
b - Annual average rent (minimum guaranteed rent plus variable rent) per asset and m–.
c - Rate used to discount the future cash flow–.
d - Rate used to capitalise the revenue in the exit year in order to calculate the asset's exit value.
e - Average Annual Growth Rate of net rental income.
Based on a Group weighted average capitalisation rate, a +0.25% increase in capitalisation rates would lead to a reduction of -€143.6 million in the value of investment properties (-4.4%), while a -0.25% decrease in capitalisation rates would increase the value of investment properties by €193.7 million (+6.0%).
| (€ millions) | 31/12/2021 | 31/12/2020 |
|---|---|---|
| Regional shopping centres | 2,480.8 | 2,489.0 |
| Travel retail | 520.9 | 442.6 |
| Retail parks | 677.2 | 625.0 |
| Others | 135.5 | 92.4 |
| TOTAL | 3 814,5 | 3 649,0 |
| (€ millions) | Receivables on fixed assets |
Amounts due on non current assets |
Investment WCR |
|---|---|---|---|
| As of 31 December 2020 | 2,2 | (179.9) | (177.6) |
| Variations | (2,1) | 31,7 | 29,6 |
| Present value adjustment | – | – | – |
| Transfers | – | 3,5 | 3,5 |
| Change in scope of consolidation | – | 0.0 | 0.0 |
| As of 31 December 2021 | 0,2 | (144.7) | (144.5) |
| Change in WCR at 31 December 2021 | (2,1) | 31,7 | 29,6 |
| (€ millions) | 31/12/2021 | 31/12/2020 |
|---|---|---|
| Type of non-current assets acquired: | ||
| Intangible assets | (9.6) | (7.2) |
| Property, plant and equipment | (7.6) | (17,0) |
| Investment properties | (89.4) | (101.5) |
| Total | (106,6) | (125,7) |
| (€ millions) | Gross values | Amortisation and/or impairment |
31/12/2021 | 31/12/2020 |
|---|---|---|---|---|
| Goodwill | 449.9 | (240.6) | 209,4 | 209,4 |
| Brands | 105,4 | – | 105,4 | 105,4 |
| Customer relationships | 192.9 | (192.9) | – | – |
| Software applications, patents and similar rights | 62.2 | (44,9) | 17.3 | 15.3 |
| Leasehold right | 0,3 | (0.0) | 0,3 | 0,3 |
| Others | 0,1 | (0.0) | 0,1 | 0,1 |
| Other intangible assets | 62.6 | (44,9) | 17,7 | 15,7 |
| TOTAL | 810.8 | (478.4) | 332,5 | 330,4 |
| (€ millions) | 31/12/2021 | 31/12/2020 |
|---|---|---|
| Net values at beginning of the period | 330,4 | 331.4 |
| Acquisitions of intangible assets | 9,6 | 7,2 |
| Disposals and write-offs | (1,5) | (2,2) |
| Changes in scope of consolidation and other | – | 1,0 |
| Net allowances for depreciation | (6,1) | (6,9) |
| Net values at the end of the period | 332,5 | 330,4 |
Goodwill is mainly acquisitions of Cogedim, Pitch Promotion and Histoire & Patrimoine.
Impairment tests were carried out on the basis of business assumptions in light of economic for ecasts; these assumptions are based on the historical data on Property Development.
The main assumptions used to calculate the enterprise value are as f ollows:
At 31 December 2021, on the basis of these assumptions, the fair value of the economic assets in the Residential and Business property segments are greater than their net book value. No impairment needs to be recorded in the financial statements.
Sensitivity of +/-1% on the discount rate and of +/-0,5% on the perpetual growth rate, would lead to valuations of the economic assets for the Residential segment and the Business property segment which remain greater than their book value as at 31 December 2021.
The Group owns the following brands: Cogedim, Pitch Promotion, Histoire & Patrimoine and Severini. These brands, of a total value of €105.4 million, have an indefinite useful life and are thus not amortised.
The brands were tested and no impairment was recognised as of 31 December 2021.
| (€ millions) | Land and Constructi ons |
Vehicles | Others | Gross right of-use |
Amort. Land and Constructi ons |
Amort. Vehicles |
Amort. Others |
Amort. | Net right-of use |
|---|---|---|---|---|---|---|---|---|---|
| As of 31 December 2020 |
152,1 | 4,7 | 3.1 | 159.9 | (14,8) | (2,5) | (2,3) | (19,6) | 140,3 |
| New contracts/Increases | 4,5 | 2,0 | 0.0 | 6.5 | (14,8) | (1,3) | (0,7) | (16.9) | (10.4) |
| Contract terminations/Reversals |
(3.5) | (2,0) | (2.4) | (7.8) | 2,1 | 1,8 | 2,4 | 6,3 | (1,5) |
| As of 31 December 2021 |
153.2 | 4,7 | 0,8 | 158.7 | (27.6) | (2,0) | (0,6) | (30.3) | 128,4 |
Those Group companies having signed rental contracts within the scope of IFRS 16 – Leases, record as assets on the balance sheet, in the form of the right-of-use asset, all leases (mainly leases for premises used by Group employees, vehicle leasing) in exchange for a lease liabilities.
The term used corresponds to the fixed period of the commitment as well as to any optional periods for which there is a reasonable expectation of these being exercised.
| Flows | |||||
|---|---|---|---|---|---|
| (€ millions) | 31/12/2021 | 31/12/2020 | Created by the business |
Changes in consolidation scope and transfer |
Change in consolidation method |
| Net inventories and work in progress | 922,6 | 859,3 | 36,8 | 26,5 | – |
| Contract assets | 714,1 | 741,2 | (27.0) | (0,1) | – |
| Net trade receivables | 340,7 | 334,7 | 5.8 | 0,2 | – |
| Other operating receivables net | 517,4 | 491,1 | 22.4 | 3,8 | 0.0 |
| Trade and other operating receivables net | 858,0 | 825,8 | 28.2 | 4,0 | 0.0 |
| Contract liabilities | (168.1) | (177.3) | 9,2 | – | – |
| Trade payables | (1,008.6) | (1,094.4) | 92.5 | (6.8) | (0.0) |
| Other operating payables | (587.3) | (524.1) | (63.3) | 0,1 | 0.0 |
| Trade payables and other operating liabilities | (1,595.9) | (1,618.5) | 29.2 | (6.6) | 0.0 |
| Operational WCR | 730,6 | 630,4 | 76.5 | 23.7 | 0.0 |
The Group's operational working capital requirement (excluding receivables and payables on the sale or acquisition of fixed assets) is essentially linked to the Property Development business.
Changes in scope and transfers are mainly related to movements within the Retail business: transfers of assets from investment properties to inventories were made following changes in the nature of projects.
| (€ millions) | Gross inventories | Impairment | Net inventories | |
|---|---|---|---|---|
| At 1 January 2020 | 1,089.2 | (24.7) | 1,064.5 | |
| Change | (237,3) | 0.0 | (237,3) | |
| Increases | – | (6,7) | (6,7) | |
| Reversals | – | 9,7 | 9,7 | |
| Transfers to or from other categories | 20.0 | (0,1) | 19,9 | |
| Change in scope of consolidation | 9,1 | 0,1 | 9,2 | |
| As of 31 December 2020 | 881.0 | (21.7) | 859,3 | |
| Change | 31.6 | (0,3) | 31.3 | |
| Increases | – | (4,5) | (4,5) | |
| Reversals | – | 10,0 | 10,0 | |
| Transfers to or from other categories | 24.4 | (0,1) | 24,3 | |
| Change in scope of consolidation | 2,2 | (0.0) | 2,1 | |
| As of 31 December 2021 | 939.1 | (16.5) | 922,6 |
The change in inventories is mainly due to changes in the Group's Property Development business.
Changes in scope are mainly related to changes in scope within the Property Development business and asset transfers (investment properties to inventories) are due to changes in the nature of projects.
| (€ millions) | 31/12/2021 | 31/12/2020 |
|---|---|---|
| Gross trade receivables | 384,6 | 371.5 |
| Opening impairment | (36,8) | (23.5) |
| Increases | (31.5) | (17,0) |
| Change in scope of consolidation | – | (0,2) |
| Reversals | 24,3 | 3,7 |
| Other changes | 0.0 | 0,1 |
| Closing impairment | (43,9) | (36,8) |
| Net trade receivables | 340,7 | 334,7 |
| Advances and down payments paid | 43.1 | 41,4 |
| VAT receivables | 343.2 | 318.8 |
| Sundry debtors | 32.1 | 34,2 |
| Prepaid expenses | 52,9 | 65.1 |
| Principal accounts in debit | 47.1 | 32,8 |
| Total other operating receivables gross | 518.3 | 492.2 |
| Opening impairment | (1,1) | (2.9) |
| Increases | (0,2) | (0,3) |
| Reclassification | 0.0 | (0.0) |
| Reversals | 0,3 | 2,0 |
| Closing impairment | (1,0) | (1,1) |
| Net operating receivables | 517,4 | 491,1 |
| Trade receivables and other operating receivables | 858,0 | 825,8 |
| Receivables on sale of assets | 0,2 | 2,2 |
| Trade and other receivables | 858,2 | 828,0 |
| (€ millions) | 31/12/2021 |
|---|---|
| Total gross trade receivables | 384,6 |
| Impairment of trade receivables | (43,9) |
| Total net trade receivables | 340,7 |
| Trade accounts to be invoiced | (29.1) |
| Receivables lagging completion | (103.0) |
| Trade accounts receivable due | 208,5 |
| (€ millions) | Total | On time | At 30 days | At 60 days | At 90 days | More than 90 days |
|---|---|---|---|---|---|---|
| Trade accounts receivable due | 208,5 | 96.5 | 1,0 | 27.9 | 13.7 | 69.5 |
The Group carries out a case-by-case analysis to assess the credit risk of its tenants in centres in operation, and to write down, if necessary, the receivables of tenants where there is evidence that the Company will not be able to collect all amounts due.
In the context of the COVID-19 crisis, the Group has created a special monitoring process for trade receivables in the Retail business.
As of 31 December 2021, the change in net impairment of trade receivables is linked to the impact of COVID-19.
Receivables on off-plan sales (VEFA) are recorded inclusive of all taxes and represent revenues on a percentage-ofcompletion basis less receipts received from customers.
Advances and down payments correspond primarily to compensation for loss of use paid by the Group to the sellers of land when preliminary sales agreements are signed (for those not covered by guarantees) as part of its Property development business. They are offset against the price to be paid on completion of the purchase.
As part of its property management business and real estate transactions, the Group presents the cash balance it manages for third parties on its balance sheet.
| (€ millions) | 31/12/2021 | 31/12/2020 |
|---|---|---|
| Trade payables and related accounts | 1,008.6 | 1,094.4 |
| Advances and down payments received from clients | 23,4 | 36,8 |
| VAT collected | 321.8 | 300.7 |
| Other tax and social security payables | 63.6 | 43.7 |
| Prepaid income | 10,0 | 7,2 |
| Other payables | 121.4 | 102.9 |
| Principal accounts in credit | 47.2 | 32.9 |
| Other operating payables | 587.3 | 524.1 |
| Amounts due on non-current assets | 144.7 | 179.9 |
| Trade and other payables | 1 740,6 | 1 798,4 |
Payables on acquisition of assets correspond mainly to debts to suppliers for shopping centres just completed or under development.
The Group is exposed to the following risks as part of its operational and financing activities: interest rate risk, liquidity risk, counterparty risk and currency risk.
| Financial assets and liabilities carried at amortised Financial assets and liabilities carried at fair value cost |
|||||||||
|---|---|---|---|---|---|---|---|---|---|
| (€ millions) | Total carrying amount |
Non-financial assets |
Loans Receivables |
Liabilities at amortised cost |
Equity instruments |
Assets and liabilities at fair value through profit and loss |
Level 1 (a) | Level 2 (b) | Level 3 (c) |
| NON-CURRENT ASSETS | 481.4 | 148,8 | 328.1 | – | 4,5 | – | – | – | 4,5 |
| Securities and investments in equity affiliates | 459,4 | 148,8 | 310,6 | – | – | – | – | – | – |
| Non-current financial assets | 22,0 | – | 17,5 | – | 4,5 | – | – | – | 4,5 |
| CURRENT ASSETS | 2,524.1 | – | 2,461.8 | – | – | 62,3 | 50,3 | 12,0 | – |
| Trade and other receivables | 858,2 | – | 858,2 | – | – | – | – | – | – |
| Current assets | 28,3 | – | 28,3 | – | – | – | – | – | – |
| Derivative financial instruments | 12,0 | – | – | – | – | 12,0 | – | 12,0 | – |
| Cash and cash equivalents | 1 625,5 | – | 1 575,3 | – | – | 50,3 | 50,3 | – | – |
| NON-CURRENT LIABILITIES | 2 930,3 | – | – | 2 930,3 | – | – | – | – | – |
| Borrowings and financial liabilities | 2 891,7 | – | – | 2 891,7 | – | – | – | – | – |
| Deposits and security interests received | 38,7 | – | – | 38,7 | – | – | – | – | – |
| CURRENT LIABILITIES | 2,595.9 | – | – | 2,579.2 | – | 16,7 | – | 16,7 | – |
| Borrowings and financial liabilities | 838,5 | – | – | 838,5 | – | – | – | – | – |
| Derivative financial instruments | 16,7 | – | – | – | – | 16,7 | – | 16,7 | – |
| Trade and other payables | 1 740,6 | – | – | 1 740,6 | – | – | – | – | – |
(a) Financial instruments listed on an active market.
(b) Financial instruments whose fair value is determined using valuation techniques based on observable market inputs.
(c) Financial instruments whose fair value (in whole or in part) is based on non-observable inputs.
Equity instruments mainly comprise equity securities of non-consolidated companies. At each acquisition, an analysis is carried out to determine the Group's management intention, and therefore its accounting method (change in value through income or by OCI). Cash and cash equivalents breakdown between cash presented under receivables and marketable securities presented as financial assets within Level 1 of the fair value hierarchy.
48
| Financial assets and liabilities carried at amortised |
Financial assets and liabilities carried at fair value | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| (€ millions) | Total carrying amount |
Non-financial assets |
Loans Receivables |
cost Liabilities at amortised cost |
Equity instruments |
Assets and liabilities at fair value through profit and loss |
Level 1 (a) | Level 2 (b) | Level 3 (c) |
| NON-CURRENT ASSETS | 592.2 | 255,4 | 333.4 | – | 3,4 | – | – | – | 3,4 |
| Securities and investments in equity affiliates | 579,6 | 255,4 | 324,2 | – | – | – | – | – | – |
| Non-current financial assets | 12,6 | – | 9,2 | – | 3,4 | – | – | – | 3,4 |
| CURRENT ASSETS | 2 128.6 | – | 2,067.1 | – | – | 61.5 | 60,4 | 1,1 | – |
| Trade and other receivables | 828,0 | – | 828,0 | – | – | – | – | – | – |
| Current assets | 22,0 | – | 22,0 | – | – | – | – | – | – |
| Derivative financial instruments | 1,1 | – | – | – | – | 1,1 | – | 1,1 | – |
| Cash and cash equivalents | 1 277,5 | – | 1,217.1 | – | – | 60,4 | 60,4 | – | – |
| NON-CURRENT LIABILITIES | 2 536,8 | – | – | 2 536,8 | – | – | – | – | – |
| Borrowings and financial liabilities | 2 500,2 | – | – | 2 500,2 | – | – | – | – | – |
| Deposits and security interests received | 36,6 | – | – | 36,6 | – | – | – | – | – |
| CURRENT LIABILITIES | 3 404.5 | – | – | 3 368.2 | – | 36,3 | – | 36,3 | – |
| Borrowings and financial liabilities | 1 569,8 | – | – | 1 569,8 | – | – | – | – | – |
| Derivative financial instruments | 36,3 | – | – | – | – | 36,3 | – | 36,3 | – |
| Trade and other payables | 1 798,4 | – | – | 1 798,4 | – | – | – | – | – |
(a) Financial instruments listed on an active market.
(b) Financial instruments whose fair value is determined using valuation techniques based on observable market inputs.
(c) Financial instruments whose fair value (in whole or in part) is based on non-observable inputs.
Equity instruments mainly comprise equity securities of non-consolidated companies. At each acquisition, an analysis is carried out to determine the Group's management intention, and therefore its accounting method (change in value through income or by OCI).
Cash and cash equivalents breakdown between cash presented under receivables and marketable securities presented as financial assets within Level 1 of the fair value hierarchy.
The Group holds a portfolio of swaps and caps designed to hedge against interest rate risk on its financial debts.
The Group mainly uses credit markets. The increasing use of fixed-coupon bonds has changed the hedging strategy in recent years.
In December 2021, the Group executed a €525 million rate swap program in anticipation of the increase in the debt volume.
The Group has not opted for the hedge accounting available under IFRS 9. Derivatives are carried at fair value.
In compliance with IFRS 13, these instruments are measured by considering the credit valuation adjustment (CVA) when positive, and the debit valuation adjustment (DVA) when negative. This adjustment measures, by application on each cash flow date of the valuation of a probability of default, the counterparty risk defined as an obligation to replace a hedging operation at the market rate in force following the default by one of the counterparties. CVA, calculated for a given counterparty, considers the probability of default for this counterparty. DVA, based on the Company's credit risk, corresponds to the counterparty's exposure to loss in the event of the Company's default. The change in fair value of derivative financial instruments has no significant impact on the net result of the period.
| (€ millions) | 31/12/2021 | 31/12/2020 |
|---|---|---|
| Interest-rate swaps | (16.6) | (30.2) |
| Interest-rate caps | 4,9 | – |
| Accrued interest not yet due | 7.1 | 0,5 |
| Premiums and balances outstanding | – | (5.5) |
| Total | (4,7) | (35.2) |
Derivatives were valued by discounting future cash flows estimated according to interest rate curves at 31 December 2021.
| (€ millions) | 31/12/2021 | 31/12/2022 | 31/12/2023 | 31/12/2024 | 31/12/2025 | 31/12/2026 |
|---|---|---|---|---|---|---|
| ALTAREA – pay fixed – swap | 500,0 | 500,0 | 1 025,0 | 1 025,0 | 525,0 | 525,0 |
| ALTAREA – pay floating rate – swap | 700,0 | 700,0 | 700,0 | 300,0 | 300,0 | – |
| ALTAREA– cap | 262,5 | 262,5 | 262,5 | 262,5 | 262,5 | 262,5 |
| Total | 1 462,5 | 1 462,5 | 1 987,5 | 1 587,5 | 1 087,5 | 787,5 |
| Average hedge ratio | 0,19% | 0,19% | 0.17% | 0.13% | (0.30)% | 0.10% |
| (€ millions) | 31/12/2020 | 31/12/2021 | 31/12/2022 | 31/12/2023 | 31/12/2024 | 31/12/2025 |
|---|---|---|---|---|---|---|
| ALTAREA – pay fixed – swap | 750.0 | 500,0 | 500,0 | 500,0 | 500,0 | – |
| ALTAREA – pay floating rate – swap | 400,0 | 400,0 | 400,0 | 400,0 | – | – |
| ALTAREA– cap | 75,0 | – | – | – | – | – |
| Total | 1 225,0 | 900,0 | 900,0 | 900,0 | 500,0 | – |
| Average hedge ratio | 0,35% | 0,35% | 0,35% | 0,35% | 0.31% | 0.00% |
| (€ millions) | 31/12/2021 | 31/12/2022 | 31/12/2023 | 31/12/2024 | 31/12/2025 | 31/12/2026 |
|---|---|---|---|---|---|---|
| Fixed-rate bond and bank loans | (1,749.3) | (1,722.9) | (1722.8) | (1,337.2) | (837.1) | (787.0) |
| Floating-rate bank loans | (1,521.9) | (803.6) | (594.5) | (438.4) | (398.3) | (342.3) |
| Cash and cash equivalents (assets) | 1 625,5 | – | – | – | – | – |
| Net position before hedging | (1,645.6) | (2,526.5) | (2,317.4) | (1,775.6) | (1,235.4) | (1,129.3) |
| Swap | 1 200,0 | 1 200,0 | 1,725.0 | 1,325.0 | 825.0 | 525,0 |
| Cap | 262,5 | 262,5 | 262,5 | 262,5 | 262,5 | 262,5 |
| Total derivative financial instruments | 1 462,5 | 1 462,5 | 1 987,5 | 1 587,5 | 1 087,5 | 787,5 |
| Net position after hedging | (183.1) | (1064.0) | (329.9) | (188.1) | (147.9) | (341.8) |
| (€ millions) | 31/12/2020 | 31/12/2021 | 31/12/2022 | 31/12/2023 | 31/12/2024 | 31/12/2025 |
|---|---|---|---|---|---|---|
| Fixed-rate bond and bank loans | (1 974.9) | (1,720.3) | (1720.2) | (1,720.1) | (1,334.5) | (834.4) |
| Floating-rate bank loans | (1,495.2) | (404.1) | (251.2) | (127.1) | (61.1) | (21.3) |
| Cash and cash equivalents (assets) | 1 277,5 | – | – | – | – | – |
| Net position before hedging | (2192.6) | (2,124.4) | (1 971.4) | (1847.2) | (1395.6) | (855,6) |
| Swap | 1,150.0 | 900,0 | 900,0 | 900,0 | 500,0 | – |
| Cap | 75,0 | – | – | – | – | – |
| Total derivative financial instruments | 1 225,0 | 900,0 | 900,0 | 900,0 | 500,0 | – |
| Net position after hedging | (967.6) | (1,224.4) | (1,071.4) | (947.2) | (895.6) | (855,6) |
The following table shows the interest-rate sensitivity (including the effect of hedging instruments) of the entire portfolio of floatingrate borrowings from credit institutions and derivative instruments.
| Increase/decrease in | Impact of the gain (-) or loss (+) on | Impact on the value of the portfolio of | |
|---|---|---|---|
| interest rates | pre-tax | the financial instruments | |
| 31/12/2021 | +50 bps | +€2.5 million | +€16.0 million |
| -50 bps | -€2.3 million | -€15.9 million | |
| 31/12/2020 | +50 bps | +€1.3 million | +€6.3 million |
| -50 bps | -€1.6 million | -€6.5 million |
The Group had a positive cash position of €1,625.5 million at 31 December 2021, compared to €1,277.5 million at 31 December 2020. This represents its main tool for management of liquidity risk (see Note 6.2.1 "Net financial bond and bank debt").
Part of this cash is available for the subsidiaries that carry it: as of 31 December 2021, this cash amounted to €553.3 million.
On this date, €1,072.2 million in cash is available at Group level. The Group also has €1,159 million of additional available cash and cash equivalents (in committed corporate credit facilities unused and not assigned to projects).
The covenants with which the Group must comply concern the listed corporate bond and banking loans, for €1,515 million.
The bond issue subscribed for by Altareit SCA (€500 million) is subject to leverage covenants.
| Altarea Group covenants |
31/12/2021 | Consolidated Altareit covenants |
31/12/2021 | |
|---|---|---|---|---|
| Loan To Value (LTV) | ||||
| Net bond and bank financial debt/re-assessed value of the Company's assets | <60% | 24.1% | ||
| Interest Cover Ratio (ICR) | ||||
| Operating income (FFO column or cash flow from operations)/Company's net borrowing cost (FFO column) |
> 2 | 8.2 | ||
| Leverage | ||||
| Gearing: Net financial debt/Equity | ≤ 3.25 | (0,1) | ||
| ICR: EBITDA/Net interest expenses | ≥ 2 | 9.9 |
The covenants specific to mortgage loans to finance shopping centres in operation:
At 31 December 2021, the Company met all its covenants. In the highly likely event that certain mortgage debt may be required to be partially repaid at a subsequent date, the amount of these repayments would be recognised under current liabilities until the maturity date.
The use of derivatives to limit interest-rate risk exposes the Group to a possible default by a counterparty. The Group mitigates this risk by selecting only major financial institutions as counterparties in hedging transactions.
Because the Company operates exclusively in the euro zone, it has not entered into any currency hedges.
Ownership of the Company's shares and voting rights is as follows:
| 31/12/2021 | 31/12/2021 | 31/12/2020 | 31/12/2020 | |
|---|---|---|---|---|
| As a percentage | % share capital | % voting rights | % share capital | % voting rights |
| Founding shareholders and the expanded | 44.93 | 45.39 | 45.85 | 46.22 |
| concert party (a) Crédit Agricole Assurances |
24.66 | 24.91 | 24.74 | 24.94 |
| ABP | 7.09 | 7.16 | 8.27 | 8.34 |
| Opus Investment BV (b) | 1.62 | 1.64 | 1.49 | 1.50 |
| Treasury shares | 1.01 | – | 0.81 | – |
| Public + employee investment mutual fund | 20.69 | 20.90 | 18.84 | 19.00 |
| Total | 100.00 | 100.00 | 100.00 | 100.00 |
(a) The founding shareholders, Alain Taravella and his family, Jacques Nicolet and the CEO of Altafi 2, Jacques Ehrmann, acting in concert. (b) And related parties.
The main related parties are the companies of one of the founding shareholders that own a stake in Altarea:
The Company is managed by Alain Taravella personally and by the companies Altafi 2 and Atlas which he controls. Alain Taravella is also Chairman of Altafi 2 and Atlas. Jacques Ehrmann is Chief Executive Officer of Altafi 2.
Transactions with these related parties mainly relate to services rendered by the aforementioned Management and to a lesser extent, services and rebillings by the Company to AltaGroupe and its subsidiaries.
In order to formalise the services habitually provided to Altarea by AltaGroupe, the coordinating holding Company, and to spell out the services provided by the latter, a coordination agreement was signed in 2017. The previous conditions remain unchanged.
Assistance services and rebilling of rents and other items are recognised as a deduction from other company overhead costs in the amount of €0.2 million. Services invoiced to related parties by the Altarea Group are invoiced on an arm's length basis.
| Altafi 2 SAS | |||
|---|---|---|---|
| (€ millions) | 31/12/2021 | 31/12/2020 | |
| Trade and other receivables | 0.1 | 0.0 | |
| TOTAL ASSETS | 0.1 | 0.0 | |
| Trade and other payables (a) | 1.0 | 0.0 | |
| TOTAL LIABILITIES | 1.0 | 0.0 |
In addition, new management fee agreements were set up in 2021 to remunerate the services provided by Altarea, Altareit and Altarea Management for the benefit of Group companies. The remuneration of these management fees has been defined by mutual agreement according to the cost of the services provided, in line with the market price.
Alain Taravella does not personally receive any compensation from Altarea or its subsidiaries for his comanagement position. In fact, it is entirely paid to the company Altafi 2. Alain Taravella receives compensation from a holding company which has a stake in Altarea.
No share-based compensation or other short-term or longterm or other forms of compensation were paid by Altarea or its subsidiaries to the Management.
The fixed remuneration of Management in respect of Altarea and Altareit is €2 million for the year.
The variable Management compensation is calculated in proportion to net income (FFO), Group share, and with the Company's GRESB rating for Altarea, and in proportion to net income, Group share, for Altareit.
It stood at €1.2 million at 31 December 2021.
| (€ millions) | 31/12/2021 | 31/12/2020 |
|---|---|---|
| Gross wages (a) | 4,0 | 4.2 |
| Social security contributions | 1,7 | 1,6 |
| Share-based payments (b) | 7,5 | 4,1 |
| Number of shares delivered during the period |
34 293 | 6 963 |
| Post-employment benefits (c) | 0.0 | 0.0 |
| Other short- or long-term benefits and compensation (d) |
0.0 | 0.0 |
| Termination indemnities (e) | – | 0.0 |
| Employer contribution on free shares delivered |
1,1 | 0,2 |
| Post-employment benefit commitment | 0,8 | 0,3 |
(a) Fixed and variable compensation.
(b) Charge calculated in accordance with IFRS 2.
(c) Pension service cost according to IAS 19, life insurance and medical care.
(d) Benefits in kind, directors' fees and other compensation vested but payable in the future (short- or long-term).
(e) Post-employment benefits, including social security costs.
| In number of rights on equity in circulation | 31/12/2021 | 31/12/2020 |
|---|---|---|
| Rights to Altarea SCA's free shares grants |
159 603 | 67 603 |
The information presented relates to the compensation and benefits granted (i) to executive corporate officers for offices held in subsidiaries and (ii) to the Group's main salaried executives.
The main commitments given by the Group are mortgages and mortgage commitments made to secure loans or lines of credit from credit institutions.
Pledges of securities and undertakings not to sell or assign ownership units are also made by the Company to secure certain loans.
These commitments appear in Note 6.2 "Net financial debt and guarantees".
In addition, the Company has received commitments from banks for unused credit lines, which are described in Note 8.3 "Liquidity risk".
All other material commitments are set out below:
| (€ millions) | 31/12/2020 | 31/12/2021 | Less than one year |
From one to five years |
More than five years |
|---|---|---|---|---|---|
| Commitments received | |||||
| Commitments received relating to financing (excl. borrowings) | – | – | – | – | – |
| Commitments received relating to Company acquisitions | 9,6 | 10,6 | 1,0 | 4,1 | 5.5 |
| Commitments received relating to operating activities | 165.3 | 168.4 | 100.6 | 51.3 | 16.5 |
| Security deposits received in the context of the Hoguet Act (France) | 87,9 | 87,9 | 87,9 | – | – |
| Security deposits received from tenants | 20.4 | 23.9 | 0,3 | 8,6 | 15.0 |
| Payment guarantees received from customers | 44,6 | 44,6 | 0,4 | 42.7 | 1,5 |
| Unilateral land sale undertakings received and other commitments | 0,3 | 0,3 | 0,3 | – | – |
| Other commitments received relating to operating activities | 12.2 | 11,8 | 11,8 | – | – |
| Total | 174.8 | 178,9 | 101.6 | 55.4 | 22,0 |
| Commitments given | |||||
| Commitments given relating to financing (excl. borrowings) | 11,0 | 11,0 | 5.0 | 6,0 | – |
| Commitments given relating to Company acquisitions | 73.4 | 68.7 | 1,8 | 66.9 | – |
| Commitments given relating to operating activities | 2 306.7 | 2,213.9 | 972.5 | 1 203.8 | 37,5 |
| Construction work completion guarantees (given) | 1,965.7 | 1,928.0 | 838.4 | 1,085.8 | 3,9 |
| Guarantees given on forward payments for assets | 235.8 | 170,8 | 93.6 | 77.1 | – |
| Guarantees for loss of use | 51.0 | 61.1 | 38.8 | 19,9 | 2,4 |
| Other sureties and guarantees granted | 54,3 | 54.0 | 1,8 | 21,0 | 31.2 |
| Total | 2,391.2 | 2 293.6 | 979.3 | 1 276.7 | 37,5 |
As part of its acquisition of the developer Severini, the Group received a commitment from the sellers to guarantee it until 31 January 2025 against any damage or loss up to €2 million, incurred by the Group as a result of the business activities, with a cause or origin predating 31 March 2018.
The Group and Woodeum Holding arranged a potential liquidity of their securities and secured the Group's ability to buy the balance of the shares not held, should it so wish. The Group has moreover received representations and warranties in the context of this investment.
In compliance with the "Hoguet Act", the Group holds security deposits received from specialist bodies in an amount of €87.9 million as a guarantee covering its property management and trading activities.
The Group also receives security deposits from its tenants to guarantee that they will pay their rent.
The Group receives customer payment guarantees issued by financial institutions to guarantee sums payable by the customer. They mainly relate to Retail and Office property development projects.
Other guarantees received consist mainly of commitments received from property sellers.
In its Property Development business, the Group receives deposits on construction contracts from contractors to cover holdbacks (up to 5% of the amount of the contract – noncosted commitment).
In addition, the Group has secured a syndicated loan of €800 million with a pool of partner banks, which will be drawn down on the day of the Primonial acquisition.
The Group makes representations and warranties or contingent consideration when disposing of shares in subsidiaries and affiliates. When the Group considers that it is probable that there will be a cash outlay under the terms of these guarantees, it sets aside allowances to provisions and their amount is re-assessed at each closing date.
The main commitments concern:
The shares of Altablue, Aldeta, Alta Crp Gennevilliers, Alta Crp La Valette, Alta Gramont, Toulouse Gramont, Bercy Village and Société d'Aménagement de la Gare de l'Est as well as assets held by these companies, are for a limited period subject to conditions for sale contingent on the agreement of each of the partners of these companies.
As part of the Crédit Agricole Assurances agreements, the Group has signed a certain number of legal undertakings that restrict the liquidity of its shareholding under certain conditions.
Completion guarantees are given to customers as part of offplan sales and are provided on behalf of Group companies by financial institutions, mutual guarantee organisations or insurance companies. They are reported in the amount of risk borne by the financial institution that issued the guarantee.
In return, Group companies give financial institutions a promise of mortgage security and an undertaking not to sell ownership units.
These guarantees mainly cover purchases of land or buildings for the Property Development business.
As part of its Property Development activities, the Group signs preliminary sales agreements with landowners, the execution of which is subject to conditions precedent, including conditions relating to obtaining administrative authorisations. In return for their undertakings, landowners receive compensation for loss of use, which takes the form of an advance (carried on the asset side of the balance sheet) or a surety (an off-balance sheet liability). The Group undertakes to pay the compensation for loss of use if it decides not to buy the land when the conditions precedent are met.
The other sureties and guarantees granted relate primarily to the Group's involvement in AltaFund, the office property investment fund, the sureties granted in connection with its property development activity, as well as the REIT business in Italy for guarantees granted by companies to the Italian government regarding their VAT position.
Notably in the ordinary course of its Property Development activities, the Group enters into reciprocal commitments to ensure the REIT control of future projects. The Group signs bilateral sales agreements with landowners: the owner undertakes to sell its land and the Group commits to buy it if all conditions precedent (administrative and/or marketing) are met.
In the conduct of its proprietary shopping centre development business, Altarea has made commitments to invest in projects initiated and controlled by the Company.
Moreover, in the conduct of its Residential property development, the Group signs reservation contracts (or preliminary sales agreements) with its customers, the execution of which depends on whether the customers meet the conditions precedent, particularly with respect to their ability to secure financing.
As part of its Property Development business, the Group has a future offering consisting of unilateral preliminary sales agreements.
The amount of these commitments is shown in the business review.
The total of minimum future rents to be received under noncancellable rental agreements over the period amounted to:
| (€ millions) | 31/12/2021 | 31/12/2020 |
|---|---|---|
| Less than one year | 193.4 | 124.0 |
| Between 1 and 5 years | 489.4 | 214.3 |
| More than 5 years | 225.6 | 169.1 |
| Guaranteed minimum rent | 908.4 | 507.4 |
Rents receivable relate mainly to shopping centres owned by the Group.
A rectification proposal regarding the registration fees related to the sale by Alta Faubourg of Semmaris shares in 2018 was received. As registration fees are guaranteed by Alta Faubourg, the risk, which amounts to €9.4 million in fees and late payment penalties, is borne by the Group. The company has strong arguments to contest the adjustment and does not envisage an outflow of financial resources. No provision was therefore taken at 31 December 2021.
No other new litigation or governmental, legal, or arbitration proceedings that are likely to have significant effects on the Company's financial position or profitability arose in the period, other than those for which a provision has been recognised (see Note 6.3 "Provisions") or that have been effectively challenged or are being challenged by the Company (see Note 5.3 "Corporate income tax" or 6.3 "Provisions").
The Group signed a partnership agreement with Crédit Agricole Assurances for the creation of the Alta Infrastructure fund, which covers the shops at the Paris-Montparnasse station and five Italian stations owned by Altarea.
| (€ millions) | E&Y | Grant Thornton | Others | Total | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Amount | % | Amount | % | Amount | % | Amount | % | |||||||||
| 2021 | 2020 | 2021 | 2020 | 2021 | 2020 | 2021 | 2020 | 2021 | 2020 | 2021 | 2020 | 2021 | 2020 | 2021 | 2020 | |
| Statutory audit, certification, examination of individual and consolidated financial statements | ||||||||||||||||
| - Altarea SCA | 0.3 | 0.3 | 15% | 19% | 0.3 | 0,3 | 27% | 37% | – | – | 0% | 0% | 0.6 | 0.6 | 18% | 22% |
| - Fully consolidated subsidiaries |
1.3 | 1.1 | 56% | 74% | 0,4 | 0,5 | 36% | 59% | 0.1 | 0.3 | 100% | 100% | 1.7 | 1.9 | 51% | 73% |
| Services other than the certification of the financial statements | ||||||||||||||||
| - Altarea SCA | 0.4 | 0.0 | 16% | 0% | 0.4 | 0.0 | 37% | 0% | – | – | 0% | 0% | 0.8 | 0.0 | 22% | 0% |
| - Fully consolidated subsidiaries |
0.3 | 0.1 | 13% | 6% | 0.0 | 0.0 | 0% | 3% | (0.0) | 0.0 | 0% | 0% | 0.3 | 0.1 | 9% | 5% |
| Total | 2.3 | 1,5 | 100% | 100% | 1.1 | 0,8 | 100% | 100% | 0.1 | 0.3 | 100% | 100% | 3.4 | 2.6 | 100% | 100% |
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