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EPP posts 12 percent half-year distribution per share growth

EPP, Poland’s largest retail property owner, posted distribution growth of 12 percent per share to EUR 5.82 cents for the six months ended 30 June 2018. The JSE-listed company is on target to deliver full year dividends between 11.6 – 11.8 euro cents.

EPP’s results show distributable earnings increased 32 percent to EUR 48.3 million. Net property income growth increased 45 percent to EUR 66.2 million. EPP’s successful acquisition of the first tranche of its three-phase M1 portfolio deal added 194,000 sqm to its retail property portfolio, increasing total income-producing assets to more than EUR 2 billion. Net asset value (NAV) per share increased 4 percent to EUR 1.37.

Hadley Dean, CEO of EPP, comments: “We are pleased with the performance in the first half. Even with the new Sunday sales ban, our asset and property management teams were able to achieve strong returns. The retail sector in Poland continues to be fuelled by a growing middle class, and our vacancy rates remain below 1 percent.”

EPP grew closer to its stated goal of becoming a pure retail-focused company by expanding the share of retail property in its portfolio from 74 percent from the previous year to 85 percent, with retail gross lettable area (GLA) rising to 638,815 sqm.

Dean says: “The strong macroeconomic conditions in Poland, with increasing employment, wage growth and consumer spending have exciting potential for consumption and retail sales growth. Poland is experiencing GDP growth well above the EU average, and Poland will continue to be the key spot in Europe for growth in retail during the next few years.”

With its M1 acquisition pipeline, EPP is set to own 28 shopping centres spanning more than a million square metres, all within a 30-minute drive of 40 percent of Poland’s wealthiest regions by 2020.

After the close of its half-year, EPP also acquired the King Cross Marcelin shopping centre of 45,300 sqm in affluent western Poznan.

Construction of Galeria Młociny, EPP’s flagship Warsaw development, is on track and on schedule to open in spring 2019 with pre-letting currently at 87 percent.

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