| | POLISH FINANCIAL SUPERVISION AUTHORITY | | | | | | | UNI - EN REPORT No | 7 | / | 2015 | | | | | | Date of issue: | 2015-05-21 | | | | | | | | | | | Short name of the issuer | | | | | | | | | | PLAZA CENTERS N.V. | | | | Subject | | | | | | | | | | | | | FIRST QUARTER INTERIM MANAGEMENT STATEMENT | | | | Official market - legal basis | | | | | | | | | Inne uregulowania | | | | Unofficial market - legal basis | | | | | | | | Contents of the report: | | | | | | | | | | | - ONGOING PROGRESS IN 2015 –
Koregaon sale completed and funds received
Plaza Centers N.V. (LSE:PLAZ) (“Plaza" / the “Company" / the “Group"), a leading emerging markets property developer, today announces its interim management statement relating to the period from 1 January 2015 to 31 March 2015 (the “Period") and unaudited financial statements for the Period, together with an update on transactional activity to the date of this announcement.
Material events which occurred during the first quarter of 2015 were outlined in the Company’s 2014 annual report, which was published on 30 April 2015 and can be found on the Company’s website at www.plazacenters.com.
Encouraging performance at core CEE shopping centres during the Period:
• Significant growth in turnover across the portfolio in the first quarter, which resulted in an average 9.8% increase compared to the same period of 2014.
o There was strong progress at Riga Plaza (Latvia), which delivered a 15.8% turnover increase, and at Liberec Plaza (Czech Republic), which had a 15.4% increase in turnover in the first three months of the year, compared to the first quarter of 2014.
o Improvements were also seen at Torun Plaza (Poland) and in Suwalki Plaza (Poland), which reported 10.2% and 5.5% sales increases respectively, compared to the corresponding period of 2014.
• Average footfall increased by 4.0% across all the centres during the first quarter, compared to the first quarter of 2014. Continued growth in footfall was most significant at Riga Plaza (Latvia) at 6.4%.
• Following a year of operational improvement in 2014, occupancy across the Company’s existing shopping and entertainment centres in the core Central and Eastern European (“CEE") markets was stable, with overall portfolio occupancy remaining unchanged since the year end, at 94% as at 31 March 2015.
o At Torun Plaza, Poland, occupancy increased marginally to 92.81% (Q4 2014: 92.5%). The Company is currently in final negotiations with potential new tenants on an additional 1,100 sqm of GLA.
o In Latvia, Riga Plaza’s occupancy level fell to 96.1% (Q4 2014: 99.5%), following the decision taken by some retail brands to exit the Latvian market during the first quarter of 2015, however we expect this to be temporary as there has been strong interest from other potential tenants for the vacant units.
o Suwalki Plaza, Poland, is now almost fully let. Occupancy increased to 99.26% (Q4 2014: 97.7%) as an additional 754 sqm of GLA was leased during the first quarter to tenants including KiK, Altero and Monari.
o Occupancy at Zgorzelec Plaza, Poland, reduced to 88.6% (Q4 2014: 95.2%), following the closure of a 790 sqm supermarket unit.
o Liberec Plaza, Czech Republic, reported a small drop in occupancy to 81% (Q4 2014: 84%) due to lease agreement expiries. We have received interest in the vacant units and negotiations are underway with potential new tenants.
Further to the announcement of 13 May, the Company has now completed the sale of Koregaon Park Plaza, the retail, entertainment and office scheme located in Pune, India for c. €35 million (2,500 million INR), as part of its ongoing strategy to refocus on the core geographies of Central and Eastern Europe (“CEE"). The price is consistent with the asset’s last reported book value and the net cash proceeds (after the repayment of the related bank loan, other liabilities and transaction costs) from the sale will be c. €7.2 million (516.5 million INR). In line with the Company’s stated restructuring plan, which excludes specifically Koregaon Park Plaza, the net cash proceeds from the sale will be put towards Plaza’s future investments and general corporate purposes.
The current consolidated cash balance of the Company is circa €48 million including approximately €10.8 million of restricted cash mainly in the operating shopping centres.
Ran Shtarkman, President and Chief Executive Officer of Plaza Centers N.V., said:
“Following the extensive activity undertaken by the Company in 2014 and the pleasing performance of our retail and leisure portfolio over the course of last year, 2015 is about recalibrating the business to ensure that it is well positioned to drive value for our shareholders and bondholders. To that end, we have seen continuing steady progress during the Period, including the sale of Koregaon Plaza, which represents a significant step forward in our strategy to scale down the Indian activities and focus our efforts on our core portfolio.
“Central and Eastern Europe is where we see the strongest opportunities for income growth and where we are seeing some signs of economic recovery and increasing consumer confidence. Against this backdrop, our intensive asset management initiatives are continuing and the planned development projects at, Timisoara in Romania, Belgrade Plaza (Visnjicka) in Serbia and Lodz Plaza in Poland are on track. The return of capital to our creditors remains a key priority and we are working closely with the board to ensure that their interests are considered in all strategic decisions." For further details please contact:
Plaza
Ran Shtarkman, President and CEO
Roy Linden, CFO
+36 1 462 7221
+36 1 462 7222
FTI Consulting
Dido Laurimore / Claire Turvey / Tom Gough
+44 20 3727 1000Plaza Centers 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 listed on the Main Board of the London Stock Exchange, the Warsaw Stock Exchange and, as of 27 November 2014, the Tel Aviv Stock Exchange (LSE:"PLAZ"; WSE: “PLZ/PLAZACNTR"; TASE: “PLAZ"). 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 19 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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