VGP NV: Half Year Results 2015

Press Release

Regulated Information

 31 August 2015

Half year results 2015

Summary

During the first half of 2015 VGP continued to perform strongly with development and leasing activities reaching record levels.

Germany confirmed its role as the leading growth market of the Group during the first half. More than 50% of the current developments under construction are located in Germany.

In other markets, such as Slovakia, Czech Republic, Estonia and Romania development and leasing activities were also buoyant with Czech Republic clearly remaining the second market for VGP with a share of 25% of the current developments under construction.

During the first half of 2015 VGP's activities can be summarised as follows:

• The operating activities resulted in a net profit of € 32.2 million (€ 1.73 per share) for the period ended 30 June 2015 compared to a net profit of € 43.4 million (€ 2.33 per share) and € 30.0 million (on a like for like basis^[2]) respectively as at 30 June 2014.
• The increase in demand of lettable area resulted in the signing of new lease contracts in excess of € 11.3 million in total of which € 10.5 million related to new leases and € 0.9 million related to replacement leases.
• The Group's property portfolio reached an occupancy rate of 94.8% at the end of June 2015 compared to 94.0% as at 31 December 2014.
• The investment property portfolio has now already grown to 25 completed buildings representing 365,971 m² of lettable area with another 19 buildings under construction representing 322,014 m² of lettable area.
• At the end of June 2015 the land bank includes 954,000 m² of new committed development land expected to be acquired during the second half of 2015. New land plots are being targeted and are due to be secured during the second half of 2015 in order to continue to support the development pipeline.
• The net valuation of the property portfolio as at 30 June 2015 showed a net valuation gain of
  € 48.1 million against a net valuation gain of € 40.9 million per 30 June 2014.
• During the first half of 2015 VGP established itself in Spain and it is expected that the first investments in this new market will occur during the second half of the year. Also in other markets than Germany and the Czech Republic, VGP was successful to expand further. During the month of August 2015 a new park close to Budapest was started with a first building which is fully pre-let to a Blue Chip company under a 12 year lease agreement. Finally a further 540,000 m² land plot close to Bratislava was secured to establish a second VGP Park in Slovakia.
• In order to mitigate its future interest rate risk the Group concluded 2 new interest rate swaps, each for a notional amount of € 75 million and 5 year term. These 2 interest rate swaps have a future start date of July 2017 and December 2018 and will run until July 2022 and December 2023 respectively. The average interest rate which has been fixed is 0.84% p.a.
• In order to strengthen its consolidated equity base and support its further growth, VGP NV issued subordinated perpetual securities in July 2015 for an aggregate amount of € 20 million which were fully underwritten by the reference shareholders of the company i.e. VM Invest NV and Little Rock SA. 

For more information

  ^[1]The net profit as at 30 June 2014 included the estimated € 13.4 million profit on the sale of the  associates' portfolio (VGP CZ I & IV and II). The sale of these portfolios was completed in October 2014.