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Qrf
Earnings Release • Oct 27, 2023
3990_10-q_2023-10-27_34a23cbf-0a94-481d-ac74-79e7e067af20.pdf
Earnings Release
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Qrf PRESS RELEASE | THIRD QUARTER 2023 1
Third quarter 2023
Press Release Regulated information 27/10/2023 - 7.40am
MEUR 245.59
Fair Value of the real estate portfolio amounts to MEUR 225.59 at September 30, 2023, including the property in Namur held as Assets held for sale. The decrease in the Fair Value compared to December 31, 2022 (MEUR 233.25) is, on the one hand, due to the sale of the properties in Dendermonde (MEUR 3.16) and Liège (MEUR 1.03), on the other hand, due to the write-downs by the property expert (-2.5%). In addition, Qrf holds financial assets for MEUR 20.00, which includes a redevelopment project for the Century Center in Antwerp.
EUR 14.61
EPRA NTA per share of EUR 14.61 (compared to EUR 15.65 at the end of 2022), IFRS NAV per share of EUR 15.44 (compared to EUR 16.53 at the end of 2022).
52.76%
Debt ratio of 52.76% as of September 30, 2023, down from December 31, 2022 (53.64%). Financial debts were reduced by MEUR 9.25 and amount to MEUR 125.75 at September 30, 2023 (compared to MEUR 135.00 at December 31, 2022).
99.20%
High Occupancy rate of 99.20%, stable compared to December 31, 2022 (99.35%).
Reporting
Qrf was awarded an sBPR Silver score by EPRA for its sustainability reporting included in the annual report for fiscal year 2022, as well as the Most improved Award. These awards confirm the efforts made in terms of ESG and reporting. In addition, as in previous years, the EPRA BPR Gold score was again achieved for financial reporting.
EUR 0.80
Confirmation of gross dividend expectation of EUR 0.80 per share.
1 Key figures
CONSOLIDATED KEYFIGURES
| REAL ESTATE PORTFOLIO | 30/09/2023 | 31/12/2022 | |
|---|---|---|---|
| Fair value of the real estate portfolio including assets held for sale1, 2, 3 | (KEUR) | 225,590 | 233,254 |
| Total gross surface area | (m²) | 77,436 | 80,338 |
| Contractual Rents on an annual basis4 | (KEUR) | 14,198 | 14,777 |
| Estimated Rental Value of vacant property | (KEUR) | 114 | 643 |
| Gross portfolio yield5 | 6.37% | 6.34% | |
| Occupancy rate6 | 99.20% | 99.35% | |
| BALANCE SHEET | 30/09/2023 | 31/12/2022 | |
| Shareholders' equity (excl. minority interests) | (KEUR) | 120,379 | 125,380 |
| Debt ratio (under the RREC Act)7 | 52.76% | 53.64% | |
| KEY FIGURES PER SHARE | 30/09/2023 | 31/12/2022 | |
| Total number of shares outstanding at the end of period | (KEUR) | 7,798,886 | 7,582,737 |
| Closing price of the share at the end of period | (KEUR) | 9.80 | 9.14 |
| Market capitalisation | 76.429 | 69,306 | |
| IFRS NAV per share8 | (KEUR) | 15.44 | 16.53 |
| Premium/discount to IFRS NAV (end of period) | (KEUR) | -36.5% | -44.7% |
| EPRA NAV per share9 | (KEUR) | 14.61 | 15.65 |
| Premium/discount to EPRA NAV (end of period) | (KEUR) | -32.9% | -41.6% |
1 Fair Value of the investment properties is the investment value as determined by an independent real estate expert, from which the transaction costs have been deducted. The Fair Value corresponds to the book value under IFRS
2 As of 31/12/2022: excluding MEUR 6.4 held as Assets held for sale related to the participation in the Bond 58 joint venture
3 Including the right of use on a long-term lease in Ghent, Korenmarkt as defined under IFRS16
4 Contractual Rents on an annual basis = The index-adjusted base rental prices as contractually set in the rental contract before the deduction of gratuities or other incentives allowed to the tenant.
5 Gross portfolio yield = (Contractual Rents on an annual basis) / (Fair Value of the real estate portfolio).
6 Occupancy rate = (Contractual Rents on an annual basis excluding rents on development properties) / (Contractual Rents on
an annual basis plus the Estimated Rental Value of vacant spaces excluding vacant spaces of development properties). 7 Calculated according to the R.D. of July 13, 2014 pursuant to the Regulated Real Estate Companies Act of May 12 2014.
8 IFRS NAV per share = Net Asset Value per share according to IFRS.
9 EPRA NAV per share = Net Asset Value per share according to EPRA Best Practice Recommendations.
2 Real estate report
The Fair Value of the investment properties10 is MEUR 225.59 at September 30, 2023 (compared to MEUR 233.25 at December 31, 2022):
» based on the estimate by the Property expert, a write-down of MEUR 5.75 or 2.5% was recorded, mainly due to an increase in the capitalization rate used as a result of the increase in interest rates;
» the final sales for the properties Oude Vest 19-47, Dendermonde (MEUR 3.24) and Rue de la Cathédrale 87-93, Liège (MEUR 0.75), were completed during the first nine months;
» the property Rue de Fer 10, Namur (MEUR 2.80) is held as Assets held for sale, as a binding sales agreement has been concluded. The final sale is scheduled for the fourth quarter;
» the increase in the Fair Value of Veldstraat 88, Ghent (MEUR +2.09), mainly due to capitalized construction costs for the office part;
In addition to the real estate portfolio, Qrf still holds a financial participation (30%) in the joint venture companies of the redevelopment of the Century Center in Antwerp. These interests are valued at MEUR 20.00 as of September 30, 2023.
The Annualized contractual rents amounts to MEUR 14,2011 (compared to MEUR 14.78 at December 31, 2022). The portfolio's Gross Rental Yield is 6.37% compared to 6.34% at the end of 2022. The high Occupancy Rate remains stable at 99.20% (compared to 99.35% at December 31, 2022).
3 Balance sheet
Shareholders' equity (excluding minority interests) decreased to MEUR 120.38 at September 30, 2023 (compared to MEUR 125.38 at December 31, 2022), this mainly due to the payment of the dividend and the write-down of the Fair Value of the investment properties.
The Debt ratio fell to 52.76% (down from 53.64% as on December 31, 2022).
Per 30 September 30, 2023, The Company has MEUR 159 of credit lines with seven different financial institutions, with staggered maturity dates over the period 2024 to 2030, of which 1 credit line of MEUR 10 serves exclusively to cover the issued Commercial Paper. The undrawn portion of the available credit lines amounts to MEUR 32.75 at September 30, 2023. Taking into account the existing debt level, Qrf has no funding risk for the next 20 months.
The average financing cost (including the lender's margin) of Qrf is 2.80%. The increase is mainly explained by the purchase of Korenmarkt 1, Ghent at the end of 2022. This purchase amounting to MEUR 21.0 was fully financed by drawing on the existing credit lines and was fully hedged at the end of November 2022 for a period of 10 years by the purchase of an Interest Rate Swap at 2.79%. As a result, the cost of financing, including lender's margin, is 4.02%.
In addition to this hedging, as of September 30, 2023, the Company also has: MEUR 65 financial debt hedged at a weighted average interest rate of 1.14%, implying a total interest cost including lender's margin of 2.37%; MEUR 24 fixed rate financial debt at a financing cost of 2.40% and MEUR 0.5 commercial paper with weighted average financing cost of 4.32%.
10 This includes the property in Namur (MEUR 2.8) which is held as Assets held for sale
11 Excludes contractual rents of the property held as Assets held for sale.
EPRA NTA per share is EUR 14.61 at September 30, 2023 (EUR 15.65 at December 31, 2022). IFRS NAV per share is EUR 15.44 at September 30, 2023 (EUR 16.53 at December 31, 2022).
4 Outlook
The Company again expects to pay a gross dividend of EUR 0.80 per share to its shareholders for fiscal year 2023.
Caution about predictions
This press release contains forward-looking statements that involve risks and uncertainties, including statements about Qrf's plans, objectives, expectations and intentions. Readers are cautioned that such forward-looking statements involve known and unknown risks and are subject to significant business, economic and competitive uncertainties, many of which are beyond Qrf's control. If one or more of these risks or uncertainties should arise or if the basic assumptions used prove incorrect, the final results may deviate significantly from the predetermined expected, estimated or extrapolated results. As a result, Qrf does not assume any responsibility for the accuracy of these forecasts.
For more information:
William Vanmoerkerke CEO [email protected] Arthur Lesaffre CFO [email protected]
About Qrf:
Qrf is a listed Belgian REIT (BE-REIT) specializing in the niche market of inner-city properties in Belgium and the Netherlands. More specifically, the company focuses on the acquisition, development and leasing of retail, leasure and hotel real estate. On 30 September 2023, the portfolio consists of 31 shopping sites with a total Fair Value of MEUR 226. Qrf has been listed on Euronext Brussels (QRF:BB) since December 2013. On September 30, 2023, the market capitalization is MEUR 76.