Deutsche EuroShop AG — Call Transcript 2013

Mar 22, 2013

CONFERENCE CALL FY2012 Preliminary Results

22.03.2013

FY 2012

COMPANY

Highlights 2012

January

Increase of the shareholdings to 100% in

• Rhein-Neckar-Zentrum (investment volume: €0.24 million),
• Allee-Center Hamm (investment volume €8.8 million)
• Rathaus-Center Dessau (investment volume €5.9 million)

Highlights 2012

November

Acquisition of Herold-Center, Norderstedt (investment volume: €187 million)

Placement of 2,314,136 new shares from an increase in the share capital with institutional investors (proceeds of approx. €67.7 million)

Convertible bonds with a maturity of five years and a total principal amount of €100 million were placed with qualified investors

3

Herold-Center

SHOPPING CENTER SHARE

Highlights 2012

DES:	+32.7%
MDAX:	+33.9%
	EPRA: +29.2%

Index ranking MDAX Feb 2013: 24. (Market Cap) 37. (Turnover)

SHOPPING CENTERS

Tenants Structure Top 10 Tenants*

	2012	2011
Metro Group	5.7%	6.0%
Douglas Group	4.6%	4.4%
H&M	2.9%	2.7%
New Yorker	2.2%	2.3%
Peek & Cloppenburg	2.1%	1.9%
Deichmann	1.9%	1.9%
C&A	1.8%	1.7%
REWE	1.7%	1.6%
Esprit	1.5%	1.4%
Inditex Group	1.5%	1.4%
Total	25.9%	25.3%

Low level of dependence on the top 10 tenants

^* in % of total rents as at 31 December 2012

DES Shoppingcenter GmbH & Co. KG

• Buyer of Herold-Center Norderstedt in November 2012
• 6 SPV´s were merged into DES Shoppingcenter KG in late December 2012
• Total assets of €1,143.9 million
• Equity of €513.1 million
• Deferred taxes of €48.5 million
• Bank debt €548.8 million
• Other debt €33.5 million
• One off costs approx. €6.5 million (taxes €6.2 million)
• On average expected 5 years cash tax effect of €-3.3 million p.a.

Balance Sheet

in € thousand	31.12.2012	31.12.2011	Change
Non-current assets	3,365,135	3,139,777	225,358
Current assets	183,719	85,348	98,371
Total assets	3,548,854	3,225,125	323,729
Group equity	1,323,336	1,193,041	130,295
Non controlling interest	284,176	280,078	4,098
Total equity	1,607,512	1,473,119	134,393
Financial liabilieties	1,657,234	1,472,149	185,085
Deferred tax liabilities	179,103	210,587	-31,484
Other liabilities	105,005	69,270	35,735
Total equity and liabilities	3,548,854	3,225,125	323,729

Valuation – Investment Properties 2012

FINANCIALS

in € thousand	2012	2011	Change
Revaluation	31,080	54,300	-23,220
IFRS 3	3,990	7,900	-3,910
Acquisition expenses	-9,198	-8,500	-698
Minority interest	-18,675	-11,900	-6,775
Valuation result before taxes	7,197	41,800	-34,603
Deferred taxes	-5,340	-10,000	+4,660
Valuation result after taxes (attributable to Group shareholders)	1,857	31,800	-29,943

like-for-like measurement gains: +0.6%

Valuation* – Investment Properties 2012

Discounted	cash-flow	method	2012	2011	actual
	expected yield of 10-year					Macro-location		40.0%
German federal bonds			4.30%	4.34%	1.38%1)		Competitive environment	12.8%
	average applied risk premiums		2.37%	2.34%		Micro-location		19.2%
average discount rate			6.67%	6.68%		Property quality		8.0%
	average property operating					Tenants risk		20.0%
	and management costs		11.00%	11.80%
net initial	yield (EPRA)		5.98%	5.92%
% 6.56	6.54			6.68	6.80	6.65	6.68	6.67
		6.44	6.38
				5.64	5.82	5.89	5.92
5.48	5.46	5.39	5.40					5.98
2004	2005	2006	2007	2008	2009	2010	2011	2012
			discount rate		net initial yield

* = External appraisers: Feri Research and GfK GeoMarketing

12

1) Status: 18 March 2013

Sensitivity analysis

in € thousand	Basis	change of -25bps	change of +25bps
Rent increase rates	1.70%	-110,200	+113,000
Discount rate	6.67%	+101,900	-97,000
Net initial yield	5.98%	+146,400	-134,500
Cost ratio	11.00%	+9,500	-9,500

Net Asset Value (EPRA)

in € thousand	2012 2011					Change**
	total	per share	total	per share
Equity	1,323,337	€24.53	1,193,041	€23.11	10.9%
deferred taxes	179,103	€3.32	210,586	€4.08	-15.0%
NAV DES	1,502,440	€27.85	1,403,628	€27.19	7.0%
Fair value of Swaps	48,788	€0.90	35,028	€0.68
deferred taxes	-13,047	€-0.24	-11,367	€-0.22
NAV EPRA	1,538,180	€28.51	1,427,289	€27.64	7.8%
Number of shares	53,945,536		51,631,400		4.5%

2011		Change *
total	per share
,041	€23.11	10.9%
,586	€4.08	$-15.0$
,628	€27.19	$7.0$ o
,028	€0.68
,367	$€-0.22$
,289	€27.64	7.8 °
,400		$4.5^{\circ}$

NUMBER OF SHARES

NAV PER SHARE

* = EPRA NAV

13

** = of total amount

Loan Structure incl. Convertible Bonds*

Interest lockin	Duration	Principle amounts (€ thousand)	Share of total loan	avg. interest rate
Up to 1 year		171.3	11%	2.93%
1 to 5 years	3.7	545.7	33%	4.74%
5 to 10 years	8.3	744.6	45%	4.32%
Over 10 years	14.6	187.7	11%	5.05%
Total 2012	6.3	1,649.3	100%	4.16%

• 22 German and 1 Austrian
• Weighted maturity of fixed interest periods 6.3 years
• Weighted maturity of the loans >11 years

Refinancings of 2012

in € thousand	new	old	+/-
Principle amounts	104,322	104,320	+0,002
Duration	10.0yrs	2.0yrs	+8.0yrs
Interest rate	3.02%	5.83%	-2.81%

Maturities until 2017*

in € thousand	end of fixed interest periods respectively expiring loans	avg. interest rate	regular redemption payments	total maturities
2013	196,000	3.88%	19,800	216,000
2014	12,000	5.07%	20,900	33,000
2015	78,600	5.06%	19,600	98,000
2016	173,000	5.43%	16,200	189,000
2017	100,000	1.75%	16,600	117,000
	559,600

thereof 220,000 already refinanced

* = as of 31 Dec. 2012

16

Profit and Loss Account

FINANCIALS

in € thousand	01.01 – 31.12.2012	01.01 – 31.12.2011	Change
Revenue	211,231	189,975	11%
Property operating and management costs	-21,803	-18,333
Net operating income	189,428	171,642	10%
Other operating income	2,905	1,010
Corporate costs	-11,316	-6,991
EBIT	181,017	165,661	9%
Income from investments	1,400	1,261
Net interest expense	-70,690	-64,899
At equity valuation	-589	270
Profit/loss attributable to limited partners	--15,271	--15,730
Net finance costs	-85,150	-79,098	-8%
Measurement gains/losses	7,197	47,453
EBT	103,064	134,016	-23%
Taxes	20,145	-34,978
Consolidated profit	123,209	99,038	24%

* = The sum of the earnings per share amounts may not equal the totals due to rounding.

21

	2012	per share*	2011	per share*
Consolidated net profit	123,209	€2.37	99,038	€1.92
- IAS 40 valuation	-7,197	€-0.13	-47,453	€-0.92
- At-equity valuation	0	€0.00	-94	€0.00
+ Deferred taxes	5,341	€0.10	10,008	€0.19
+ Tax expense for previous years	-49,323	€-0.95	0,00	€0.00
EPRA Earnings	72,029	€1.39	61500	€1.19
Number of shares (adj.)	51,934,893		51,631,400

Earnings per Share (EPRA)

FINANCIALS

• 1) = The sum of the earnings per share amounts may not equal the totals due to rounding.
• 2) = Compound Annual Growth Rate (CAGR)

Funds from Operations (FFO)

FINANCIALS

	2012	per share1)	2011	per share1)
Consolidated net profit	123,209	€2.37	99,038	€1.92
- IAS 40 valuation	-7,197	€-0.13	-47,453	€-0.92
- At-equity valuation	-2	€0.00	-94	€0.00
+ Deferred taxes	-28,734	€-0.56	31,606	€0.61
FFO	87,276	€1.68	83,097	€1.61
Number of shares (adj.)	51,934,893		51,631,400

SHOPPING CENTER SHARE

Dividend & Performance

PERFORMANCE4)

		DES	DAX	EPRA5)	REX6)
1 year	(2012)	+32.7%	+29.1%	+29.2%	+4.6%
3 years	+51.2% =	+14.8% p.a.	+8.5% p.a.	+11.6% p.a.	+5.6% p.a.
5 years	+66.6% =	+10.7% p.a.	-1.2% p.a.	-0.8% p.a.	+6.4% p.a.
Since IPO (2001)	+171.8%=	+8.7% p.a.	+1.4% p.a.	+6.6% p.a.	+5.3% p.a.

• 1) respectively paid for the previous financial year
• 2) 2013: as of 19 March 2013

• 3) at minimum

• 4) as of 31 December 2012

• 5) EPRA/NAREIT Europe
• 6) German government bonds index

COMPANY

Outlook

• At-equity consolidation
• Deconsolidation of
• Altmarkt-Galerie Dresden
• Allee-Center Magdeburg
• City-Arkaden Klagenfurt
• Árkád Pécs
• Phoenix-Center Hamburg
• Stadt-Galerie Passau
• Total assets down €-389.5 million to €3,159.3 million
• Equity ratio (incl. minorities) moves up from 45.3% to 48.4%
• Turnover down by €-54.2 million to €157.1 million
• EBIT down by €-49.1 million to €132.3 million

COMPANY

Outlook

• Investments of €15 million for restructurings in 2013
• No further refinancings in 2013
• New acquisitions?
• Further optimisation of tax structure?
• Further increase in dividend

Retail turnover 2012*

Retail sector	% change in 2012	rent-to-sales ratio in %	% of sales	% of space
Department stores	1.4	6.1	9.0	15.8
Food	1.4	6.5	9.8	6.3
Fashion textiles	-0.6	11.1	27.1	34.4
Shoes & leather goods	-1.0	13.5	5.2	6.3
Sports	2.8	8.5	4.2	4.8
Health & Beauty	4.0	7.2	10.4	5.6
General Retail	-2.7	10.2	10.7	11.8
Electronics	-2.0	2.8	15.2	9.5
Services	3.1	4.6	4.4	1.5
Food catering	0.4	13.4	4.0	4.0
Total	0.1	8.3	100.0	100.0

• * German centers on a like-for-like basis (turnover: €1.7 billion)

• ** compares to a turnover development of +1.9% of the overall German retail

• retail turnover development abroad on a like-for-like basis: +1.0% DES-Portfolio overall: +0.2%

• absolute turnover development: Germany +5.2%**, Abroad +2.4% DES-Portfolio overall: +4.7%

APPENDIX

Correction*

The German Federal Financial Supervisory Authority (BaFin) determined that the consolidated financial statements of Deutsche EuroShop AG with the reporting date 31 December 2011 are incorrect:

1. The item "Measurement gain/loss" indicated in the consolidated income statement was €8.3 million too low because merger-related expenses connected to the acquisition of the Billstedt-Center Hamburg which should have been recognised in financial year 2010 were erroneously recognised in financial year 2011.

This is a violation of IFRS 3.53, which states that the acquirer must recognise all costs associated with a business combination as an expense during the periods in which they were incurred.

1. In the 2011 consolidated financial statements, cash inflows in the amount of €155.2 million are recognised in cash flow from operating activities and cash outflows of the same amount are recognised in cash flow from investment activities, both in connection with the acquisition of the Billstedt-Center Hamburg, yet no cash inflows or outflows in this amount actually took place during the period.

This is a violation of IAS 7.10, which specifies that the statement of cash flows must only include actual cash flows from the reporting period.

* Publication pursuant to Section 37q (2) (1) of the Wertpapierhandelsgesetz (WpHG - German Securities Trading Act)

29

Key Data of the Share

APPENDIX

Listed since	02.01.2001
Nominal capital	€53,945,536.00
Outstanding shares	53,945,536
Class of shares	Registered shares
Dividend 2012 (21.06.2013)	€1.xx
52W High	€32.45
52W Low	€25.36
Share price (20.03.2013)	€30.77
Market capitalisation	€1.66 billion
avg. turnover per day last 12 months (XETRA)	128,200 shares
Indices	MDAX, EPRA, GPR, MSCI Small Cap, EURO STOXX, STOXX Europe 600
Official market	Prime Standard Frankfurt and XETRA
OTC market	Berlin-Bremen, Dusseldorf, Hamburg, Hanover, Munich and Stuttgart
ISIN	DE 000 748 020 4
Ticker	DEQ, Reuters: DEQGn.DE
Market maker	Close Brothers Seydler

APPENDIX

Financial Calendar

2013

21.03.	Preliminary Results FY 2012
27.03.	Roadshow London, Bankhaus Metzler
27.03.	Roadshow Geneva, Berenberg
11.-12.04.	Lampe Deutschland Conference, Baden-Baden
26.04.	Publication of the Annual Report 2012
29.04.	Roadshow Frankfurt, Deutsche Bank
15.05.	Interim report Q1 2013
29.05.	Kempen & Co. European Property Seminar, Amsterdam
04.06.	Roadshow Paris, Bankhaus Metzler
06.06.	Roadshow Milan, Société Générale
06.-07.06.	M.M. Warburg Highlights Conference, Hamburg
20.06.	Annual General Meeting, Hamburg

14.08.	Interim report H1 2013
11.- .12.09.	Bank of America Merrill Lynch Global Real Estate Conference, New York
16.09.	UBS Best of Germany Conference, New York
23.09.	Berenberg Bank and Goldman Sachs German Corporate Conference, München
26.09.	Baader Investment Conference, München
13.11.	Interim report 9M 2013
14.11.	Roadshow London, Bank of America Merrill Lynch
27.-28.11.	Bankhaus Lampe Hamburg Investment Conference, Hamburg

APPENDIX

Contact

Deutsche EuroShop AG Investor & Public Relations Oderfelder Straße 23 20149 Hamburg

Tel. +49 (40) 41 35 79 - 20 / -22 Fax +49 (40) 41 35 79 - 29 E-Mail: ir@deutsche-euroshop.com Web: www.deutsche-euroshop.com

ir-mall.com

• facebook.com/euroshop
• flickr.com/desag
• slideshare.net/desag
• twitter.com/des_ag
• youtube.com/DeutscheEuroShop

Important Notice: Forward-Looking Statements

Statements in this presentation relating to future status or circumstances, including statements regarding management's plans and objectives for future operations, sales and earnings figures, are forward-looking statements of goals and expectations based on estimates, assumptions and the anticipated effects of future events on current and developing circumstances and do not necessarily predict future results.

Many factors could cause the actual results to be materiallydifferent from those that may be expressed or implied bysuch statements.

Deutsche EuroShop does not intend to update these forward-looking statements and does not assume any obligation to do so.

Claus-Matthias Böge Chief Executive Officer

Olaf G. Borkers Chief Financial Officer

Patrick Kiss Head of Investor & Public Relations

Manager Investor & Public Relations

Nicolas Lissner

³¹