Earnings Release • Feb 20, 2019
Earnings Release
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PER 31 DECEMBER 2018
*Still to be approved for the financial year 2018 by the general meeting of shareholders of 21 May 2019.
In 2018 Qrf City Retail executed its "Rebalancing for future growth" strategy. The execution of this strategy has resulted in the optimization of the portfolio and the company for the 5th year in a row:
In 2019 Qrf City Retail will continue to focus on:
Qrf City Retail confirms its belief in the future of inner city and urban retail properties. Leading experts worldwide calculate that the halo effect of e-commerce (i.e. the impact that local physical shops have as a booster of online sales) accounts for 20% to 40% of the total economic value of a shop.
Qrf City Retail therefore focuses on optimizing and strengthening its real estate portfolio, to be in the best position to address future demand of retailers and so that retailers and visitors have the best experience in and around our retail properties.
In addition to focusing on its growth strategy in inner-city retail real estate and its active management strategy, Qrf City Retail endeavours to capitalize on the sale of non-strategic properties in order to increase the general quality of the portfolio.
In 2018 Qrf City Retail sold 3 non-strategic properties situated in Sint-Niklaas (Stationsstraat 39), Marche-en-Famenne (Rue Du Parc Industriel 8) and Mons (Grand Rue 5). A property situated in Ostend (Adolf Buylstraat 36) was also sold. Together, these divestments accounted for a total net selling price (after deduction of registration fees and other transfer charges) of ca. 8 MEUR.
The overall net selling price of these 4 properties exceeded the last Fair Value, as estimated by an independent chartered surveyor, by 3.2%
| Date | Divestment of | Street | Contractual rents on an an nual basis |
Net selling price |
|---|---|---|---|---|
| 16 April 2018 | A retail property | Sint-Niklaas (Stationsstraat 39) |
Vacant property3 | 675 KEUR |
| 16 October 2018 | A retail site | Marche-en-Famenne (Rue du Parc Industriel 8) |
251 KEUR | 4.400 KEUR |
| 13 December 2018 | A retail property | Ostend (Adolf Buylstraat 36) |
174 KEUR |
2.625 KEUR |
| 27 December 2018 | A retail property | Mons (Grand Rue 5) |
24 KEUR | 290 KEUR |
Qrf City Retail also focused on active asset management this past financial year through:
• a value creating redevelopment and renovation policy, whereby unused floor space is monetized, building structures are made homogenous so that they can be used by most retail concepts, and are combined with sustainable energy performances and a distinct facade look;
• curbing vacancy and the surcharge on unoccupied buildings by attracting pop-up concepts;
The consistent implementation of this strategy has enabled Qrf City Retail to welcome various strong international retailers in its portfolio in recent years. In addition, various pop-up concepts were launched with which, in addition to retaining the value of its portfolio, Qrf City Retail was also able to make a contribution to the value of the inner city.
In 2018 Qrf City Retail moreover welcomed the flagship store of Haren Schoenen in Mechelen, thereby monetizing the upper floors which had previously been vacant. The entire facade was renovated also.
Furthermore, various properties and sites were optimized, including the facade of Adolf Buylstraat 1A (Ostend), the renewal of the roof and technical installations in a number of properties in Boncelles, Liège and Tongeren, and a luxury apartment at Wapper 14-16 (Antwerp) which was refurbished for rental, and the further optimization of a retail warehouse park in Huy.
In financial year 2018 Qrf City Retail announced that it would continue its acquisition strategy in 2019 by buying inner-city properties in Antwerp and Ostend (important Belgian retail cities), through the contribution in kind (at a 13% premium in relation to the share price on 30 January 2019)4 of nine retail properties in Antwerp and Ostend by the Vanmoerkerke family.
The location of the properties is fully in line with the strategic vision of Qrf City Retail. This transaction was completed on 30 January 2019.
Through this operation, Qrf City Retail acquired new tenants such as TUI, Footlocker, Lensonline and Boulangerie Paul outside the fashion segment. This means a further diversification of the portfolio to activities that are less sensitive to e-commerce.
The nine retail properties are expected to generate jointly 1.178 KEUR Contractual Rents on an annual basis.5 The total investment value of these retail properties amounts to 23.8 MEUR.6
Through the above transaction, the shareholders' structure of Qrf Comm. VA evolved as follows:
With the aforementioned transaction, Qrf City Retail managed to decrease the presence of secondary cities in its portfolio in recent years. The most prominent shopping city in Belgium, Antwerp, has taken a dominant position in its portfolio.
More than 75% of the total real estate portfolio of Qrf City Retail is located in 10 important shopping cities in Belgium (Antwerp, Brussels, Ghent, Hasselt, Liège, Namur, Leuven, Mechelen, Aalst and Ostend) and 5 important shopping cities in the Netherlands (Maastricht, Den Bosch, Nijmegen, Zwolle and Enschede).
I. The Board of Directors of the Statutory Manager of Qrf City Retail announced on 5 December 2018 that Mr Preben Bruggeman, CFO (Chief Financial Officer) and Effective leader, decided to leave the company to take on a new professional challenge.
Qrf City Retail has in the meantime already started the search for a new CFO. The current financial team and the CEO, Anneleen Desmyter, have assumed the ongoing activities on an interim basis.
II. Messrs William Vanmoerkerke and Francis Vanderhoydonck replaced Messrs Herman Du Bois and Freddy Hoorens on the Qrf Board of Directors effective as of 31 January 2019.
III. On 19 February 2019, the Board of Directors decided to appoint William Vanmoerkerke as co-CEO, Effective Leader and Permanent Representative of Qrf Management NV. William Vanmoerkerke earned a Master's Degree in Applied Economics from the University of Ghent, a Master's Degree in Marketing Management from the Vlerick Leuven Ghent Management School and a Master's Degree in Business Administration from New York University. He started his career at eBay as a Segment Manager. In 2008, he joined Roland Berger Strategy Consultants, and then in 2012 he joined The Boston Consulting Group where he took up the same position. In 2013 he continued his career as Senior Director Strategy & Business Development at Elsevier Inc.
He will hold this office jointly with CEO Anneleen Desmyter until the General Meeting of Shareholders on 21 May 2019.
IV. Anneleen Desmyter will submit her resignation as CEO and Effective Leader on 21 May 2019. She was one of the founders of Qrf City Retail and served as CEO for more than 5 years. Her voluntary departure is in line with the sale of Qrf Management NV, the Statutory Manager of Qrf City Retail, by the Quares Group, of which Anneleen Desmyter is co-partner.
Francis Vanderhoydonck William Vanmoerkerke
With the completion of the aforementioned contribution in kind (at a 13% premium in relation to the share price on 30 January 2019) the Vanmoerkerke family has taken over 100% of the shares in Qrf Management NV, the Statutory Manager of Qrf City Retail, from the Quares group.7
The interests of the Shareholders and of Management were brought further in line with the entry of the Vanmoerkerke family as reference shareholder and transferee of the Statutory Manager.
Quares Property Management NV and Quares Property & Facility Management BV are no longer affiliated with Qrf City Retail, but will continue to provide technical assistance to ensure the continuity of Qrf City Retail.8
Certain contractual conditions of this property management agreement have been adapted accordingly.
The new Board of Directors of Qrf as of January 30, 2019.
From left to right: William Vanmoerkerke, Jan Brouwers, Francis Vanderhoydonck, Anneleen Desmyter, Inge Boets, Frank De Moor
The financial year 2018 covers the period from 1 January 2018 to 31 December 2018.
| Consolidated key figures | 2018 | 2017 | |
|---|---|---|---|
| Real estate portfolio | |||
| Fair value of the real estate portfolio9 | (KEUR) | 271,794 | 287,404 |
| Total gross surface area | (m²) | 87,116 | 91,573 |
| Contractual Rents on an annual basis10 | (KEUR) | 15,391 | 16,025 |
| Estimated Rental Value of vacant property | (KEUR) | 842 | 417 |
| Gross rental income11 | 5.66% | 5.58% | |
| Occupancy rates12 | 94.82% | 97.47% | |
| Profit and loss account | |||
| Net rental income | (KEUR) | 15,441 | 14,940 |
| Operating result before result on the portfolio | (KEUR) | 11,929 | 11,726 |
| Operating margin13 | 77.3% | 78.5% | |
| Portfolio result | (KEUR) | -7,100 | -3,605 |
| Financial result | (KEUR) | -4,045 | -2,952 |
| Taxes | (KEUR) | -145 | -412 |
| Net result (group share) | (KEUR) | 607 | 4,766 |
| Adjustment for Portfolio Result | (KEUR) | 7,100 | 3,605 |
| Adjustment for changes in the Fair Value of the financial assets and liabilities (non-effective interest rate hedging - IAS 39) |
(KEUR) | 936 | -40 |
| Deferred taxes relating to EPRA changes | (KEUR) | -44 | 0 |
| EPRA earnings14 | (KEUR) | 8,599 | 8,332 |
| Balance sheet | |||
| Shareholders' equity (excl. minority interests) | (KEUR) | 129,272 | 134,710 |
| Debt ratio (RREC Act)15 | 52.12% | 52.69% |
| Consolidated key figures | 2018 | 2017 | |
|---|---|---|---|
| Key figures per share | |||
| Total number of shares outstanding at the end of the period |
5,665,822 | 5,665,822 | |
| Weighted average number of shares16 | 5,665,822 | 5,224,997 | |
| Net result per share | (EUR) | 0.11 | 0.91 |
| EPRA earnings per share | (EUR) | 1.52 | 1.59 |
| Gross dividend per share | (EUR) | 0.80 | 1.35 |
| Dividend ratio payout17 | 52.7% | 84.7% | |
| Gross dividend yield (on closing price of the share at the end of the financial year) |
5.8% | 5.5% | |
| Closing price of the share at the end of the financial year |
(EUR) | 13.80 | 24.38 |
| IFRS NAV per share18 | (EUR) | 22.82 | 23.78 |
| Premium/discount to IFRS NAV (end of financial year) |
-39.5% | 2.5% | |
| EPRA NAV per share (EPRA)19 | (EUR) | 23.11 | 24.12 |
| Premium/discount to EPRA NAV (end of financial year |
-40.3% | 1.1% |
The Net rental income rose by 3.4% from 14.94 MEUR in 2017 to 15.44 MEUR in 2018. This increase is attributable mainly to the full contribution in 2018 of properties which Qrf City Retail had bought in 2017.
The operating margin dropped from 78.5% in 2017 to 77.3% in 2018.
As a result, the operating result before the result on the portfolio has increased by 1.7% from 11.73 MEUR in 2017 to 11.93 MEUR in 2018.
The portfolio result for 2018 amounted to -7.1 MEUR, consisting of
• a positive result from the sale of property investments amounting to 0.25 MEUR (properties situated in Sint-Niklaas, Marche-en-Famenne, Mons and Ostend); and
• negative changes in the Fair Value of the real estate portfolio for an amount of 7.35 MEUR.
These negative changes in the Fair Value of the investment portfolio are attributable to:
The financial result for 2018 amounted to -4.05 MEUR (compared to -2.95 MEUR in 2017). The net interest charges dropped from 2.90 MEUR in 2017 to 2.85 MEUR in 2018. This drop is attributed to a drop in the credit lines taken up, combined with a drop in the Average Cost of Financing to 1.91% (2.07% in 2017). Qrf City Retail recorded a negative variation in the Fair Value of financial assets and liabilities of 0.94 in the profit and loss account 2018.
The Net result (group share) dropped from 4.77 MEUR in 2017 to 0.61 MEUR in 2018, or from 0.91 EUR per share in 2017 to 0.11 EUR per share in 2018.
After adjustment for the portfolio result (-7.1 MEUR) and the change in the Fair Value of financial assets and liabilities (-0.94 MEUR), Qrf City Retail recorded a rise in the EPRA earnings of 3.2% to 8.60 MEUR in 2018 (8.33 MEUR in 2017). The EPRA earnings per share dropped slightly to 1.52 EUR in 2018 (- 4.8% compared with 2017).
By virtue of Article 617 of the Companies Code, calculated pursuant to Chapter 4 of Annex C of the Royal Decree on Regulated Real Estate Companies, the distributable equity capital amounted to 6,779 KEUR on 31 December 2018, and meets the legal requirements to pay out a dividend.
By reducing its net debt burden in 2018, pursuant to Article 13 of the Royal Decree on Regulated Real Estate Companies, Qrf City Retail is not required to proceed to any dividend pay out.
In regard to further strengthening the balance
sheet of the company, the Board of Directors of the Statutory Manager decided to propose to the general meeting of shareholders to pay out a conservative dividend totalling 4,532 KEUR, or 0.80 EUR per share. This reflects the pay-out ratio of 52.7%.
On 31 December 2018, the Fair Value of the real estate portfolio stood at 271.79 MEUR, compared with 287.40 MEUR on 31 December 2107, a drop of 5.4%, as a result of the divestments in 2018 and the variations in the Fair Value of the existing portfolio.
Overall, the portfolio was valued by the chartered surveyor at a gross portfolio yield of 5.66%.
The group's shareholders' equity, excluding minority interests, dropped by 4.0% from 134.71 MEUR on 31 December 2017 to 129.27 MEUR on 31 December 2018.
The number of outstanding shares remained the same at 5,665,822 on 31 December 2018. The IFRS NAV per share dropped by 4.0% from 23.78 EUR on 31 December 2017 to 22.82 EUR on 31 December 2018. The EPRA NAV per share dropped by 4.2% from 24.12 EUR to 23.11 EUR over the same period.
The Debt ratio dropped to 52.12% on 31 December 2018 (52.69% on 31 December 2017).
On 31 December 2018 Qrf City Retail had 141.0 MEUR financial debts consisting of:
On 31 December 2018 Qrf City Retail had 169 MEUR in credit lines. An amount of 40 MEUR of the credit lines is not drawn up and is available.
The Average Cost of Financing amounts to 1.9% in 2018 (2.07% in 2017).
On 31 December 2018, the composition of the financial debts is as follows:
Expiry dates of Commercial Paper
On 31 December 2018, the financial debts (total of credit lines drawn and outstanding commercial paper) had a fixed interest rate for 80.9% of the cases (for a sum amounting to 114 MEUR), for example by using Interest Rate Swaps as a hedge. The fixed interest rates have a weighted average residual term of 4.3 years.
The total value of the hedges on the closure date was negative for the amount of 1.57 MEUR, because of a decline of the interests after the closure of the hedges.
The management of Qrf City Retail wishes to stress the fact that they want to protect the association against potential interest rises to the maximum.
Qrf City Retail obtained the EPRA Gold Award for Financial Reporting for its Annual Report 2017. EPRA, the European Public Real Estate Association, is the voice of the European listed real estate sector. It represents €450 billion in immovable assets (www.epra.com).
| 19 | APRIL 2019 |
|---|---|
| publication Annual Financial Report 2018 | |
| 08 | MAY 2019 |
| publication of the Q1 update for 2019 | |
| 21 | MAY 2019 |
| annual General Meeting of Shareholders | |
| 22 | MAY 2019 |
| dividend 2018 - ex date | |
| 23 | MAY 2019 |
| dividend 2018 - record date | |
| 24 | MAY 2019 |
| dividend 2018 - payment date | |
| 21 | AUGUST 2019 |
| publication of half-yearly results and half-yearly report for 2019 | |
| 13 | NOVEMBER 2019 |
| publication of the Q3 update for 2019 | |
1 The decrease to 47.9% was calculated on the basis of the figures as at 31 December 2018.
2 As of January 30, 2019 implemented through the contribution transaction by the Vanmoerkerke family (see also 3.2).
3 The Estimated Rental Value on an annual basis amounted to 50 KEUR on 31/03/2018.
4 The contributors (Horizon Retail Investeringen WP BVBA and Horizon Retail Investeringen DMB NV, two companies controlled by the Vanmoerkerke family) were remunerated with 1,487,500 new Qrf City Retail shares at an issue price set contractually at 16.00 EUR per share. This implies a premium of 13% with respect to the closing price of 14.15 EUR on 30 January 2019 and a premium of 12% with respect to the average closing price during the 30 calendar days prior to the date of this press release. The new shares are ordinary shares that have the same rights as the existing shares, except for the fact that they do not entitle holders to the dividend for the financial year ending on 31 December 2018. The new shares will be entitled to a share of the profits as of 1 January 2019.
5 Seven of the nine properties were let on the date of the transaction and will generate 908 KEUR in Contractual rents on an annual basis. Two of the nine properties were not let on the same date. For these two properties, the contributor has given a rental income guarantee to Qrf City Retail for a period of 6 months for an amount of 270 KEUR on an annual basis. In the meantime, a lease has been concluded concerning one of the vacant retail properties.
6 The acquisition value of the aforementioned acquisitions meets the requirements of Article 49 § 1 of the RREC Act.
7 Via its subsidiaries "Quares REIM Retail NV" and "Quares Holding CVBA" which jointly own 100% of the shares of "Qrf Management NV".
8 The technical and administrative management of the portfolio of Qrf City Retail is outsourced to Quares Property Management NV (for the real estate portfolio situated in Belgium) and to Quares Property & Facility Management BV (for the real estate portfolio situated in the Netherlands) by virtue of a property management agreement.
9 Fair Value of the real estate portfolio = The investment value as defined by an independent chartered surveyor, from which the transfer costs are deducted. The Fair Value is equivalent to the book value under IFRS.
10 Contractual rents on an annual basis = The index-adjusted base rental prices as contractually set in the recent contract before the deduction of gratuities or other incentives allowed to the tenants.
11 Gross portfolio yield = (Contractual rents on an annual basis) / (Fair Value of the real estate portfolio).
12 Occupancy rate = (Contractual rents on an annual basis) / (Contractual rents on an annual basis including the Estimated Rental Value of vacant property).
13 Operating margin = Operating result before the result on the portfolio / (Net rental income).
14 EPRA earnings = Net result (group share) excluding the portfolio result and changes in the Fair Value of the non-effective interest rate hedges. This term is used in accordance with the Best Practice Recommendations of the EPRA.
15 Calculated in accordance with the Royal Decree of 13 July 2014 implementing the Regulated Real Estate Companies Act of 12 May 2014.
16 Shares are counted pro-rata temporis from the time of issue. The time of issue differs in this case from the time of profit sharing.
19 EPRA NAV per share = Net Asset Value per share according to EPRA Best Practice Recommendations.
| Figures in thousands EUR | 31/12/2018 | 31/12/2017 | |
|---|---|---|---|
| (+) | I. Rental income | 15,529 | 14,949 |
| (+) | II. Writebacks carried forward and discounted rents | 0 | 0 |
| (+/-) | III. Rental-related expenses | -88 | -10 |
| net rental income | 15,441 | 14,940 |
|---|---|---|
| ------------------- | -------- | -------- |
| (+) | IV. Recovery of property charges | 0 | 0 |
|---|---|---|---|
| (+) | V. Recovery of rent charges and taxes normally borne by the tenant on the leased buildings |
1,077 | 1,178 |
| (-) | VI. Costs payable by tenants and borne by the landlord for rental damage and refurbishment at end of lease |
0 | 0 |
| (-) | VII. Charges and taxes normally payable by tenants on let properties | -1,184 | -1,213 |
| (+/-) | VIII. Other rental-related income and expenditure | 0 | 0 |
| PROPERTY RESULT | 15,334 | 14,905 | |
|---|---|---|---|
| (-) | IX. Technical costs | -330 | -289 |
| (-) | X. Commercial costs | -174 | -155 |
| (-) | XI. Costs and taxes on un-let properties | -154 | -164 |
| (-) | XII. Real estate management costs | -570 | -546 |
| (-) | XIII. Other real estate charges | 0 | 0 |
| property charges | -1,228 | -1,155 |
| OPERATING PROPERTY RESULT | 14,107 | 13,750 |
|---|---|---|
| 14 107 | 12750 |
|---|---|
| (-) | XIV. Corporate operating charges | -2,184 | -2,026 |
|---|---|---|---|
| (+/-) | XV. Other operating charges and income | 8 | 1 |
* Basic assumptions concerning the figures on 31 December 2018. The financial information regarding the period ending at 31 December 2018 is drafted in accordance with the International Financial Reporting Standards (IFRS), as these have been accepted and set by the European Commission. This financial report has to be read together with the financial report on the financial year ending on 31 December 2018. The published numbers in this report are consolidated numbers in conformity with the relevant legislation, holdings and subsidiaries have been consolidated.
| (+/-) XVI. Result on disposal of investment properties 249 466 (+/-) XVII. Result on disposal of other non-financial assets 0 0 (+/-) XVIII. Changes in the Fair Value of investment properties -7,349 -4,071 (+/-) XIX. Other result on the portfolio 0 0 -7,100 -3,605 portfolio result OPERATING RESULT 4,830 8,120 (+) XX. Financial income 0 10 (-) XXI. Net interest costs -2,851 -2,902 (-) XXII. Other financial costs -258 -100 (+/-) XXIII. Changes in the Fair Value of financial assets and liabilities -936 40 -4,045 -2,952 financial result (+) XXIV. Share in the result of associated corporations and joint ventu 0 0 res RESULT BEFORE TAXES 785 5,169 (+/-) XXV. Corporate tax -145 -412 (+/-) XXVI. Exit tax 0 0 -145 -412 taxes NET RESULT 641 4,756 ATTRIBUTABLE TO: Shareholders of the group 608 4,766 Minority interests 33 -10 COMPONENTS OF THE NET RESULT – GROUP SHAREHOLDERS: NET RESULT (GROUP SHARE) 608 4,766 |
Adjustment for result on portfolio 7,100 3,605 Adjustment for changes in the Fair Value of assets and liabilities 936 -40 Deferred taxes relating to EPRA changes -44 0 |
OPERATING RESULT BEFORE THE RESULT ON THE PORTFOLIO | 11,930 | 11,726 |
|---|---|---|---|---|
| EPRA RESULTAAT* | 8,600 | 8,332 |
|---|---|---|
* EPRA earnings = Net result (group share) excluding the portfolio result and the changes in the Fair Value of the non-effective hedges and EPRA changes relating to deferred taxes.
| Figures in thousands EUR | 31/12/2018 | 31/12/2017 | |
|---|---|---|---|
| I. NET RESULT | 641 | 4,756 | |
| II. OTHER ELEMENTS OF THE GLOBAL RESULT RECYCLABLE IN PROFIT-AND-LOSS STATEMENT |
0 | 0 | |
| (+/-) | B. Variations on the effective part of the Fair Value of allowed hed ges of the cash flow as defined in IFRS |
0 | 0 |
| OVERALL RESULT | 641 | 4,756 | |
| Shareholders of the group | 608 | 4,766 |
|---|---|---|
| Minority interests | 33 | -10 |
TOEREKENBAAR AAN:
| Figures in EUR | 31/12/2018 | 31/12/2017 |
|---|---|---|
| Number of ordinary shares in circulation at the end of the period | 5,665,822 | 5,665,822 |
| Weighted average number of shares during the period | 5,665,822 | 5,224,997 |
| NET RESULT PER ORDINARY SHARE (GROUP SHARE) (IN EUR) |
0.11 | 0.91 |
| DILUTED NET RESULT PER SHARE – GROUP SHARE | 0.11 | 0.91 |
(IN EUR)
| Figures in thousands EUR | 31/12/2018 | 31/12/2017 | |
|---|---|---|---|
| I. fixed assets |
271,825 | 287,452 | |
| A | Goodwill | 0 | 0 |
| B | Intangible fixed assets | 0 | 0 |
| C | Property investments | 271,794 | 287,404 |
| D | Other tangible fixed assets | 32 | 49 |
| E | Financial fixed assets | 0 | 0 |
| F | Financial leasing receivables | 0 | 0 |
| G | Trade receivables and other fixed assets | 0 | 0 |
| H | Deferred taxes - assets | 0 | 0 |
| I | Investments in associated corporations and joint ventures – chan ges in equity |
0 | 0 |
| II. current assets |
3,871 | 3,870 | |
| A | Assets intended for sale | 0 | 0 |
| B | Current financial assets | 0 | 0 |
| C | Finance leasing receivables | 0 | 0 |
| D | Trade receivables | 372 | 629 |
| E | Tax receivables and other current assets | 1,126 | 513 |
| F | Cash and cash equivalents | 2,180 | 2,577 |
| G | Accruals – assets | 192 | 152 |
|--|
| Figures in duizenden EUR | 31/12/2018 | 31/12/2017 | |
|---|---|---|---|
| shareholders equity | 129,572 | 134,978 | |
| I. | Equity capital attributable to the shareholders of the parent compa ny |
129,272 | 134,710 |
| A | Capital | 131,572 | 131,572 |
| a. Subscribed capital | 131,724 | 131,724 | |
| b. Costs of capital increases | -152 | -152 | |
| B | Issue premiums | 1,496 | 1,496 |
| C | Reserves | -4,405 | -3,124 |
| D | Net result for the financial year | 608 | 4,766 |
| II. | Minority interests | 300 | 267 |
| liabilities | 146,124 | 156,344 | |
| I. | Non-current liabilities | 130,781 | 126,456 |
| A | Provisions | 0 | 0 |
| B | Non-current financial debts | 128,928 | 124,434 |
| a. Credit institutions | 128,928 | 124,434 | |
| b. Financial leasing | 0 | 0 | |
| c. Other | 0 | 0 | |
| C | Other non-current financial liabilities | 1,567 | 1,639 |
| D | Trade debts and other non-current debts | 0 | 0 |
| E | Other non-current liabilities | 105 | 113 |
| F | Deferred taxes – liabilities | 181 | 270 |
| a. Exit tax | 0 | 0 | |
| b. Other | 181 | 270 |
| II. | Short-term liabilities | 15,343 | 29,888 |
|---|---|---|---|
| A | Provisions | 0 | 0 |
| B | Short-term financial debts | 12,000 | 24,994 |
| a. Credit institutions | 0 | 0 | |
| b. Financial Leasing | 0 | 0 | |
| c. Other | 0 | 0 | |
| C | Other short-term financial liabilities | 0 | 174 |
| D | Trade debts and other short-term debts | 1,325 | 2,640 |
| a. Exit tax | 0 | 0 | |
| b. Other | 1,325 | 2,640 | |
| E | Other short-term liabilities | 1,324 | 1,327 |
| F | Accruals - liabilities | 694 | 753 |
| TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES | 275,696 | 291,322 |
| Figures in thousands EUR | 31/12/2018 | 31/12/2017 |
|---|---|---|
| CASH AND CASH EQUIVALENTS AT START OF PERIOD | 2,577 | 7,005 |
| 1. CASH FLOW FROM BUSINESS ACTIVITIES | 7,448 | 1,115 |
| Net result | 640 | 4,756 |
| Unpaid interests and bank charges | 135 | 103 |
| Adjustment of the result for non cash-flow transactions | 7,739 | 4,504 |
| - Depreciation of activated financing costs | 33 | 34 |
| - Depreciation of intangible and other material fixed assets | 22 | 23 |
| - Result of the sale of real estate investments | -250 | -467 |
| - Increase/decrease of the provisions (+/-) | -47 | 883 |
| - Variation in the Fair Value of real estate investments and development property | 7,348 | 4,071 |
| - Variation in the Fair Value of financial assets and liabilities | 633 | -40 |
| Variations in the working capital requirement: | -1,068 | -8,248 |
| Movement of assets: | 409 | 0 |
| - Trade receivables | 257 | 31 |
| - Tax receivables and other current assets | 192 | 14 |
| - Accruals | -40 | -45 |
| Movement of liabilities: | -1,476 | -8,248 |
| - Other short-term financial liabilities | 0 | 0 |
| - Provisions | 0 | 0 |
| - Other non-current liabilities | -9 | 33 |
| - Deferred taxes – liabilities | 0 | 0 |
| - Trade debts and other short-term debts | -942 | -8,280 |
| - Other short-term liabilities (incl. tax debts) | -3 | 0 |
| - Accruals | -522 | 0 |
| 2. CASH-FLOW FROM INVESTMENT ACTIVITIES | 7,613 | -28,982 |
| Acquisitions of intangible and other tangible fixed assets | -5 | -46 |
| Acquisitions of real estate | 0 | -32,980 |
| Investments in existing real estate investments | -82 | -1,573 |
| Income from the sale of real estate investments | 7,700 | 5,617 |
| 3. KASSTROOM UIT FINANCIERINGSACTIVITEITEN | -15,458 | 23,439 |
|---|---|---|
| Repayment of loans | -55,500 | -6,500 |
| Drawdown of loans | 47,000 | 36,000 |
| Costs related to capital increase | 0 | -41 |
| Payment of dividends | -6,925 | -6,007 |
| Payment of transaction costs | -33 | -13 |
| CASH AND CASH EQUIVALENTS AT END OF PERIOD | 2,180 | 2,577 |
|---|---|---|
The European Securities and Markets Authority (ESMA) has published regulations that are applicable since the 3rd of July 2016 for the use and explanation of alternative performance measures.
Alternative performance measures are measures used by Qrf City Retail in presenting its financial results that are not defined by law or in the International Financial Reporting Standards (IFRS).
Below, there is an overview of the alternative performance measures that are used in this press release and their reconciliation.
EPRA NAV: Net Asset Value according to the Best Practice Recommendations of EPRA.
Definition: This is the Net Asset Value adjusted to include properties and other investment interests at Fair Value and to exclude certain items not expected to crystallize in a long-term investment property business model.
Objective: This APM shows the Net Asset Value for a long-term investment strategy.
For the reconciliation of this APM, reference is made to the reconciliation table EPRA NAV per share.
EPRA NAV per share: Net Asset Value per share according to the EPRA Best Practices Recommendations.
Definition: Net Asset Value adjusted to include properties and other investment interests at Fair Value and to exclude certain items not expected to crystallize in a long-term investment property business model.
Objective: This APM shows the Net Asset Value per share for a long-term investment strategy.
| Figures in thousands EUR | 31/12/2018 | 31/12/2017 | |
|---|---|---|---|
| IFRS NAV (GROUP SHAREHOLDERS) | 129,272 | 134,710 | |
| (iv) | Fair Value of financial instruments | 1,567 | 1,813 |
| (v.a) | Deferred tax | 181 | 270 |
| Minority interests with regards to deferred tax | -89 | -132 | |
| EPRA NAV | 130,931 | 136,661 | |
| Number of shares | 5,665,822 | 5,665,822 | |
| EPRA NAV PER SHARE (IN EUR) | 23.11 | 24.12 |
Definition: Net result (group share) with the exclusion of the portfolio result and changes in the Fair Value of non-effective interest rate hedges. This term is used in accordance with the EPRA Best Practices Recommendations.
Objective: This APM measures the underlying operational results of the company, with the exclusion of the result arising out of fluctuations in the value of assets and liabilities and capital gains and losses from the sale of investment properties.
| Figures in thousands EUR | 31/12/2018 | 31/12/2017 | |
|---|---|---|---|
| IFRS RESULT (GROUP SHAREHOLDERS) | 608 | 4,766 | |
| (i) | Changes in the Fair Value of real estate investments | 7,349 | 4,071 |
| (ii) | Profit or loss on the sale of real estate investments | -249 | -466 |
| (vi) | Changes in the Fair Value of financial instruments | 936 | -40 |
| (viii) | Deferred taxes relating to EPRA changes | -44 | 0 |
| EPRA EARNINGS | 8,600 | 8,332 |
|---|---|---|
| Weighted average number of shares | 5,665,822 | 5,224,977 |
| EPRA EARNINGS PER SHARE (IN EUR) | 1.52 | 1.59 |
Definition: This is the Average Cost of Financing of the financial debts, calculated by dividing the "net interest costs" on an annual basis by the average amount of outstanding financial debts during the period.
Objective: The Company's activities are partially financed by incurring debt. This APM measures the Average Cost of Financing of such debts.
| Figures in thousands EUR | 31/12/2018 | 31/12/2017 |
|---|---|---|
| XXI. NET INTEREST COSTS | 2,851 | 2,902 |
| Weighted average amount of financial debt during the period | 149,521 | 140,464 |
| AVERAGE FINANCING COST | 1.91% | 2.07% |
Definition: This APM measures the operating profitability of the company as a percentage of the rental income and is calculated by dividing "Operating result before the result on the portfolio" by the "Net rental income".
Objective: This APM measures the operating profitability of the company.
Reconciliation:
| Figures in thousands EUR | 31/12/2018 | 31/12/2017 |
|---|---|---|
| Operating result before the result on the portfolio | 11,930 | 11,726 |
| Net rental income | 15,441 | 14,940 |
| OPERATING MARGIN | 77.26% | 78.49% |
Qrf City Retail is a listed Belgian REIT (BE-REIT) specialising in the niche market of retail properties in Belgium and the Netherlands. More specifically, the company focuses on the acquisition, development and leasing of centrally located city premises, within areas known as the "Golden Mile" – inner-city streets with major catchment areas. On 31 December 2018, the real estate portfolio consisted of 52 retail properties with a total Fair Value of more than 271 MEUR.
Qrf City Retail has been listed on Euronext Brussels (QRF:BB) since December 2013. On 31 December 2018, the company's market capitalisation amounted to 78 MEUR.
Qrf Comm. VA Public BE-REIT under Belgian law Museumstraat 11/211, B-2000 Antwerpen Tel. +32 3 233 52 46 - Fax +32 3 369 94 24 - [email protected] Company No 0537 979 024 - RPM Antwerpen
This press release contains forward-looking statements involving risks and uncertainties, including statements regarding Qrf City Retail's plans, targets, expectations and intentions. Readers are reminded that such forward-looking statements involve known and unknown risks and are subject to major corporate, economic and competitive uncertainties to a large extent outside the control of Qrf City Retail. Should one or more of these risks or uncertainties materialise, or should assumptions used prove incorrect, the final results could substantially vary from those anticipated, expected, estimated or projected. Qrf City Retail consequently assumes no responsibility for the accuracy of these forecasts.
Anneleen Desmyter [email protected] +32 3 233 52 46
CO-CEO William Vanmoerkerke [email protected] +32 3 233 52 46
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