| | POLISH FINANCIAL SUPERVISION AUTHORITY | |
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| | | UNI - EN REPORT No | 23 | / | 2014 |
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| | Date of issue: | 2014-08-28 | | | | | | | | |
| | Short name of the issuer | | | | | | | |
| | PLAZA CENTERS N.V. | |
| | Subject | | | | | | | | | | |
| | RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2014 - PLAZA REPORTS SUCCESSFUL CONCLUSION OF RESTRUCTURING PROCESS AND SIGNIFICANT OPERATIONAL PROGRESS | |
| | Official market - legal basis | | | | | | |
| | Inne uregulowania
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| | Unofficial market - legal basis | | | | | |
| | Contents of the report: | | | | | | | | |
| | Plaza Centers N.V. (“Plaza" / “Company" / “Group"), a leading property developer and investor with operations in Central and Eastern Europe (“CEE") and India, today announces its results for the six months ended 30 June 2014.
Financial highlights:
• Reduction in total assets to €519 million (31 December 2013: €586 million), primarily due to a non-cash, predominantly market-related impairment of €70 million in the value of trading properties mainly in Romania (€43 million), India (€10 million) and Greece (€11 million).
• Total revenues decreased to €12.6 million (30 June 2013 €14.3 million), largely due to the closure of some of the gaming and entertainment units at Fantasy Park, which resulted in a €1.4 million decrease in revenue, and the sale of the Prague 3 project in Czech Republic in the second half of 2013 (which caused a €0.7 million decrease). Without these changes, the revenues would have been €14.7 million.
• Losses in the period of €99 million (30 June 2013: €81 million loss), arising from the non-cash €70 million impairment of trading property, net finance costs of €27 million and restructuring costs of €2.5 million.
• Basic and diluted loss per share of €0.33 (30 June 2013: €0.27 loss per share).
• Consolidated cash position at the period end (including restricted bank deposits and held for trade financial assets) of €35 million (31 December 2013: €34 million) and current cash position of circa €34 million.
Asset and operational highlights:
• Significant improvements in turnover and occupancy levels across Plaza’s existing shopping and entertainment centres, with increases in turnover reaching a peak of 20%, compared to the second quarter of 2013, and overall average occupancy now reaching circa 94%. This is the result of a number of new anchor tenants opening stores and a general strengthening of the tenant mix across the portfolio. Notable achievements included:
o At Torun Plaza, Poland turnover rose by 19.8% compared to the same quarter of last year, the largest increase across the portfolio, supported by the opening of over 4,000 sqm of new retail space since March 2014 and an additional 1,400 sqm being taken by Sports Direct in July.
o At Zgorzelec Plaza, Poland sales remained strong, resulting in a 19.7% increase in turnover compared to the same quarter last year.
o At Riga Plaza, Latvia, Plaza’s largest shopping and entertainment centre and one of the fastest growing and most popular centres in the country, turnover increased by 17.8% in the second quarter compared to the corresponding period in 2013. Occupancy levels reached 97%.
o At Suwalki Plaza, Poland turnover grew by 10.7% in Q2 compared to Q2 2013 and occupancy increased to 93%. Suwalki Plaza has developed a strong market position due to its location and tenant mix. It is expected that the arrival of the Euro in Lithuania in January 2015 will boost Suwalki’s appeal to customers in neighbouring geographies, providing an opportunity to further build market share.
o At Liberec Plaza, Czech Republic turnover increased by 9.3% compared to Q2 of 2013, buoyed by Sports Direct opening a new 1,600 sqm store.
o At Kragujevac Plaza, Serbia turnover continued to increase at a steady level, rising by 5.7% quarter to quarter.
• Footfall increased in the majority of centres during the period. Significant improvements included: an 8.2% increase in footfall at Kragujevac Plaza; a 7.8% increase at Zgorzelec Plaza; a 6.9% increase at Riga Plaza; and a 6.4% increase at Torun Plaza.
• Across the portfolio, Plaza successfully secured a number of significant tenants, including: H&M, which opened a 2,835 sqm shop in Riga Plaza in April; Sports Direct, which opened a 1,600 store in Liberec and a 1,400 sqm store in Torun; Carry, which opened a 1,275 sqm store in Torun Plaza, an 888 sqm store in Suwalki Plaza and a 547 sqm store in Zgorzelec Plaza between April and May; and Sin-say, which opened a 340 sqm shop in Torun Plaza.Restructuring process and key highlights since the period end:
• On 8 July 2014, the Dutch Court approved the Company’s Dutch restructuring plan (“the Plan") following approval from 92% of creditors who voted in favour of the Plan, thereby demonstrating their resounding endorsement. The restructuring process was formally concluded on 18 July 2014, meaning that the whole process was swiftly and successfully resolved in a period of less than eight months.
• The approval of the Plan will allow the Company to proceed with a proposed rights offering of shares to its existing shareholders to raise an aggregate amount of €20 million in order to further strengthen the Company’s equity position and comply with the conditions for the approval of the Plan. Plaza’s parent company, Elbit Imaging Ltd, has announced that its wholly owned subsidiary, Elbit Ultrasound (Luxembourg) BV/ S. a' r. l ("EUL") intends to enter into a Deed of Undertaking (the “Undertaking") with Plaza. As part of this, EUL has undertaken, among other matters, to ensure that it will exercise EUL's rights to take up EUL's full pro-rata portion under the Rights Offering and that it will subscribe for any unexercised portion of the Rights Offering (the “Additional Shares"), at a price per share of EUR 0.105, all subject to the provisions of the Back Stop Agreement (as defined in the announcement published on 23 June 2014). Plaza’s shares will also be admitted to trading on the Tel Aviv Stock Exchange following the rights issuance.
• Five new board appointments were announced in July, bringing the board membership to seven. The Company is looking forward to benefitting from the experience of the newly configured board as it develops its strategy now that the liquidity situation has been fully and satisfactorily resolved.
Commenting on the results, Ran Shtarkman, the President and CEO of Plaza Centers, said:
“The past six months have been highly significant for Plaza Centers. It was gratifying to be able to confirm the conclusion of the Company’s restructuring process in July, less than eight months after we made the initial announcement, and we are looking forward now to the future. The timeframe in which we were able to complete the process and the resounding support we secured from our creditors has been notable.
“During this particularly busy period for the Company, we were also able to make significant operational improvements across the business. We have delivered double digit turnover increases at Torun, Zgorzelec, Riga and Suwalki, while footfall trends were positive; Kragujevac Plaza recorded the largest increase at 8.2%. Occupancy levels now exceed 92% in five of our six CEE shopping centres and H&M, Sports Direct and TK Maxx are among some of the high profile tenants with whom we have secured agreements in the period. This is testament to the talent of our management team and puts us in a solid position for growth.
“We maintain a cautious approach to development, given ongoing economic uncertainty, but the macro situation is now showing clear signs of improving. With the help of our newly configured board, we can begin planning for the long term and I believe we are in a strong position now to drive capital value and income growth for the benefit of our shareholders, including bringing forward a number of development projects where appropriate."
For further details, please contact:
Plaza
Ran Shtarkman, President and CEO
Roy Linden, CFO
+36 1 462 7221
+36 1 462 7222
FTI Consulting
Stephanie Highett / Claire Turvey / Nina Legge
+44 (0)20 3727 1000
Notes to Editors
Plaza Centres N.V. (www.plazacenters.com) is a leading emerging markets developer of shopping and entertainment centres with operations in Central and Eastern Europe and India. It focuses on constructing new centres and, where there is significant redevelopment potential, redeveloping existing centres in both capital cities and important regional centres. The Company is dual listed on the Main Board of the London Stock Exchange and, as of 19 October 2007, the Warsaw Stock Exchange (LSE:"PLAZ", WSE: “PLZ/PLAZACNTR"). Plaza Centers N.V. is an indirect subsidiary of Elbit Imaging Ltd. (“EI"), an Israeli public company whose shares are traded on both the Tel Aviv Stock Exchange in Israel and the NASDAQ Global Market in the United States. It has been active in real estate development in emerging markets for over 18 years.
Forward-looking statements
This press release may contain forward-looking statements with respect to Plaza Centers N.V. future (financial) performance and position. Such statements are based on current expectations, estimates and projections of Plaza Centers N.V. and information currently available to the company. Plaza Centers N.V. cautions readers that such statements involve certain risks and uncertainties that are difficult to predict and therefore it should be understood that many factors can cause actual performance and position to differ materially from these statements. Plaza Centers N.V. has no obligation to update the statements contained in this press release, unless required by law.
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| | Annexes | | | | | | | | | | |
| | File | Description | |
| | Plaza_Centers_RESULTS_2014_H1_FINAL.pdf
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