Results for the 6 months ended 30 June 2017 and investor update 5-8 September 2017
2 Disclaimer This document has been prepared and issued by and is the sole responsibility of the management of Echo Polska Properties N.V. (the “Company” or “EPP”) and its subsidiaries. No information made available in connection with this presentation may be passed on, copied, reproduced, in whole or in part, or otherwise disseminated, directly or indirectly, to any other person. The contents of this presentation are to be kept confidential. This document does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any securities of the Company nor shall it or any part of it nor the fact of its distribution form the basis of, or be relied on in connection with, any contract commitment or investment decision in relation thereto nor does it constitute a recommendation regarding the securities of the Company. Investors and prospective investors in securities of the Company are required to make their own independent investigation and appraisal of the business and financial condition of the Company and the nature of the securities. This presentation and any materials distributed in connection with this presentation may include certain forward-looking statements, beliefs or opinions, including statements with respect to the Company’s business, financial condition and results of operations. These statements, which contain the words “anticipate”, “believe”, “intend”, “estimate”, “expect”, “forecast” and words of similar meaning, reflect the Directors’ beliefs and expectations and involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. No representation is made that any of these statements or forecasts will come to pass or that any forecast results will be achieved. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by these statements and forecasts. Past performance of the Company cannot be relied on as a guide to future performance. Forward-looking statements speak only as at the date of this presentation and the Company expressly disclaims any obligations or undertaking to release any update of, or revisions to, any forward-looking statements in this presentation. No statement in this presentation is intended to be a profit forecast. As a result, you are cautioned not to place any undue reliance on such forward-looking statements. The information on which these statements has been based has not been reviewed or reported by EPP’s auditors. This document speaks as of the date hereof. No reliance may be placed for any purposes whatsoever on the information contained in this document or on its completeness, accuracy or fairness. The Company, its advisers and each of their respective members, directors, officers and employees are under no obligation to update or keep current the information contained in this presentation, to correct any inaccuracies which may become apparent, or to publicly announce the result of any revision to the statements made herein except where they would be required to do so under applicable law, and any opinions expressed in them are subject to change without notice. No representation or warranty, express or implied, is given by the Company, or any of its subsidiary undertakings or affiliates or directors, officers, Java Capital or any of its directors or employees or any other person as to the fairness, accuracy or completeness of the information or opinions contained in this presentation and no liability whatsoever for any loss howsoever arising from any use of this presentation or its contents otherwise arising in connection therewith is accepted by any such person in relation to such information.
Contents 3 1. EPP investment case 2. EPP Summary H1 2017 3. Financial results (period ended 30/06/2017) 4. Operational Overview 5. Summary 6. Outlook 7. Appendices 1. Management Team 2. Corporate Structure 3. Polish macroeconomics 4. Real Estate Market Stats 5. Portfolio Statistics
4 EPP investment case
5 EPP investment case EPP mission Creating a national retail champion that leverages both its scale and relationships to provide a leading cash-generating property company that delivers consistent high returns to shareholders. Asset Acquisitions Management Development & Extensions
6 EPP investment case Focus on dominant and Poland Consolidation of retail market sustainable shopping centers Create environments where Deliver sustainable growth Attractive and secure yields retailers thrive in DPS Attracting the best talents Strategic partners Strong proprietary pipeline
7 EPP Summary H1 2017 OUR PROPERTIES SUCCESSFULLY EXECUTED Retail Acquisitions ACQUISITIONS IN H1 2017 13 Shopping centers € 262 million 2 Retail developments 100 000 m² 9 Office projects Additional NOI - € 18 milion 4 acquired retail yielding assets 18 Cities in Poland 1 retail development site in Warsaw (81 900 m²) per annum 1 office project (ROFO) Warsaw Developments YIELDING PORTFOLIO OF NET ASSET VALUE €1. 6 billion € 864 milion 81 900m² , Galeria Młociny €1.23 per share – 110 000m², Towarowa 22 Retail potfolio – 74% value 6% growth since YE 2016 Office portfolio – 26% value 18% growth since listing FORWARD YIELD OF LTV OF DISTRIBUTABLE INCOME € 71 million 8.0%* 51% (52.7% at YE 2016) €cents 10.8 per share – * Forward yield to 12 months ended 31 December on track to deliver FY17 forecast 2017. At price of R20.9 and ZAR/EUR 15.4
8 Financial Review
Financial 9 review 2017 Financials at a glance 6 months to 12 months to 30 June 2017 31 Dec 2016 DPS 1 €cents 5.19 €cents 5.80 DPS (excluding income tax) 1 € cents 5.40 € cents 5.96 Distributable earnings 1 € 36.6 M € 34.0 M Distributable earnings (excl. income tax) 1 € 38.1 M € 34.9 M Total NAV 2 € 864 M € 683 M NAV per share €1.23 € 1.16 Total assets €1 868 M € 1 509 M Market capitalisation €907 M € 797 M Cost of debt 2.04% 1.85% LTV 3 51% 52.7% 1 Includes antecendent dividend 2 NAV excluding deferred tax 3 Value includes the investment in joint venture – Towarowa and Mlociny
Financial 10 review 2017 Distributable Earnings Actual for 6 Budget for 6 Variance to Actual for 12 months to months to budget months to EUR M 30 Jun 2017 30 Jun 2017 31 Dec 2016 Net property income 45.4 44.7 0.7 65.8 Other income / (expenses) 0.4 0.6 (0.2) (0.4) Administrative expenses and corporate costs (3.9) (3.7) (0.2) (12.5) Profit from operations 41.9 41.8 0.3 52.9 Finance income / (expenses) (8.1) (8.2) 0.1 (18.0) Current income taxes (1.5) (2.0) 0.5 (0.9) Profit from joint ventures 0.6 0.1 0.1 - Distributable earnings 32.9 31.9 1.0 (3.2%) 34.0 Antecendent dividend 3.7 3.6 0.1 - Total distribution to shareholders 36.6 35.5 1.1 34.0 Number of shares (milion) 705.0 705.0 - 586.1 DPS (€ cents) 5.19 5.03 3.2% 5.80 Total distribution to shareholders excluding income tax 38.1 37.5 0.6 34.9 DPS (€ cents) excluding income tax 5.40 5.31 1.7% 5.96
Financial 11 review 2017 Headline and Distributable Earnings reconciliation Actual for 6 months to Actual for 12 months to EUR M 30 Jun 2017 31 Dec 2016 Net profit attributable to shareholders 39.6 76.8 Fair value adjustments (net of tax and minorities) (15.6) (44.7) Headline earnings 24.0 32.0 Amortised cost of debt 0.9 4.4 Change in deferred tax 8.4 18.5 2.6 (2.2) Foreign exchange gains/(losses) Fair value gains in joint ventures (2.1) (12.5) Other non-cash elements 0.4 (0.9) (1.3) (5.3) Non-distributable capital gains Distributable earnings 32.9 34.0 Antecendent dividend 3.7 - 36.6 34.0 Distribution to shareholders
Financial 12 review 2017 Summary Statement of Financial Position 30 Jun 2017 31 Dec 2016 EUR M ASSETS Non-current assets 1 743 1 424 Investment property 1 623 1 359 Number of Investment in JVs 92 54 shares in issue Financial assets 28 10 Current assets 125 86 Trade and other receivables 21 33 Financial assets 704 970 211 11 9 Restricted cash 23 22 Cash and cash equivalents 70 22 Total assets 1 868 1 509 EQUITY AND LIABILITIES Loan to value Equity 789 624 NAV per share Share capital 572 475 (LTV) Share premium 147 95 Accumulated profit 71 54 Non-current liabilities 950 818 €1.23 51 % 2 Bank borrowings 861 742 Other liabilities 14 18 Deferred tax liability 75 59 Current liabilities 129 67 Bank borrowings 93 53 Trade and other payables 36 14 Total equity and liabilities 1 868 1 509 1 NAV excluding deferred tax 2 Value includes the investment in joint ventures: Towarowa and Młociny
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