Wrap Text
Reviewed condensed consolidated financial results for the year ended 31 December 2015
NEW EUROPE PROPERTY INVESTMENTS PLC
Incorporated and registered in the Isle of Man with registration number 001211V
Registered as an external company with limited liability under the laws of South Africa registration number 2009/000025/10
Registered office: 2nd Floor, Anglo International House, Lord Street, Douglas, Isle of Man, IM1 4LN
AIM share code: NEPI
BVB share code: NEP
JSE share code: NEP
ISIN: IM00B23XCH02
('NEPI', 'the Group' or 'the Company')
REVIEWED CONDENSED CONSOLIDATED FINANCIAL RESULTS
FOR THE YEAR ENDED 31 DECEMBER 2015
DIRECTORS' COMMENTARY
DISTRIBUTABLE EARNINGS
The Group achieved 34.76 euro cents in recurring distributable earnings per share for 2015, which combined with the 0.58 euro cents per share
non-recurring distributable earnings (which were the result of a financial discount derived from the early repayment of a term loan) represents
a 19% improvement in distributable earnings per share compared to 2014. The growth in distributable earnings for 2015 is due to the continuing
strong performance of NEPI's assets, the positive impact of acquisitions and developments completed during the year, and the favourable funding
arrangement with the minority shareholder of Mega Mall.
FINAL DISTRIBUTION AND OPTION TO RECEIVE CAPITAL RETURN
The Board declares a distribution of 17.17 euro cents per share for the six months ended 31 December 2015, which combined with the distributable
earnings for the first half of the financial year, results in a 35.34 euro cents per share distribution for 2015. Shareholders can elect to
receive their distribution in cash or by way of an issue of fully paid shares at a ratio between the distribution declared and the reference price.
The reference price will be determined using an up to 5% discount to the 5 - day volume weighted average traded price (less distribution) of NEPI shares
on the JSE, no later than 1 March 2016.
A circular containing full details of the election being offered to shareholders, accompanied by announcements on the Stock Exchange News
Service (SENS) of the Johannesburg Stock Exchange (JSE), the Regulatory News Service (RNS) of the London Stock Exchange (LSE) and the
Bucharest Stock Exchange (BVB), will be issued in due course.
HIGHLIGHTS
INVESTMENT GRADE RATINGS AND BOND ISSUE
In October 2015, Standard & Poor's Ratings Services (S&P) assigned NEPI a first-time 'BBB-' preliminary, long-term corporate credit rating. Moody's
Investors Service (Moody's) has upgraded the Company's rating to Baa3, replacing 2014's Ba1 rating. Both ratings have a stable outlook.
Subsequent to a roadshow with European fixed-income investors in November 2015, NEPI issued EUR400 million of unsecured, 5.25 year Eurobonds
maturing on 26 February 2021, carrying a 3.750% fixed coupon and with an issue price of 99.597%. This represents a milestone for NEPI, as it is the
first time the Company has raised material amounts from European investors, enabling it to compete more effectively in the Central and Eastern
European real estate markets in the long term. Of the proceeds, approximately EUR212 million refinanced existing debt, while the balance is earmarked for acquisitions
and developments.
ACQUISITIONS AND DEVELOPMENTS
The Group completed the acquisition and development of a number of properties during 2015 which are discussed in more detail below. The
effective, or opening, date of acquisitions and developments is indicated in parenthesis after the name. All populations are estimates, and all
developments and acquisitions are located in Romania unless otherwise specified.
RETAIL PROPERTY ACQUISITIONS, COMPLETED DEVELOPMENTS AND EXTENSIONS
Mega Mall (14 May 2015)
The Group's largest development to date, the 75,500m(2) Gross Leasable Area (GLA) Mega Mall, commenced trading in the first half of 2015, and is
currently 98.2% occupied. Since opening, the centre has dominated retail in heavily populated eastern Bucharest, with a catchment area of 910,000
within a 30-minute drive. Peek & Cloppenburg opened its largest store in Romania in Mega Mall during October 2015.
Iris Titan Shopping Center (1 July 2015)
NEPI acquired Iris Titan Shopping Center, a 44,700m(2) GLA shopping mall, located in Titan, Bucharest's most densely populated district. There are
599,000 residents within a 15-minute drive. The property is anchored by Romania's first, and largest, Auchan hypermarket, and contains numerous
international brands, such as Adidas, C&A, CCC, Deichmann, dm, Flanco, H&M, New Yorker and Takko, as well as a seven-screen cinema.
City Park extension – first phase (31 July 2015)
The Group opened the first phase of the mall's extension, a ten-screen Cinema City, featuring Romania's second 4DX auditorium (the first is in
NEPI's Mega Mall). The centre is located in Constanta, which has a population of 284,000. There are 541,000 residents within a 45-minute drive.
Shopping City Deva extension (24 September 2015)
The 10,100m(2) GLA extension to Shopping City Deva attracts the city's 57,000 inhabitants. There are 277,000 residents within a 45-minute drive.
The extension includes new tenants such as Altex, C&A, CCC, a six-screen Cinema City, Deichmann, H&M, Hervis, KFC, New Yorker, Orsay and an
entertainment area. The total GLA after the extension is 52,300m(2), and these additional brands and facilities strengthen the centre's regionally
dominant position.
Severin Shopping Center extension – first phase (15 October 2015)
The first phase of Severin Shopping Center's extension, located in Drobeta Turnu Severin, comprises 4,400m(2) GLA. The city has 86,000 inhabitants
and 175,000 residents live within a 45-minute drive from the shopping centre. New tenants include Benvenuti, a six-screen Cinema City, KFC, as well as
leisure and entertainment facilities.
Shopping City Timisoara – hypermarket and gallery (26 November 2015)
NEPI is progressing with the development of the 56,800m(2) GLA first phase of a regional mall of up to 80,000m(2) GLA, in a densely populated
district of Timisoara. The city, with 319,000 inhabitants, is the third largest in Romania, while 570,000 residents are within a 45-minute drive. The
first section, comprising 16,300m(2) GLA, includes tenants such as Carrefour, Media Galaxy, Noriel, Pepco and Zoomania. The adjacent do-it-yourself
store, owned by Dedeman, opened on 23 October 2015.
OFFICE PROPERTY ACQUISITIONS, COMPLETED DEVELOPMENTS AND EXTENSIONS
The Office, Cluj-Napoca – second phase (27 November 2015)
The second phase of The Office, Cluj-Napoca, comprising 19,400m(2) of A-grade office GLA has been completed, and was ready for tenant fit out in
November 2015.As at 8 February 2016, 82% of Phase II has been let.
City Business Centre, Timisoara - buildings D&E (30 November 2015)
NEPI has completed the acquisition of City Business Centre by adding the newest two buildings in the complex to its portofolio. The total GLA is
now 47,100m(2) and the property is the largest A-grade office in Timisoara.
DEVELOPMENT PIPELINE
The Group has steadily increased its investment in developments and, during the last five years, completed developments and redevelopments have
significantly contributed to the growth in distributable earnings per share. NEPI's development pipeline, including redevelopments and extensions,
has increased to EUR601 million (estimated at cost), of which EUR145 million had been spent by 31 December 2015. This represents an increase of
EUR54 million compared with the previous year.
RETAIL PROPERTY DEVELOPMENTS AND EXTENSIONS
City Park extension – second phase
Work on the second phase of City Park's extension, including tenants such as C&A, Collins, H&M, Motivi, New Yorker, Orsay, Sephora, World Class and Zara Home,
is on-going and completion is expected during the second quarter of 2016. Once completed, the centre's total GLA will be 49,800m(2).
Promenada Mall extension
The Group is in the process of obtaining new zoning and construction permits for a retail extension and integrated office building to its Promenada
Mall, situated in Bucharest's new central business district. The extension will add approximately 34,000m(2) of retail GLA to the existing 40,400m(2),
while the integrated office will consist of at least 30,000m(2) GLA. The retail extension will include new fashion tenants, a cinema and additional
leisure and entertainment facilities, as well as 1,900 new parking spaces that will benefit residents and employees. Subject to permitting, NEPI
estimates that the extension will be completed in 2018.
Severin Shopping Center extension – second phase
The Group will extend Severin Shopping Center with an additional 1,500m(2) fashion GLA during 2016, increasing total GLA to 22,400m(2).
Shopping City Timisoara – fashion and entertainment section
The Carrefour hypermarket and gallery opened in the last quarter of 2015, while the fashion and entertainment section is scheduled to be
completed in the first quarter of 2016. Fashion tenants will include Bershka, C&A, CCC, Cropp, Deichmann, dm, Douglas, H&M, Hervis, KFC, Koton,
LC Waikiki, New Yorker, Orsay, Otter, Pimkie, Pizza Hut, Pull&Bear, Sephora, Sport Vision, Stradivarius, Tom Tailor and Zara. The centre will have
substantial modern entertainment and leisure facilities, including a gym and a thirteen-screen cinema (the largest cinema outside of Bucharest),
with an IMAX and a 4DX auditorium.
Shopping City Piatra Neamt
The Group is developing a 27,900m(2) GLA regional mall in Piatra Neamt. The city has 86,000 inhabitants with 245,000 residents within a 45-minute
drive. Carrefour has been secured as a tenant for a 10,000m(2) GLA hypermarket together with a six-screen cinema operated by Cinema City. Other
secured tenants include C&A, CCC, Orsay and Pepco. The shopping centre is scheduled to open in the fourth quarter of 2016.
OFFICE DEVELOPMENTS
The Office, Cluj-Napoca – third phase
Based on the strong demand for quality office space, NEPI will soon commence work on the third phase of The Office, Cluj-Napoca, consisting of
18,500m(2) GLA. The Group estimates that it will be completed during 2017.
Victoriei Office
This development, located in Victoriei Square, adjacent to the Romanian Government building, includes the development of a modern office and the
refurbishment of a historical building. This 8,400m(2) GLA landmark office is scheduled for completion in the third quarter of 2016.
OTHER HIGHLIGHTS
Non-recoverable tenant income for 2015 amounted to EUR398 thousand, equivalent to 0.26% of annual contractual rental income and expense
recoveries. The vacancy level as at 31 December 2015 was 2.9%, without accounting for properties held for sale. The increase in vacancy compared to the 1.8% reported at
the end of 2014 is mostly attributable to the recently completed office development and recent acquisitions.
The Company is actively pursuing investment opportunities in other CEE countries where it currently has no presence and expects to enter new
markets in 2016. Although increased competition (arising partly from high liquidity) can be seen across the markets, and yield compression
occurred during the past period, NEPI remains well positioned for further expansion, given its established property platform.
CHANGES TO THE BOARD OF DIRECTORS
As announced on 30 December, 2015, Mr Dewald Joubert has resigned as Non-executive Director. The Board of Directors appointed Mr Robert
Reinhardt Emslie as non-executive Director, effective from 4 February, 2016. Mr Emslie is a Chartered Accountant, with significant experience in
banking services and property management, and currently holds chairmanship and non-executive directorship positions in various private and
listed companies.
CASH MANAGEMENT AND DEBT
Throughout the financial year the Company raised EUR179 million by issuing new ordinary shares.
Following the successful EUR400 million unsecured bond issue completed in November 2015, the Company repaid the EUR143.8 million unsecured,
syndicated term loan (contracted earlier in 2015 as a bridge to the bond financing) and EUR68 million of secured debt. The Group improved
the funding terms on its most attractive debt facilities, including Aupark Kosice, Aupark Zilina and Floreasca Business Park.
As at 31 December 2015, the Group had EUR330 million in cash and an additional undrawn revolving facility of EUR80 million. NEPI's gearing ratio
(interest bearing debt less cash divided by investment property and listed property shares) reached 14.6%, compared to 8% at the end of the
previous year, and is expected to increase further, once available cash is spent to finance the acquisitions and development pipeline.
Capital commitments for developments and acquisitions in due diligence or at an advanced stage of negotiations exceed EUR300 million.
The average interest rate, including hedging costs, was 3.9% during 2015, down from 5% in 2014, due to contracting new debt at lower rates and
decreasing the interest margin on the existing debt. As at 31 December 2015, the Group was fully hedged against interest rate movements, with 41%
of the base interest rate (Euribor) being hedged with interest rate caps and 59% with interest rate swaps.
PROSPECTS AND EARNINGS GUIDANCE
Recurring distributable earnings per share for the year 2016 are projected to be approximately 15% higher compared to 2015.
Recurring distributable earnings for the first half of 2016 are expected to be approximately 5% higher compared to the respective period of 2015
due to changes in funding arrangements and timing of completion of developments and acquisitions planned for the first part of 2016.
The earnings guidance is based on the assumption that a stable macroeconomic environment prevails, no major corporate failures occur, planned
developments remain on schedule, and is sensitive to the impact of the acquisitions currently in the pipeline. This forecast has not been audited
or reviewed by NEPI's auditors and is the responsibility of the Board.
By order of the Board of Directors,
Alexandru Morar Mirela Covasa
Chief Executive Officer Finance Director
9 February 2016
Management Accounts
CONSOLIDATED STATEMENT OF INCOME 31 Dec 2015 31 Dec 2014
Gross rental income 110 937 67 459
Net service charge and operating expenses (2 526) (1 733)
Service charge and other recoveries 44 074 25 619
Property operating expenses (46 600) (27 352)
Net operating income 108 411 65 726
Corporate expenses (9 618) (4 538)
Property management net result 2 902 1 498
EBITDA 101 695 62 686
Net finance expense (5 759) (1 677)
Finance expenses (17 829) (15 676)
Finance income 3 822 6 374
Interest capitalised on development 8 248 7 625
Non-controlling interest (7 427) 4 920
Direct investment result 88 509 65 929
Indirect investment result 69 889 33 266
Profit for the period attributable to equity holders 158 398 99 195
Reverse indirect result (69 889) (33 266)
Company specific adjustments 12 096 2 273
Distributable earnings before issue cum distribution 100 605 68 202
Issue cum distribution adjustment 1 954 6 870
Distributable earnings 102 559 75 072
Distributable earnings per share (euro cents) 35.34 29.69
of which recurring distributable earnings per share (euro cents) 34.76 29.69
Distribution per share (euro cents) 35.34 32.22
CONSOLIDATED STATEMENT OF FINANCIAL POSITION 31 Dec 2015 31 Dec 2014
ASSETS
Non-current assets 1 858 740 1 389 772
Investment property 1 814 357 1 334 512
Investment property at fair value 1 655 219 1 038 545
Developments at cost 159 138 213 894
Advances paid for investment property – 82 073
Goodwill 23 986 17 639
Other long-term assets 18 115 37 446
Financial assets at fair value through profit or loss 2 282 175
Current assets 410 095 180 526
Investment property held for sale 25 255 27 360
Trade and other receivables 55 229 41 199
Cash and cash equivalents 329 611 111 967
Total assets 2 268 835 1 570 298
LIABILITIES 772 285 329 009
Bank borrowings 201 095 218 399
Bonds 393 414 –
Deferred tax liabilities 93 571 55 907
Other long-term liabilities 15 443 9 446
Financial liabilities at fair value through profit or loss 3 417 5 104
Trade and other payables 65 345 40 153
Equity attributable to equity holders 1 496 550 1 241 289
Total liabilities and equity attributable to equity holders 2 268 835 1 570 298
Adjusted Net Asset Value per share (euro) 5.25 4.63
All amounts in EUR'000 unless otherwise stated
RECONCILIATION OF PROFIT FOR THE PERIOD TO DISTRIBUTABLE EARNINGS 31 Dec 2015 31 Dec 2014
Profit for the period attributable to equity holders 158 398 99 195
Unrealised foreign exchange loss 348 350
Acquisition fees 933 2 357
Share-based payment expense 670 675
Accrued interest on share-based payments 89 542
Fair value adjustments of investment property (89 946) (35 227)
Fair value gains of financial investments at fair value through profit or loss – (1 299)
Fair value adjustment of financial assets and liabilities (1 398) 2 882
Amortisation of financial assets (3 554) (708)
Dividends received from financial investments – (2 417)
Accrued dividend for financial investments – 2 304
Gain on disposal of investment property – (619)
Gain on acquisition of subsidiaries – (1 400)
Deferred tax expense 19 508 1 567
Shares issued cum distribution 1 954 6 870
Adjustments related to non controlling interest
Fair value adjustment of Investment property 18 598 –
Deferred tax expense (3 041) –
Distributable earnings for the period 102 559 75 072
Distribution from reserves - 6 659
Less: distribution declared (102 559) (81 731)
Interim distribution (51 304) (33 475)
Final distribution (51 255) (48 256)
Earnings not distributed – –
Number of shares entitled to distribution 298 590 564 278 138 240
Distributable earnings per share for the period (euro cents) 35.34 29.69
Distribution from reserves per share (euro cents) – 2.53
Less: Distribution declared per share (euro cents) (35.34) (32.22)
Interim distribution per share (euro cents) (18.17) (14.87)
Final distribution per share (euro cents) (17.17) (17.35)
Earnings not distributed (euro cents) - -
LEASE EXPIRY PROFILE 2016 2017 2018 2019 2020 2021 2022 2023 2024 =2025 Total
Total based on rental income 3.9% 9.7% 13.0% 14.1% 17.1% 13.8% 4.4% 2.8% 4.4% 16.8% 100%
Total based on rented area 1.7% 6.8% 12.8% 12.7% 14.1% 12.8% 5.3% 5.4% 5.7% 22.7% 100%
BASIS OF PREPARATION - MANAGEMENT ACCOUNTS
The management accounts presented constitute pro forma financial information in terms of the JSE Limited Listing Requirements.
As the Group is focusing on being consistent on those areas of reporting that are seen to be of most relevance to investors and on providing
a meaningful basis of comparison for users of the financial information, it has prepared unaudited management accounts. The main difference
between the management accounts and the condensed consolidated financial results prepared in accordance with IFRS is that the management
accounts are prepared using the proportionate consolidation method for investments in joint ventures, which is not in accordance with IFRS
(consistent with financial statements prepared in accordance with IFRS reported before 1 January 2013), while the IFRS statements use the equity
method for accounting for these investments (following the adoption of IFRS 11 'Joint Arrangements' effective 1 January 2013).
The management accounts have been prepared by and are the responsibility of the Directors of NEPI. Due to their nature, the management
accounts may not fairly reflect the financial position and results of the Group after the differences set out above.
The directors are not aware of any matters or circumstances arising subsequent to 31 December 2015 that require any additional disclosure or
adjustment to the reviewed condensed consolidated financial results.
In relation to management accounts included in this preliminary report, a reporting accountant's report is required by JSE Limited
and will be available for inspection at the Company's registered office. Furthermore, any reference to future financial performance included in
this preliminary report has not been reviewed or reported on by the group's external auditors. The auditor's review report does not necessarily
report on all of the information contained in this announcement/financial results. Shareholders are therefore advised that in order to obtain a full
understanding of the nature of the auditor's engagement they should obtain a copy of the auditor's review report together with the accompanying
financial information from the Company's registered office. The directors take full responsibility for the preparation of the preliminary report.
IFRS ACCOUNTS
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Reviewed Audited
31 Dec 2015 31 Dec 2014
Net rental and related income 104 067 61 749
Contractual rental income and expense recoveries 148 799 87 017
Property operating expenses (44 732) (25 268)
Administrative expenses (6 695) (2 839)
EBITDA 97 372 58 910
Acquisition fees (933) (2 357)
Fair value adjustments of investment property 81 742 27 980
Fair value gains on financial investments at fair value through profit or loss – 1 299
Dividends received from financial investments – 2 417
Share-based payment expense (670) (675)
Foreign exchange loss (339) (241)
Gain on acquisition of subsidiaries – 1 400
Gain on disposal of investment property – 619
Profit before net finance income/(expense) 177 172 89 352
Net finance income/(expense) (916) 3 278
Finance income 7 613 7 315
Finance expense (8 529) (4 037)
Changes in fair value of financial instruments 1 149 (1 866)
Share of profit of joint ventures 2 399 4 148
Profit before tax 179 804 94 912
Deferred tax expense (13 979) (637)
Profit after tax 165 825 94 275
Total comprehensive income for the year 165 825 94 275
Non-controlling interest (7 427) 4 920
Profit for the period attributable to equity holders 158 398 99 195
Weighted average number of shares in issue 284 461 222 225 426 685
Diluted weighted average number of shares in issue 285 813 260 229 775 959
Basic earnings per share (euro cents) 55.68 44.00
Diluted earnings per share (euro cents) 55.42 43.17
CONSOLIDATED STATEMENT OF FINANCIAL POSITION Reviewed Audited
31 Dec 2015 31 Dec 2014
ASSETS
Non-current assets 1 829 440 1 368 193
Investment property 1 732 760 1 269 299
Investment property at fair value 1 576 019 978 980
Investment property under development 156 741 208 246
Advances paid for investment property – 82 073
Goodwill 23 986 17 639
Investments in joint ventures 15 640 13 241
Long-term loans granted to joint ventures 36 674 30 395
Other long-term assets 18 098 37 444
Financial assets at fair value through profit or loss 2 282 175
Current assets 381 097 148 705
Trade and other receivables 54 487 40 469
Cash and cash equivalents 326 610 108 236
Investment property held for sale 25 255 27 360
Total assets 2 235 792 1 544 258
EQUITY AND LIABILITIES
Total equity attributable to equity holders 1 496 550 1 241 289
Share capital 2 986 2 746
Share premium 1 213 325 1 074 310
Share-based payment reserve 4 797 4 127
Currency translation reserve (1 229) (1 229)
Accumulated profit 275 042 167 133
Non-controlling interest 1 629 (5 798)
Total liabilities 739 242 302 969
Non-current liabilities 661 717 241 345
Bank borrowings 162 788 171 071
Bonds 392 140 –
Deferred tax liabilities 89 652 57 517
Other long-term liabilities 14 988 9 171
Financial liabilities at fair value through profit or loss 2 149 3 586
Current liabilities 77 525 61 624
Trade and other payables 62 827 38 365
Bank borrowings 13 424 23 259
Interest accrued on bonds 1 274 –
Total equity and liabilities 2 235 792 1 544 258
SEGMENTAL ANALYSIS Retail Office Industrial Corporate Total
2015 Reviewed
Contractual rental income and expense recoveries 120 046 26 728 2 025 – 148 799
Profit before net finance expense 162 501 15 856 1 295 (2 480) 177 172
Total Assets 1 532 260 380 016 17 099 306 417 2 235 792
Total Liabilities 241 875 99 038 2 372 395 957 739 242
2014 Audited
Contractual rental income and expense recoveries 59 496 25 541 1 980 – 87 017
Profit before net finance expense 67 431 18 719 1 728 1 474 89 352
Total Assets 1 153 768 292 647 17 208 80 635 1 544 258
Total Liabilities 167 993 129 111 2 382 3 483 302 969
BUSINESS COMBINATIONS Aupark Kosice Iris Titan Shopping Center City Business Centre
18 Dec 2014* 1 Jul 2015 30 Nov 2015
Investment property 165 000 86 000 28 533
Current assets 9 599 5 164 1 038
Current liabilities (8 677) (960) (256)
Non-current liabilities (82 875) (1 154) (5 610)
Deferred tax liabilities (11 189) (4 905) (2 063)
Total identifiable net assets at fair value 71 858 84 145 21 642
Goodwill arising on acquisition 11 189 4 905 2 717
Total consideration payable 83 047 89 050 24 359
Amounts retained from sellers (1 500) – (5 000)
Total consideration paid in cash 81 547 89 050 19 359
*Transaction finalised in 2015
All amounts in EUR'000 unless otherwise stated
Share-based Currency Non-
CONSOLIDATED STATEMENT Share Share payment translation Accumulated controlling
OF CHANGES IN EQUITY capital premium reserve reserve profit interest Total
Balance at 1 January 2014 1 999 632 296 3 453 (1 229) 76 595 (878) 712 236
Transactions with owners 747 442 014 674 – (8 657) – 434 778
– Issue of shares 715 427 289 – – – – 428 004
– Share-based payment reserve – – 11 882 – – – 11 882
– Sale of shares issued under
the Current Share Scheme 12 3 293 (431) – – – 2 874
– Vesting of shares issued under
the Initial Share Scheme – – 675 – – – 675
– Vesting of shares issued under
Current Share Scheme 13 4 791 (4 804) – – – –
– Reclassification of Current
Share Scheme 7 6 641 (6 648) – – – –
– Earnings distribution – – – – (8 657) – (8 657)
Total comprehensive income – – – – 99 195 (4 920) 94 275
– Profit for the period – – – – 99 195 (4 920) 94 275
Balance at 31 December 2014 2 746 1 074 310 4 127 (1 229) 167 133 (5 798) 1 241 289
Balance at 1 January 2015 2 746 1 074 310 4 127 (1 229) 167 133 (5 798) 1 241 289
Transactions with owners 240 139 015 670 – (50 489) – 89 436
– Issue of shares 205 129 767 – – – – 129 972
– Sale of shares issued under
the Initial Share Scheme 35 9 248 – – – – 9 283
– Vesting of shares issued under
the Initial Share Scheme – – 670 – – – 670
– Earnings distribution – – – – (50 489) – (50 489)
Total comprehensive income – – – – 158 398 7 427 165 825
– Profit for the period – – – – 158 398 7 427 165 825
Balance at 31 December 2015 2 986 1 213 325 4 797 (1 229) 275 042 1 629 1 496 550
RECONCILIATION OF NET ASSET VALUE TO ADJUSTED NET ASSET VALUE Reviewed Audited
31 Dec 2015 31 Dec 2014
Net Asset Value per the Statement of financial position 1 496 550 1 241 289
Loans in respect of the Initial Share Scheme 64 9 132
Deferred tax liabilities 89 652 57 517
Goodwill (23 986) (17 639)
Deferred tax liabilities/(assets) for joint ventures 3 919 (1 610)
Adjusted Net Asset Value 1 566 199 1 288 689
Net Asset Value per share (euro) 5.01 4.52
Adjusted Net Asset Value per share (euro) 5.25 4.63
Number of shares for Net Asset Value per share purposes 298 565 564 274 526 188
Number of shares for adjusted Net Asset Value per share purposes 298 590 564 278 138 240
RECONCILIATION OF PROFIT FOR THE PERIOD TO HEADLINE EARNINGS Reviewed Audited
31 Dec 2015 31 Dec 2014
Profit for the period attributable to equity holders 158 398 99 195
Fair value adjustments of investment property (81 742) (27 980)
Gain on sale of investment property – (619)
Gain on acquisition of subsidiaries – (1 400)
Total tax effects of adjustments 14 333 4 952
Fair value adjustment of investment property for joint ventures (8 204) (7 247)
Total tax effects of adjustments for joint ventures 1 312 1 160
Headline earnings 84 097 68 061
Weighted average number of shares in issue 284 461 222 225 426 685
Diluted weighted average number of shares in issue 285 813 260 229 775 959
Headline earnings per share (euro cents) 29.56 30.19
Diluted headline earnings per share (euro cents) 29.42 29.62
CONDENSED CONSOLIDATED Reviewed Audited
STATEMENT OF CASH FLOWS 31 Dec 2015 31 Dec 2014
Profit after tax 165 825 94 275
Adjustments (66 987) (33 574)
Changes in working capital 1 378 (10 406)
Cash flows from operating activities 100 216 50 295
Proceeds from issue of shares 139 255 430 878
Earnings distribution (50 489) (8 657)
Net movements in bank loans and bonds borrowings 297 522 (43 704)
Other proceeds/payments (2 395) -
Cash flows from financing activities 383 893 378 517
Investments in acquisitions and developments (265 735) (437 863)
Net cash flow from investments in financial assets - 64 795
Cash flows used in investing activities (265 735) (373 068)
Net increase in cash and cash equivalents 218 374 55 744
Cash and cash equivalents brought forward 108 236 52 492
Cash and cash equivalents carried forward 326 610 108 236
LOANS AND BORROWINGS REPAYMENT PROFILE
Outstanding Available for 2021
Type Secured/Unsecured Ownership amount drawdown 2016 2017 2018 2019 2020 and beyond
NE Property Cooperatief Fixed coupon bonds Unsecured 100% 400 000 – – – – – – 400 000
Aupark Kosice Mall Term loan Secured 100% 80 143 24 857 5 526 5 526 5 526 5 526 58 039 –
Floreasca Business Park Term loan Secured 100% 47 787 – 3 920 3 920 39 947 – – –
Aupark Zilina Term loan Secured 100% 47 415 – 3 557 43 858 – – – –
Ploiesti Shopping City (joint venture) Term loan Secured 50% 16 334 – 1 095 1 095 1 095 1 095 1 095 10 859
The Office, Cluj-Napoca (joint venture) Term loan Secured 50% 8 814 – 683 450 450 450 6 781 –
NE Property Cooperatief Revolving facility Unsecured 100% – 80 000 – – – – – –
Total 600 493 104 857 14 781 54 849 47 018 7 071 65 915 410 859
The reference base rate (1 month EURIBOR, 3 month EURIBOR) was hedged with a weighted average interest rate cap of 0.3% for 41% of the outstanding notional amount and a weighted average interest rate swap of 1.7% for 59% of the outstanding notional amount.
BASIS OF PREPARATION - IFRS accounts
The reviewed condensed consolidated financial results for the year ended 31 December 2015 have been prepared in accordance with the
recognition and measurement criteria of the International Financial Reporting Standards (“IFRS”) and interpretations adopted by the International
Accounting Standards Board (“IASB”), the presentation and the disclosure requirements of IAS 34 Interim Financial Reporting and the JSE
Listings Requirements. The accounting policies which have been applied are consistent with those used in the preparation of the annual
financial statements for the year ended 31 December 2014. The directors take full responsibility for the preparation of this preliminary report.
PricewaterhouseCoopers LLC have issued an unmodified review report on the condensed consolidated financial statements for the year
ended 31 December 2015 which is available for inspection at the Company's registered office.
For further information please contact: New Europe Property Investments Plc, Mirela Covasa: +40 21 232 1398
AIM Nominated Adviser and Broker: Smith & Williamson Corporate Finance Limited, Azhic Basirov: +44 20 7131 4000
JSE sponsor: Java Capital: +27 11 722 3050 BVB advisor: SSIF Intercapital Invest SA, Razvan Pasol: +40 21 222 8731
www.nepinvest.com
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