| | POLISH FINANCIAL SUPERVISION AUTHORITY | | | | | | | UNI - EN REPORT No | 23 | / | 2015 | | | | | | Date of issue: | 2015-11-18 | | | | | | | | | | | Short name of the issuer | | | | | | | | | | PLAZA CENTERS N.V. | | | | Subject | | | | | | | | | | | | | THIRD QUARTER INTERIM MANAGEMENT STATEMENT AND INTERIM FINANCIAL STATEMENTS | | | | Official market - legal basis | | | | | | | | | Inne uregulowania | | | | Unofficial market - legal basis | | | | | | | | Contents of the report: | | | | | | | | | | | STABLE PERFORMANCE RECORDED IN CORE PORTFOLIO AND FURTHER STRATEGY PROGRESSPlaza 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 July 2015 to 30 September 2015 (the “Period") and unaudited interim financial information for the nine month period ended 30 September, 2015, together with an update on transactional activity to the date of this announcement.
Stable performance at core CEE shopping centres during the Period:
• Portfolio occupancy remained stable at 93.25% as of 30 September 2015, compared to 92% in Q3 2014.
o Over 3,000 sqm of GLA is currently under final negotiations which, when completed, is expected to bring total portfolio occupancy to 95.5%.
o At Torun Plaza, Poland, occupancy increased to 94% (2014: 92.5%), contributing to a slight turnover increase of 2.0% at the shopping centre compared to the same period last year.
o In Riga Plaza Latvia, despite a decrease in occupancy to 96.5% (2014: 99.5%) as a result of a number of small retailers exiting the Latvian market, Riga Plaza recorded an 8.9% increase in turnover and a 3.7% increase in footfall, compared to the same period in 2014.
o Occupancy at Suwalki Plaza, Poland, increased to 95.4% (2014: 92%) following lettings to eight new tenants, including KIK and Altero. With negotiations currently underway on the remaining five units, we expect to reach close to 100% occupancy at the centre in the near future. Suwalki Plaza continues to perform well with turnover up and a 4.5% increase in footfall, versus the third quarter in 2014.
o Turnover and footfall at Zgorzelec Plaza, Poland, remained stable compared to the same period in 2014 despite the closure of a supermarket in April 2015, which led to a decrease in occupancy to 89% (2014: 95.2%). Following the closure, proactive negotiations were held with the remaining tenants, as a result of which the majority elected to continue trading in the centre.
o Turnover at Liberec Plaza, Czech Republic, increased by a significant 10.5%, despite occupancy decreasing slightly to 82.8% (2014: 84%), owing to lease expiries, and footfall being down by 3.73% against the third quarter in 2014.
Portfolio activity during the Period:
As announced on 29 September 2015, a wholly owned subsidiary of the Company was successful in a tender to buy the loan to the wholly owned holding and operating company for Liberec Plaza shopping and entertainment centre in the Czech Republic and the relevant agreement was signed on that date. The subsidiary acquired the €20.4 million bank loan, which was provided by two commercial banks, for €8.5 million, reflecting a 58% discount. The Company recorded a profit on the discount (circa €12 million) in its financial statements for the third quarter of 2015 and anticipates that the mall will deliver a net operating income of circa €850,000 in 2015, which would reflect a yield of approximately 10% on the loan purchase price.
On 10 September 2015, the Company announced the sale of Palazzo Ducale, an 823 sqm office building in Bucharest, Romania, for circa €1.1 million, consistent with the asset’s last reported book value. In line with the Company’s stated restructuring plan, 75% of the net cash proceeds from the sale were distributed to the Company's bondholders as an early repayment in late September 2015.
Supported by very strong tenant demand, construction of Belgrade Plaza (Visnjicka) also commenced during the Period, with demolition works on the existing site now complete and excavation and pile works now underway.
The current consolidated cash balance of the Company is circa €21 million, including approximately €5.9 million of restricted cash mainly held in the operating shopping centres, following interest and principal prepayment on 30 September 2015 of circa €10.4 million.
Further information can be found about the results for the nine months period ending on 30 September 2015 on the Company’s website:
http://www.plazacenters.com/index.php?p=company_presentation
Appointment of a CEO:
On 22 September 2015, Plaza announced the resignation of the CEO, Mr. Akiva Azulay. The appointment of an experienced and able CEO is actively underway and the Company hopes to be able to make an announcement on this in the near future.
Roy Linden, Chief Financial Officer of Plaza Centers N.V., said:
“The third quarter has seen us produce another stable performance across our portfolio with some encouraging figures being recorded in our core shopping centres. Further progress has also been achieved on our strategy of focusing on the core Central and Eastern European markets, to drive value and growth for investors, following the disposal of Koregaon Park and a number of other non-core assets earlier in the year.
“As the result of the Liberec loan purchase and the €1.4 million bank loan forgiveness connected to a plot sold in Ploiest, Romania, a total financial gain of €13.3 million was recorded which has helped us to further deleverage the Company. The planned developments of Timisoara Plaza and Belgrade Plaza (Visnjicka) are advancing and, as we move towards the end of this financial year, we are confident that the Company is in a yet stronger position to deliver on our objectives."For further details please contact:
Plaza
Roy Linden, CFO
+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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