Earnings at June 30, 2024
Sustainable outperformance
- Strong Recurring Net Income up +8.4% per share
- Portfolio valuation stabilized (+0.2% LfL) leading to NTA at €142.1 per share
- Strong rental uplift captured in both on offices (+14%) and residences (+15%)
- Sound balance sheet with low LTV at 35% and decreasing financial expenses
- 2 new emblematic and accretive large development projects to be launched in Neuilly and Paris City
- Guidance confirmed: RNI per share expected between €6.35 and €6.40 (i.e. +5.5% to +6.5%)
Strong Recurring Net Income growth per share (+8.4% in H1-2024), for the 3rd consecutive year
- Centrality: +6.3% LfL rental growth
- Rental uplift along tenants’ rotation on residential segment (+15%) and offices (+28% in Paris, +14% in average)
- Indexation still supportive (+5.4%) and roughly stable occupancy
- Pipeline: accretive contribution (+€7m)
- Fully pre-let office assets delivered in 2023-2024 (Boétie-Paris CBD and Porte Sud-Montrouge) and one residential project in Ville d’Avray
- Best in class balance sheet: decreasing financial expenses (-€8m)
- Stable cost of drawn debt at 1.1%, with optimum hedging (c.100% until end-2026, and 84% in average until end-2029)
- Net debt lowered by -€0.8bn following disposals since early 2023
Portfolio value stabilized driven by central locations
- Portfolio valuation up +0.4% LfL (Offices) over 6 months
- Revaluation +2% in Paris City …
- … offsetting still decreasing values outside (-2% La Défense, -5% secondary locations)
- NTA stable at €142.1 per share (-1% in 6 months)
Preparing future growth
- In an uncertain context, best in class balance sheet provides agility and capacity to fund development projects
- Stable LTV at 35.0% (incl. duties) vs. 34.4% end-2023
- ICR up to 6.7x (vs. 5.9x end-2023)
- €4.1bn extra liquidities covering bonds redemptions until end-2028
- New emblematic large projects to be launched, with strong accretive potential in central locations
- 2 new redevelopment projects in Paris City and Neuilly: 55,000 sq.m to be delivered by 2027. Nearly €280m capex required for more than €30m potential new rents
- Total « committed » or « to be committed » pipeline requiring €850m capex from 2024 to 2027, for c.€100m to €120m potential new rents
- Deploying promising new business approach on « ready to use » operated offices and residential assets
- Yourplace, a « plug and play » office solution, to be progressively deployed (5,000 sq.m today), floor by floor in c. 40 assets in Paris, providing extra rental return of more than +20%
- Fully-amenitized apartments also to be progressively deployed on residential segment in the coming years, 150 units on going that way, 600 expected by early 2025
- Energy consumption reduction: -3.4% further decline in H1, after already strong achievement in 2023, illustrating Gecina’s CSR leadership
2024 Guidance confirmed
Recurring Net Income expected between €6.35 and €6.40 per share (i.e. +5.5% to +6.5%)
Beñat Ortega, Chief Executive Officer: “The first-half performance is particularly strong and reflects Gecina’s unique position, which benefits from both the quality and the very favorable location of its portfolio, generating organic growth, and an accretive pipeline, ramping up this growth, as well as a particularly robust balance sheet, protecting our cost of debt. As a result, recurrent net income shows a rarely achieved level of growth with +8.4%.
But looking beyond this very solid performance for the first half of the year, Gecina has an opportunistic strategic position, with a financial structure able to not only withstand the uncertainties faced, but also finance projects to create value and drive growth. While the valuation of our portfolio stabilized over the first half of this year, we are increasing our visibility and the rental markets in central areas are positive, our balance sheet enables us to launch the development of two major operations, in Paris (Gamma) and Neuilly (Carreau de Neuilly), which will help drive the Group’s outperformance over time. Alongside this, we are ramping up the rollout of new “serviced” offers for both offices and residential, which will also support the Group’s ability to deliver sustainable outperformance”.
Read the full press release
As a specialist for centrality and uses, Gecina operates innovative and sustainable living spaces. A real estate investment company, Gecina owns, manages and develops a unique portfolio at the heart of the Paris Region’s central areas, with more than 1.2 million sq.m of offices and more than 9,000 housing units, almost three-quarters of which are located in Paris City or Neuilly-sur-Seine. These portfolios are valued at 17.1 billion euros at end-June 2024.
Gecina has firmly established its focus on innovation and its human approach at the heart of its strategy to create value and deliver on its purpose: “Empowering shared human experiences at the heart of our sustainable spaces”. For our 100,000 clients, this ambition is supported by our client-centric brand YouFirst. It is also positioned at the heart of UtilesEnsemble, our program setting out our solidarity-based commitments to the environment, to people and to the quality of life in cities.
Gecina is a French real estate investment trust (SIIC) listed on Euronext Paris, and is part of the SBF 120, CAC Next 20, CAC Large 60 and CAC 40 ESG indices. Gecina is also recognized as one of the top-performing companies in its industry by leading sustainability benchmarks and rankings (GRESB, Sustainalytics, MSCI, ISS-ESG and CDP).
To safeguard its communications, Gecina certifies its contents with Wiztrust. You can check their authenticity at www.wiztrust.com.
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Glenn Domingues
Director of Public Affairs and Corporate Communications
